ADOT Audit ProceduresADOT = “The Standard of Excellence for Transportation Systems and Services”.

Arizona Department of Transportation Right of WayAUDIT PROCEDURES FOR LOCAL GOVERNMENTS:

ADOT Contact:Arizona Department of TransportationLouis J. Malloque, Right of Way Agent III,ADOT Liaison to the Local Public Agents(602) 712-8755 lmalloque@azdot.gov205 South 17th AvenueMail Drop 612EPhoenix, Arizona 85007www.azdot.gov/highways/row/project.asp

All slides prepared by Louis Malloque & Jim Stoleson

WHERE DOES THE ARIZONA DEPARTMENT OF TRANSPORTATION RECEIVE THE AUTHORITY TO PERFORM AUDITS ON THE LPAS FEDERALLY FUNDED PROJECTS:

Obligations and Responsibilities of ADOT to the Local Public Agents (LPAs):

The Arizona Department of Transportation (ADOT) has the obligation to aid Local Public Agencies/Agents (LPAs) in obtaining maximum utilization of available federal funds for qualifying transportation projects. The Federal Highway Administration (FHWA) procedures require ADOT to administer Federal-Aid projects within the rules and regulations required by the federal government, including but not limited to the Uniform Relocation Assistance and Real Property Acquisition Policies of Act of 1970 and thereafter Amended (Uniform Act). (49 CFR Part 24)In the ADOT Right of Way manual and the ADOT Local Governments’ manual, there are certain obligations, assurances and responsibilities that the LPAs give to FHWA, and ADOT assures that these obligations and responsibilities will be carried out.

ADOT has the responsibility to review Federal Aid Project files (given by FHWA to ADOT, in the Working Agreement between ADOT and FHWA) to see whether or not the LPAs are following the Uniform Act as well as the State and Federal rules and regulations.

ADOT is also responsible for the administering of the Federal Aid funds and it has the responsibility for coordinating the Federal-aid Program for all LPAs. As part of this coordination, the Department must review work done by the LPAs and provide compliance assurances to the Federal Highway Administration. In the contract that the LPAs signs with ADOT in order to receive Federal Funding, the contract states that the LPA will allow ADOT/FHWA access to all Federal Aid files for review and/or audit.

The Code of Federal Regulation (CFR) has a section that is specifically for the acquisition and relocation of property needed for public use Uniform Act (49 CFR Part 24).ADOT conducts a very methodical and systematic audit/review of the LPA Federally Funded project files. First, it is important to point out that sometimes ADOT does conduct audits in conjunction with the FHWA and sometimes without them. ADOT only reviews/audits the Federally Funded project files/parcel files. ADOT ROW only reports any real uncorrectable anomalies to FHWA; ADOT’s job is to help the LPAs as much as possible, not set penalties for violation of law. ADOT does its best to help the LPA to correct any anomalies found. If a solution is not apparent, ADOT turns the findings over to FHWA to help find a resolution. After that it is totally up to FHWA to handle. ADOT will normally ask for a random sampling of Federally Funded projects (about 10-25% of total amount).

Then ADOT look at all parcel files in each of the sampled projects. There is a second type of audit/review we conduct. That is a complete audit on a single project if we have information there might be some anomalies or if we are asked by the LPA to come and review a project.ADOT conducts both an entrance interview and an exit interview when auditing a LPA. In the entrance interview, ADOT tells the LPA why and what we are there for; what we will be looking at and generally what will take place. The exit interview tells the LPA what was found and some ideas on how to rectify any anomalies found that can be corrected. We will send a full report within a few days.ADOT has several audit checklists that they use (see one below). The first items checked to see if they are in the project file are:

Proof of environmental clearance (copy)Authorization to proceed from FHWA (copy)Certification of Right of Way form (unless project not closed)Copy of Appraisal or waiver of appraisal form (Scope of Work)Copy of review appraisal (Scope of Work)Copy of memo setting what is believed to be “Just Compensation”Copy of signed offer letters and summary statementsCopy of 100% plans or latestCopy of completed and signed agent’s contact log/diaryCopy of all property owners’ correspondenceCopy of all e-mails (in chronological order from oldest on bottom)

Copy of waiver of compensation (donation form) if usedCopy of all administrative settlements and all documentation Copy of all conveying instrumentsCopy of all condemnation proceedings and related correspondence

There is another whole list of items needed for RELOCATION, see at the end of this section.Once ADOT has checked the above list in each parcel file, ADOT then checks each item for CFR compliance. If anomalies are found they are copied and placed in their individual pile for later analysis and possible corrections. When ADOT is finished reviewing all the parcel files we gather up the piles of anomalies and re-address them to make sure of what we have. This is the “basics” of an audit.In reality it is much more complicated, as ADOT reviews every aspect of the acquisition for compliance of the Federal rules and regulations. ADOT ROW uses a five (5) page document that categorizes what we need to review and it happens to have the CFR citations that go to it. It follows now.

Timing of Acquisition:

Right-of-way appraisal and acquisition can commence only after environmental and public hearing requirements have been satisfied, ADOT/FHWA approvals (Authority to Proceed for Right of Way) (ADOT form AZPR2X) received, and a design decision made by the LPA. (23 USC 128; Federal Aid Policy Guide, Parts 710-777; ADOT Action Plan).

ADOT makes sure these two most important items are documented (copies) are in the file (the environmental Clearance and the “Authority to Proceed for Right of Way” from FHWA).

However, if field investigations are required to be conducted on private property in order to obtain the data necessary for completion of the environmental document, the LPA may obtain temporary Rights-of-Entry (RE) to carry out the required field investigations (the RE MUST be approved by ADOT prior to use).

Public Information Brochure:

The LPA is required to give the property owner an explanation of the acquisition procedure (s). The explanation can be accomplished through the presentation of a brochure that adequately describes the acquisition policy under Federal and State law (ADOT has examples).

The brochure must also define the property owner’s rights, privileges, and obligations under these same laws. (49 CFR 24.102(b); 23 CFR 712.203(c))ADOT checks to see that the LPA did provide this information to the property owner.Right-of-Way Plans:

Plans need to indicate existing and new right-of-way lines, easements, and major structures within 50 feet of the new right-of-way line, slope limits, significant land features, and property lines. A parcel inventory, listing ownership and the area of the acquisition take, is also to be included. (23 CFR)ADOT reviews the plans to see where the right of way is located and if all has been acquired.

Title Report:

A Title Report shall be issued by a Title Insurance Company as the basis for a title policy. The title report MUST show the condition of title as of a specific date. A title report MUST include a chain of title of not less than five (5) years. It MUST state all adverse matters that affect the property, who the vested owner (s) are and their status, any separately held ownership and the legal description of the property.(49CFR 24.103)

ADOT checks to see if a “Title Report” was used and given to the Appraiser.

Appraisal:

Each parcel to be acquired SHALL BE appraised unless the valuation is uncomplicated and the market value is less than $2500.00 (higher if ADOT ROW approves). (49 CFR 24.102 C (2)) The Appraiser MUST be an Arizona Certified General Appraiser and have a working knowledge of the Uniform Act, and all applicable State and Federal rules and regulations. The property owner MUST be given the opportunity to accompany the appraiser (we check for proof). The LPA may contact the Right of Way Liaison of ADOT’s Right of Way Group to obtain information on selecting Appraisers and Review Appraisers, as well as appraisal formats and specifications.The appraisal process should include information on floodplain, floodways, erosion hazard, and/or development restrictions that may impact the property. All appraisals shall be dated, signed, and certified by the individual conducting the appraisal. The appraisal report shall indicate the date of valuation and the date of the report. The appraiser clearly defines the rights being acquired.(49 CFR 24.102 C (2))The Most important part of the appraisal audit is based on the “Scope of work”:

The following items are minimum Scope requirements for the appraiser by FHWA.The appraiser MUST, at a minimum:_____ Provide an appraisal meeting the agencies definition of an appraisal as in

the ADOT manual or for fed work in 49 CFR 24.2(a) (3)For this requirement the written appraisal needs to be found in the parcel file.

_____ The owner of the property (or representative) must be afforded the opportunity to accompany the appraiser on the inspection of the property. (49 CFR 24.102 ©)

For this requirement the evidence that the property owner was contacted and invited is searched out and must be found in the appraisal document.

_____ Describe the extent of inspection of the subject property, including: inspection of the neighborhood and proposed project area; inspection of subject property, including interior and exterior areas; the level of detail of description of the physical characteristics of the property being appraised (and in the case of a partial acquisition, the remaining property), per Manual.

This requirement is verified by reading the “Site Description” and checking the subject photographs to see that the appraiser really inspected in the

field._____ Include a sketch of the property and provide the location and

dimensions of any improvements.

______ Also include adequate photographs of the subject property and comparable sales and a location map showing the subject and sales, per ADOT Manual.These requirements are verified by finding the photos and maps in the

body or appendix of the report.Other items are required by ADOT’s Manual: Property rights to be

acquired, e.g., fee simple, easement, etc. Value being appraised (usually market value) and its definition.

These requirements can typically found and verified in the first few pages of the report. The definition of value that must be found is ARS 12-1122

(for LPA’s)______ Appraised as if free and clear of contamination (or as specified).

This is typically looked for and found in “Extraordinary Assumptions” portions of the appraisal report._______ The date of the appraisal report and the date of valuation.

This is verified on the cover sheet of the appraisal report, or in the transmittal letter._______ A realty/personality report is required per CFR 24.103(a)(2)(i).

This is often missed and while details are searched for in the “Site Description” and Improvement Description”, there should be a separate Realty/Personalty paragraph.

______ The known and observed encumbrances, if any Title information, Location, Zoning, Present use, and at least a 5-year sales history of the property.Typically the appraiser will pick up the encumbrances etc., but will report only a 3 year sales history as required by USPAP but not sufficient for

49CFR._____ In the appraisal report, identify the Highest and Best Use. If Highest and

Best Use is in question or different from the existing use, provide an appropriate analysis identifying the market-based Highest and Best Use.

This is analyzed to see if the report’s analysis and conclusion are credible. _____ Present and analyze relevant market information, this would include, but

not be limited to: research and analysis of, inspection of and verification of comparable sales used. (See ADOT Manual).This data is checked to see that it is consistent from the sales all the way through the analysis and conclusion of value.

_____ Address Project Influence and disregard any decrease or increase in the 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.* This will be a Jurisdictional Exception in regard to USPAP, as it is requirement of the FHWA.

Intended use and user are rarely missed in reports, however they must be checked and present.

_____ Cite the applicable definition of (fair) market value. For cases that would go to state court in Arizona, ARS #28-7091 applies for ADOT and ARS #12-1122 for Local Public Agencies. While they are very similar,

definitions for financial institutions such as: FIRREA, Freddie Mac, etc are not acceptable.

This must be checked, as appraisers will at times forget to change from the definition required by their banker clients.

_____ The appraiser shall include a certification; per the ADOT manual. In addition, appraisers may also include a USPAP certification.These must be checked and the USPAP one checked to be sure it is the current one, per the Appraisal Standards Board.

_____ The appraiser shall state all relevant assumptions and limiting conditions. In addition, the acquiring agency may provide other assumptions

and conditions that may be required for the particular appraisal assignment.These must be reviewed for relevance and completeness.All appraisals require a review appraisal process – either by LPA staff, a

contract review appraiser, or the Arizona Department of Transportation. The appraisal Review is to assure that the appraisal meets the applicable appraisal requirements, and then if so, recommend a value for acquisition. The reviewer does not set “Just Compensation”.

Review Appraisal:

The Review Appraiser is required to sign a certificate that specifically sets the recommended or approved valuation, indentifies the property reviewed and states the he, the reviewer has no interest in the property reviewed. The Review Appraiser thoroughly reviews the appraisal (s) and makes a written statement of their findings. They also recommend or approve the value (“opinion of value”). (49 CFR 24.104)A review appraiser is a thoroughly qualified appraiser who is completely familiar with the type of appraisal problem being reviewed and the techniques required to address that problem. The review appraiser will be completely familiar with the agency’s appraisal and other relevant requirements. It is very difficult for an individual who does not meet both of these qualifications to provide an appropriately through appraisal review for an acquiring agency. Before acceptance of an appraisal, the review appraiser will determine that the appraiser's documentation, including valuation data, demonstrates the soundness of the appraiser's opinion of value, and compliance with the “Scope of Work” The level of explanation for the reviewer's recommended or approved value depends on the complexity of the appraisal problem. Appraisal review is a critical quality control element in the valuation/acquisition process. In some agencies, the review appraiser (must be an employee of the LPA) acts for the agency in estimating the just compensation to be offered for the acquisition.

An appraisal review is not only an arithmetic or grammatical review of an appraisal report. It is a comprehensive technical examination of the appraisal, as reported by the appraiser. The reviewer MUST also check the “Scope of Work” the appraiser used and makes sure all the minimum requirements was met. The parcel file must be checked to see if the review documents are there. Also to see if the reviewer recommends the appraised value as stated or if there is any “reviewer’s determination” involved. The reviewer must not over-reach his assignment by changing the nature of the value determination. Following the appraisal review, the Review Appraiser must place a copy of the appraisal report/review into the parcel maintained at the LPA and must be maintained for a minimum amount of time as specified in the Uniform Act. (23 CFR 710.201 (f) (1))After the appraisal and the appraisal review, the agency official internally approves an amount it believes to be “just compensation”. This process should be documented in the file. The approval of a “just compensation” amount is an agency responsibility and cannot be delegated to a private sector contractor. The amount for Just Compensation cannot be less than the appraised value.

Compensation: A supervisory official of the LPA is responsible for property acquisitions; or their in house designated Review Appraiser shall approve what he believes to be “Just Compensation” amount for the appraised property; the “Just Compensation” is based on the recommended value designated by the review appraiser. This is a formal action which must be done in writing and placed in the parcel file by the LPA. This establishment of “Just Compensation” cannot be passed on to an outside contractor/consultant. (49 CFR 24.102 (d))

Offer: Once the property is identified as necessary for a public works project, Property is appraised, the appraisal is then reviewed and a determination of “just compensation” has been made. The Right of Way Agent then puts an offer letter together along with a summary statement of that offer (specific language content is in 49 CFR 24 102 (d) and (e)) The initial offer may not be less than the reviewed appraisal amount; however, it can be more if the LPA determines that a greater amount reflects “Just Compensation” for that property. A summary statement MUST be incorporated in the offer letter or attached.

Counter Offer:

Counter offers must be reviewed by the LPA’s Real Estate manager and a recommendation be prepared for consideration/action by the LPA’s board/council, if applicable. The recommendation must include justification (s) of any proposed counter offer. The property owner shall be advised that any action taken by the LPA’s board/council regarding the counter offer is advisory only, and only the board/council can approve, accept, or amend the counter offer. (49 CFR 24.102 (f))

Administrative Settlements:

The purchase price for the property may exceed the amount offered as Just Compensation when reasonable efforts to negotiate an agreement have failed. Only a LPA official must approve such administrative settlement; the settlement must be reasonable, prudent and in the public interest. The LPA must justify the settlement with written documentation which includes but not limited to, the new amount, any additional information brought forth by the property owner, appraisals, recent court awards, estimated trial costs or valuation problems. A copy of the settlement and all documentation must be placed in the affecting parcel file. (49 CFR 24.102 (i))

Payment Prior to Possession:

Prior to the LPA requiring the property owner to vacate the premises, the LPA must pay the agreed purchase price. However, in the case of condemnation, the LPA shall deposit with the court an amount that is not less than the LPA’s approved appraisal market value of the property, or the court award of “Just Compensation”. The LPA may, in certain cases, get a “Right of Entry” for construction purposes prior to making the payment. (49 CFR 24.102. (j)), However, the “Right of entry MUST be approved by ADOT R/W Liaison. Negotiator’s Log/Diary or Agents Contact Report: The agent/negotiator shall maintain a written account of each and every contact relating to the parcel in such detail that if another agent/negotiator had to take the file over, they could just pick it up and continue as he had worked on the parcel file all along. The log/diary shall show the date of contact, person contacted and the matters discussed and any and all outcomes. It must also provide an accurate record of communications and the log/diary MUST show that the acquisition was done in an appropriate manner. The log/diary must be signed/initialed at the bottom of each page by the agent and if more than one agent all must sign and designate who made the entry. (49 CFR 24.9 (a))

Relocation Assistance:

Relocation assistance is required if acquisition necessitates the removal of persons or personal property. When a LPA plans for relocation, everyone occupying the property is presumed to be eligible for relocation services and benefits. The LPA must pay to move personal property located within the newly acquired right of way (or improvements). Relocation advisory assistance must be offered to displaced individuals, families, businesses, farms, and non-profit organizations. (49 CFR 24. 201-209) and (Public Law (P.L.) 91-646, Title II)

Notices for Relocation:

The LPA shall give all lawful occupants a “Notice of Relocation Eligibility” promptly in writing, at the initiation of the acquisition. This notice informs the occupants of their right to relocation assistance. The LPA shall not require any lawful occupant to move unless they have received at least a ninety (90) day written notice of the earliest date they may be required to move. The LPA MUST have comparable replacement housing available at the 90 day notice. If comparable housing is not available at the time of the 90 day notice, the notice must clearly state that the occupant will not have to move any earlier than 90 days from which a comparable replacement is available. (49 CFR 24.203(c))

Rental of Acquired Property:

Rentals charged by the acquiring LPA shall not exceed the fair rental value for a short-term occupier. (49 CFR 24.102(m))

Inverse Action:

A property owner shall not be forced to institute a legal proceeding to prove the taking of his/her property. (49 CFR 24.102 (1))Uneconomic Remnant:

The LPA shall offer to acquire uneconomic remnant (s) created by a partial property acquisition. (49 CFR 24.102 (k))

Buildings, Structures, Improvements: The LPA MUST ACQUIRE (or offer to acquire) the same interest in an existing improvement as is acquired in the property if the improvement is to be removed or is adversely affected by the acquisition. For the purpose of acquisition, the improvement shall be considered a part of the property and payment for the improvement shall be its contributory value as part of the whole property or its salvage value, whichever is greater. (49 CFR 24.105 (a))

Tenant-Owned Improvements: Tenant rights shall be recognized in the appraisal. This may require a separate offer to the tenant based on a review of the tenant's lease agreement. Refer to regulations found in 49 CFR 24.105 (a). LPA projects will base compensation on a unified fee valuation. The property owner shall be responsible for determining any leasehold.

Incidental Costs of Title Transfer:

The LPA shall reimburse the property owner for all reasonable expenses incurred for: Recording fees, escrow fees, prepayment penalties, pro-rata portion of property taxes, and similar expenses in conveying the property to the acquiring LPA. (49 CFR 24.106)

Litigation Expense:

The LPA shall pay certain owner's costs in a condemnation proceeding if: The final judgment is that the LPA cannot acquire the real property by condemnation; or the proceeding is abandoned by the acquiring LPA. The LPA shall be required to pay similar costs if an inverse action is decided in favor of the plaintiff owner. (49 CFR 24.107)

Civil Rights:

All acquisition activities in connection with a Federal-aid highway project MUST be accomplished in accordance with Title VI of the Civil Rights Act of 1964 and 23 U.S.C. 324 and (23 CFR 710.401 et seq.)

Right-of-Way Certification:

A Right-of-Way Certification is prepared upon completion of the acquisition of all of the parcels required for the project. The completed certification is transmitted to the ADOT R/W Liaison. The ADOT R/W Liaison then writes a Right of Way Clearance memo and sends it to the LPA who in return places it in the general right of way project file. When a project does not have any new right of way needed, the Right of Way verification and Clearance memo may be generated at the ninety to ninety-five percent (90-95%) design stages. (23 CFR 635.309 (c))

Negotiated Items Affecting Construction:

The Project Manager shall be provided a copy of all agreements that may require the inclusion of work into the construction plans and/or specifications. These must be made part of the project file.

ADOT Right of Way audit team consists of a two (2) man team; one is an overall specialist in the total right of way process and the other is a certified appraisal compliance specialist.The audit team sends a letter/e-mail to the LPA’s designated representative and includes a list of Federally Funded projects they will want to review. In that correspondence, they inform the LPA they will be arriving in a couple of days and a small list of what they will need to have on hand for us. We usually ask for a room to work in by ourselves, access to a copy machine, and ask the LPA to designate someone to answer our questions.

What we look for and why:

Basically we start at the top of the checklist (above) and try to ascertain the date of the environmental clearance and the date of the FHWA “authorization to proceed” with right of way acquisition. We make sure they are both there and they both did precede the start of the right of way acquisition (the hiring of an appraiser and review appraiser, etc.).

The appraisal is reviewed based on the scope of work (a copy of it needs to be in the file), title report, all pertinent information in report, the letter of invitation for the property owner to accompany the appraiser on his inspection, the State Certification of the appraiser and check the report for CFR compliance.

The appraisal review is examined in the same manner.

We see if there is a “Just Compensation” memo (filled out & signed by the LPA) that matched the reviewer’s amount or if not, why, the amount set believed to be “Just Compensation”, the date signed and who signed it (was he authorized or not).

The offer letter is scrutinized to see if there was any coercive language, any time deadline for a decision to sell, the amount offered and how it was ascertained. A summary statement must be incorporated in the offer letter or attached to it. It should be in plain understandable language giving the total square footage of the property; the square footage of the property acquired and the square footage of the remainder. It must show the per square foot amount, times the amount of property taken for a total and it must included any damages, costs to cure, add- on (s) and etc.

The copy of the 100% plans is then checked to see if what is shown matches what was taken. The plans should also match the offer letter in the correct square footages are shown (total, the acquired and the remainder). The plans need to label out all property acquired, easements, and the parcel numbers.

One of the most heavily weighted reviews is on the agent’s contact log/diary. The log is scrutinized in it’s entirety for a numerous amount of information. The first items is to see if the auditor can tell what happened, when it happened, to whom it happened, why it happened, and if it all makes sense to him. The log needs to tell the complete story of all that took place in the acquisition. There should not be any incomplete thoughts or statements, (I spoke with Bob) what did you talk about, when did you talk to him and what was the outcome? or I reviewed the “just Compensation” amount and added 10%, why?

All verbal communication (face to face and/or by phone) must be documented in the log and all written communication (letters and/or e-mail) also must be attached to support the log’s entries. The agent’s log sets the climate of the Right of Way process; it gives the insight to what took place and tells the complete story of the process. This is the best documentation to take to court, as the judge always goes with what is written and not said.

The agent needs to start his entries in the log as soon as he is assigned to the project and continues to all acquisitions are completed, the relocation is done (if there is any) and the project is completed up to the beginning of construction. We also check to see that the bottom of each page is attested to by the agent (agent’s signature MUST be on the bottom of each page).

We check for any coercive actions or language that might have been imparted to the property owner.

We also check for any use of donations and/or dedications in the project. If there were donations, how they were asked for, was there pressure applied to the owner to donate. The owner must have signed a waiver consenting to the donation; it must show that he knew he could be compensated, receive an appraisal and/or both. Another consideration is how many donations were received and the circumstances they were given.

We ask the LPA for the Ordinances governing dedications. The dedication given is then checked against the Ordinances to see if they match or was more/less property taken than the stated amount in the Ordinance. The Ordinances are checked to see if there are stipulations, features or elements that the LPA gives in exchange for the dedication. If so, then we check to make sure they apply the rules the same to everyone.

Another very important component of the audit is if there are any administrative settlements used in the project. We check to see if there was any documentation of the settlement, the amount of the settlement, if the LPA has signed the administrative settlement, and the most important, the justification.

The settlement must be reasonable, prudent and in the public interest. Who signed the administrative settlement? The LPA must justify the settlement with written documentation which includes but not limited to, the new amount, any additional information brought forth by the property owner, appraisals, recent court awards, estimated trial costs or valuation problems.

We make sure that the LPA does not use the threat of condemnation as a reason for a settlement in every administration settlement they do in the project; because it under minds the appraisal process.

A copy of all conveying instruments/documents from each parcel file is reviewed to see if the property acquired is the same as the appraised and plans show. They are also looked to make sure that the correct instrument was used. We also make sure that if the LPA used Rights of Entry, Memo of Understanding, and/or Letter of Agreement have the approval of use from the ADOT Right of Way Liaison (this is a MUST AND IS NON-NEGOTIABLE).

If the LPA had to invoke the right of Eminent Domain we will require all condemnation documents, all notices, and copies of the proceedings, including but not limited to the “Order to Show Cause” and the “Order of Immediate Possession”.

This is the end of the Acquisition Section.

RELOCATION:

Relocation is governed by the Uniform Act 49 CFR Subpart C – F, 24.201 – 503.

A good relocation program has a reasonable and consistent balance of services and payments.

There are four key items in relocation; Plan the relocation, Provide advisory services, Issue the required notices, and Make the benefit payments. These are what we look for.The four (4) important aspects to all relocations, whether residential or non-residential (business):1. Planning; who will be displaced? What replacements are available? Are there any concurrent displacements? Are there any special needs? There MUST be a “Relocation Plan”.2. Advisory Services; Personal interview; explanation of benefits/services; the needs of those being displaced; referral to available property; referral to services and transportation is needed.3. Notices; General Information; notice of eligibility; ninety (90) day notice.4. Payments; Replacement housing; moving costs (these are for residential); reestablishment costs; in-lieu payment (non-residential).

Plan the move: 49 CFR 24.205(a); Local Public Agent (consultant) provides the plan

Who/how many will be displacedReplacements/comparables/DS&S (availability)Any special needs/problemsMust begin plan early in project

Advisory services: 49 CFR 24.205 (C)Explanation of benefitsPersonal interviewNeeds of the displacedReferral to available comparable housingTransportation to comparable housingReferral to other services

Notices: 49 CFR 24.203 (b & c)Written description of agency’s Relocation program;

See 49 CFR 24.203 (a) (1-5)General information noticeNotice of eligibility90 day notice

Residential (must have comparable housing at least 90 days prior to vacating)

Benefit payments: 49 CFR 24.207 Replacement housing

Moving costsReestablishment costsIn-lieu payment

The legislative reasoning behind the relocation program was that persons who are displaced should not have to bear a disproportionate burden for the benefit of the public; relocation payments and services mitigate this burden.

PLANNING STUDY DATA1) Assessor information.2) Input information on parcel sheets.3) Filed research, description, photo, etc.

3a) If a Business – interview and obtain survey information and attach to parcel sheet.

4) Insert field information and photo on parcel sheet.5) Research availability or replacement housing.

5a) Search for the same amount of houses for available for sale in area.6) Compile all relocation displacements for all projects.7) Report a final conclusion.

Property Categories:

Residential Residential-Single Family Residence and Mobile Home Vacant residential lotsCommercial - Business Commercial Business (regardless of zoning) Vacant land – if zoned commercialAgricultural Agricultural (crops) Agricultural vacant land Agricultural residential

RELOCATION PLAN REQUIREMENTSThe Federal Uniform Act Regulations found at 49CFR Part 24, specifically Reg. §24.205(a), set forth the requirements for a relocation plan. ADOT and all of its Local Public Agents shall plan the project in such a manner that recognizes the problems associated with the displacement of individuals and businesses and develop solutions to minimize the adverse impacts of displacement. The planning should be scoped to the complexity and nature of the anticipated displacing activity.

The planning may include the following:1. An estimate of the number of households to be displaced and

information such as owner/tenant status, estimated value and rental rates of properties to be acquired and special consideration of the impacts on minorities, the elderly, large families and personas with disabilities, 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.

3. An estimate of the number, type and size of businesses to be displaced and the approximate number of employees that may be affected.

4. An estimate of the availability of replacement business sites. When an adequate supply of replacement business sites is not expected to be available, the impacts of displacing the businesses should be considered and addressed. Planning for displaced business which are reasonable expected to involve complex or lengthy moving processes, or small businesses with limited financial resources and/or few alternative relocation sites, should include an analysis of business moving problems.

5. Consideration of any special relocation advisory services that may be necessary from ADOT and other cooperating Agencies.

We check to make sure if there was relocation, a relocation plan was developed. In compliance with the CFR.

REQUEST FOR PLAN STUDIES1. Plan study requested by Project Coordinator

Parcel information and right-of-way map provided by Project Coordinator

2. Right-of-way assigns.In-house Monitor

Assign to Agents/Consultant

3. Right of Way Group/Request for Relocation Plan/Estimates – Accordance with 24.205 (a)

Prepare estimate request and send to LPA PMDiscuss with consultant how they will submit bill

4. LPA PM sends letter requesting quote, scope of work and the Request for Relocation Plan/Estimates to Consultant for quote.

5. LPA PM reviews and approves.LPA PM sends to accounting for approval.

6. When approved, operation sends letter of approval and contract number to consultant.

7.ADOT PM Liaison and LPA PM monitor will be asked to review and approve when consultant has quote.

SAMPLE RELOCATION PLAN:

Relocation Plan for the (NAME) Project, a Relocation Plan in accordance with 49 CFR Part 24.205(a). The proposed project calls for construction of this Relocation Plan specifically addresses the impact of the Project’s land acquisition activities on the parcels of real property. Occupied parcels were identified that will be directly impacted by the acquisition of additional right of way or other less than fee interest for the Project.

Land acquisition and relocation assistance services required by the Project is to be provided in accordance with the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended (Uniform Act). ARS §§28-7141 through 28-7156 provided for implementation of the Federal Relocation Assistance Program on a State level, in compliance with the Uniform Act, a Relocation Plan is prepared.

This work plan for developing the Relocation Plan included interviews with the affected commercial business occupants and during which we essentially began the relocation advisory program. We inquired as to the relocation needs and preferences of each business and generally explained the relocation benefit and other assistance for which each may be eligible to the extent possible and, provided them with FHWA Acquisition and Relocation Brochures.

RELOCATION / DISPLACEMENTSResidentialParcel number: ___________________Assessors number: _________________ Type of Acquisition: Total Partial Owners Name: ____________________ Property address: _________________Taxes mailing address: _____________ (Possible tenant)Property Picture

Type of Property: Single Family Residence Apartment Complex Owner occupied Number of Units _______

Tenant Mobile Home Park 55+ Community

Number of Units _________Space No. _____________

Estimated Value: $__________Estimated Rent: $___________Comments: _______________________________________________________________

COMMERCIALParcel number: ___________________Assessors number: _________________ Type of Acquisition: Total Partial Owners Name: ____________________ Occupant: ________________________Property address: _________________Taxes mailing address: _____________ Property PictureType of Property: Single Family Residence Apartment Complex Owner occupied Number of Units _______

Tenant Mobile Home Park 55+ Community

Number of Units _________Space No. _____________

Estimated Value: $__________Estimated Rent: $___________Comments:

CONCLUSIONThe success of relocation of each household start with locating comparable housing, specifically (single family residence, apartment, and townhouses) that is:

Decent, safe and sanitary.Functionally equivalent of the displacement dwelling.Adequate in size to accommodate the occupants.In an area not subject to adverse environmental conditions.In a location not less desirable than the location of the displacement site with respect of public utilities, commercial and public facilities, and

reasonably accessible to the person’s place of employment.On a site typical in size for residential development.Currently available on the market.Within the financial means of the displaced person.

Our search of the market, it appears that there is ample comparable replacement residential property available, and any financial means issues would be address under the provisions of last resort housing as in (49 CFR 24.404).

Residential Tenant DisplacementsSecure title reports, assessor’s data, and other relevant information from the public domainInterview landowner/property manager to determine rental rates and secure rent rolls, if possibleConduct replacement housing study to determine the number of replacement dwellings in the area Consider housing of last resort actionsConsideration of any special relocation advisory servicesPhotograph displacement and possible replacement properties

Residential Owner-Occupant Displacements

Secure title reports, assessor’s data, and other relevant information from the public domainConduct MLS search to determine probable value of subjectInterview consenting owners to determine family composition and to consider the impact on large families, the elderly, persons with disabilities, and minoritiesConduct replacement housing study to determine the number of replacement dwellings in the areaConsider housing of last resort actionsConsideration of any special relocation advisory servicesPhotograph displacement and possible replacement properties

Business Displacements

Secure title reports, assessor’s data, and other relevant information from the public domain.Interview consenting business owners to determine the following, if relevant:

Number of employeesReplacement site requirementsCurrent lease termsFinancial capacityTime required to vacateEase/difficulty in locating a replacement site

Conduct a search utilizing local realtors and the MLS to estimate the availability of replacement sites.Consideration of any special relocation advisory services.Photograph displacement and possible replacement properties.

Parcel-by-parcel discussion

PREPARATION AND DELIVERY OF RELOCATION PLAN

The final task is to prepare and deliver to the Department the written Relocation Plan, which will contain the following elements:

IntroductionRelocation Plan requirementsIdentification of project impacts

BusinessIdentification dataDescription of business activityPrincipal planning concernsSolutions and mitigation measures

ResidentialIdentification of owner-occupants

Description of improvements/household compositionPrincipal planning concernsSolutions and mitigation measuresAvailability of replacement property in the market areaConclusionAppendix/Supporting data

We double check all facets of the relocation plan and the move.

Real Property Management:(49 CFR 23.710.401 & 403)

The purpose of this code is to ensure the prudent use of Federal Funds in acquisition, property management, and disposal of real property.Definition: Property management is the administration of acquired lands and improvements, including:

Maintenance and protection, such as the repair of dangerous conditions and preventing illegal occupancy.Rental and leasing of acquired property; if property is not needed immediately, it can be used to produce income. Income must be applied to Title 23 Eligible Projects.Disposal of property no longer needed for the project, such as excess parcels, remnants, old right-of-way and structures for salvage. Revenue must be applied to Title 23 Eligible Projects.

This section introduces participants to property management activities the LPA may conduct after acquiring Real Property.A Property Management Plan MUST be prepared that outlines provisions for Maintenance, Protection, and Illegal Occupancy.The Plan also needs to address the Disposal of unneeded property, Old Right of Way, and Structures to be salvaged, if appropriate.

The LPA must assure that all real property within the boundaries of a Federally Funded facility is devoted exclusively to the purpose of that facility and is preserved free of all other public or private uses; unless such uses are permitted by Federal regulation or the FHWA.

LPAs SHALL charge current market value or rent for the use or disposal of real property interests, including access control.

Any monies derived from the sale, rent or lease of excess real property or of any real property acquired with Federal Funds, the monies MUST be put into the project or another Title 23 project.

Project Property Management begins before and continues throughout the property acquisition process and continues after the project is constructed.

Activities include: Record keeping and inventory of the lands, buildings, fixtures, and other assets that are conveyed with the real property in the purchase agreement. Real property maintenance, including landscaping, clearing, demolition, security, pest control, etc.

Post-acquisition property management continues after the LPA has purchased and taken title to the property. Activities include: Leasing or sale of surplus real property for short or long-term usage.Post-construction property management includes such activities as:

Controlling and removing encroachments on the right-of-way.Approval of lease/ sale of highway airspace (joint use agreements),

Access management

Sale or Lease of Excess Land.

Occupant retention or carryovers of a tenant. Real property maintenance, including landscaping, clearing, demolition, security, pest control, etc. The sale of improvements is common when the improvement is not needed for the road project. The improvements can be “sold back” to their original owner or sold to a third party. The improvements are typically either moved or salvaged for materials.

We check for all these things when there has been “Property Management”.

NOTE: We have only seen a few of the LPAs use Property Management.Most LPAs do not use Property Management, they usually only buy what they need.

The ROW sections of the ADOT/LPA manual do have procedures for determining when a real property interest is no longer needed.

The LPA should be reminded to coordinate with the State Department of Transportation’s Right of Way Liaison, as the State Department of Transportation’s approval may be required for joint use and access management agreements.

Please check the website listed below for all kinds of valuable information concerning acquisition and relocation.

www.azdot.gov/highways/row/project.asp

QUESTIONS ?

QUESTIONS ???QUESTIONS ?????

Louis J. Malloque, Right of Way Agent III,

ADOT Liaison to the Local Public Agents(602) 712-8755

lmalloque@azdot.gov

All slides prepared by Louis Malloque & Jim Stoleson