Appendix A to Part 24 - —Additional Information

Appendix A to Part 24—Additional Information

This appendix provides additional information to explain the intent of certain provisions of this part.

Subpart A—General

Section 24.2 Definitions and Acronymsacronyms.

Section 24.2(a) Comparable replacement dwelling, (

6

ii)

Definition of comparable replacement dwelling

. The requirement

in § 24.2(a)(6)(ii)

that a comparable replacement dwelling be “functionally equivalent” to the displacement dwelling, means that it must perform the same function

,

and provide the same utility.

While

The section states that it need not possess every feature of the displacement dwelling. However, the principal features must be present.

For example, if the displacement dwelling contains a pantry and a similar dwelling is not available, a replacement dwelling with ample kitchen cupboards may be acceptable. Insulated and heated space in a garage might prove an adequate substitute for basement workshop space. A dining area may substitute for a separate dining room. Under some circumstances, attic space could substitute for basement space for storage purposes, and vice versa.

Only in unusual circumstances may a comparable replacement dwelling contain fewer rooms or, consequentially, less living space than the displacement dwelling. Such may be the case when a decent, safe, and sanitary replacement dwelling (which by definition is “adequate to accommodate” the displaced person) may be found to be “functionally equivalent” to a larger but very run-down substandard displacement dwelling. Another example is when a displaced person accepts an offer of

government

Government housing assistance and the applicable requirements of such housing assistance program require that the displaced person occupy a dwelling that has fewer rooms or less living space than the displacement dwelling.

Section 24.2(a)

(6)(

Comparable replacement dwelling, (vii). The definition of comparable replacement dwelling requires that a comparable replacement dwelling for a person, who is not receiving assistance under any

government

Government housing program before displacement, must be currently available on the private market without any subsidy under a

government

Government housing program.

Section 24.2(a)

(6)(ix). A public housing unit may qualify as a comparable replacement dwelling only for a person displaced from a public housing unit. A privately owned dwelling with a housing program subsidy tied to the unit may qualify as a comparable replacement dwelling only for a person displaced from a similarly subsidized unit or public housing.

A housing program subsidy that is paid to a person (not tied to the building), such as a HUD Section 8 Housing Voucher Program, may be reflected in an offer of a comparable replacement dwelling to a person receiving a similar subsidy or occupying a privately owned subsidized unit or public housing unit before displacement.

However, nothing in this part prohibits an Agency from offering, or precludes a person from accepting, assistance under a government housing program, even if the person did not receive similar assistance before displacement. However, the Agency is obligated to inform the person of his or her options under this part. (

Comparable replacement dwelling, (ix). If a person accepts assistance under a

government

Government housing assistance program, the rules of that program governing the size of the dwelling apply, and the rental assistance payment under § 24.402 would be computed on the basis of the person's actual out-of-pocket cost for the replacement housing

.)

and associated utilities after the applicable Government assistance has been applied.

Section 24.2(a)

(8

Decent, safe, and sanitary, (i)(

ii

A)

Decent, Safe and Sanitary. Many local housing and occupancy codes require

. Even where Federal or local law does not mandate adherence to standards requiring the abatement of deteriorating paint, including lead-based paint and lead-based paint dust,

in protecting the public health and safety. Where such standards exist, they must be honored. Even where local law does not mandate adherence to such standards,

it is strongly recommended that they be considered as a matter of public policy.

Section 24.2(a)

(8)(vii) Persons with a disability

Decent, safe, and sanitary, (v). Some local code standards for occupancy do not require kitchens. However, selection of comparable dwellings that provide a kitchen is recommended. The FHWA believes this is good practice and in most cases should be easily achievable. If the displacement dwelling had a kitchen, the comparable dwelling must have a kitchen. If the displacement dwelling did not have a kitchen but local code standards for occupancy require one, the comparable dwelling must contain a kitchen. If the displacement dwelling did not have a kitchen and local code standards for occupancy do not require one, an agency does not have to provide a kitchen in the comparable dwelling. If a kitchen is provided in the comparable dwelling, at a minimum it must contain a fully usable sink, properly connected to potable hot and cold water and to a sewage drainage system, and adequate space and utility service connections for a stove and refrigerator.

Section 24.2(a) DSS—Persons with a disability, (vii). Reasonable accommodation of a displaced person with a disability at the replacement dwelling means the

Agency

agency is required to address comparability for persons with a physical impairment that substantially limits one or more of the major life activities. In these situations, reasonable accommodation should include the following at a minimum: Doors of adequate width; ramps or other assistance devices to traverse stairs and access bathtubs, shower stalls, toilets and sinks; storage cabinets, vanities, sink and mirrors at appropriate heights. Kitchen accommodations will include sinks and storage cabinets built at appropriate heights for access. The

Agency

agency shall also consider other items that may be necessary, such as physical modification to a unit, based on the displaced person's needs.

Section 24.2(a)(9)(ii)(D) Persons not displaced. Paragraph (a)(9)(ii)(D) of this section recognizes that there are circumstances where the acquisition, rehabilitation or demolition of real property takes place without the intent or necessity that an occupant of the property be permanently displaced. Because such occupants are not considered “displaced persons” under this part, great care must be exercised to ensure that they are treated fairly and equitably. For example, if the tenant-occupant of a dwelling will not be displaced, but is required to relocate temporarily in connection with the project, the temporarily occupied housing must be decent, safe, and sanitary and the tenant must be reimbursed for all reasonable out-of-pocket expenses incurred in connection with the temporary relocation. These expenses may include moving expenses and increased housing costs during the temporary relocation. Temporary relocation should not extend beyond one year before the person is returned to his or her previous unit or location. The Agency must contact any residential tenant who has been temporarily relocated for a period beyond one year and offer all permanent relocation assistance. This assistance would be in addition to any assistance the person has already received for temporary relocation, and may not be reduced by the amount of any temporary relocation assistance.

Similarly, if a business will be shut-down for any length of time due to rehabilitation of a site, it may be temporarily relocated and reimbursed for all reasonable out of pocket expenses or must be determined to be displaced at the Agency's option.

Any person who disagrees with the Agency's determination that he or she is not a displaced person under this part may file an appeal in accordance with 49 CFR part 24.10 of this regulation.

Section 24.2(a)(11) Dwelling Site. This definition ensures that the computation

Requirements include but are not limited to Fair Housing Act (FHA), 42 U.S.C. 3604 (f)(3)(A)-(C), and/or HUD's regulations for newly constructed assisted housing under section 504, 24 CFR 8.22.

Section 24.2(a) Displaced person—Occupants of a temporary, daily, or emergency shelter, (iii)(L). Shelters can serve many purposes, and each will have specific rules and requirements as to who can occupy or use the shelter and whether prolonged and continuous occupancy is allowed. Persons who are occupying a shelter that only allows overnight stays and requires the occupants to remove their personal property and themselves from the premises on a daily basis and that offers no guarantee of reentry in the evening typically would not meet the definition of displaced persons as used in this part, nor would the shelter meet the definition of dwelling as used in this part. Persons who live at the shelter on a continuous, prolonged, or permanent basis may be considered displaced. These determinations are fact-based determinations. Facts that might assist in the determination include whether the person is employed because they work to pay their rent or there may be a residential landlord-tenant relationship. The FHWA expects it would be unusual to displace a shelter occupant who meets the criteria for making a determination that he or she is a displaced person. Agencies should make reasonable effort to provide information about proposed vacation date or other plans for the shelter to relocate. Providing advisory assistance to shelter occupants may be a challenge due to the transient nature of shelter occupancy, but such assistance must be provided to the maximum extent practicable.

Section 24.2(a) Dwelling site. This definition ensures that the computations of replacement housing payments are accurate and realistic

(a) when the dwelling is located on a larger than normal site,

(b) when mixed-use properties are acquired,

(c) when more than one dwelling is located on the acquired property, or

(d) when the replacement dwelling is retained by an owner and moved to another site.

Section 24.2(a)

(14)

Household income (exclusions). Household income for purposes of this

regulation

part does not include program benefits that are not considered income by Federal law such as food stamps and the Women Infants and Children

(WIC)

program. For a more detailed list of income exclusions see

Federal Highway Administration

FHWA, Office of Real Estate Services

Web site: http://www.fhwa.dot.gov/realestate/. (FR 4644-N-16 page 20319 Updated.) If

website.^[1] Contact the Federal agency administering the program if there is a question on whether

or not

to include income from a specific program

contact the Federal Agency administering the program

.

Section 24.2(a)

(15)

Initiation of negotiations. This section provides a special definition for acquisition and displacements under

Pub. L.

Public Law 96-510 or Superfund. The order of activities under Superfund may differ slightly in that temporary relocation may precede acquisition. Superfund is a program designed to clean up hazardous waste sites. When such a site is discovered, it may be necessary, in certain limited circumstances, to alert individual owners and tenants to potential health or safety threats and to offer to temporarily relocate them while additional information is gathered. If a decision is later made to permanently relocate such persons, those who had been temporarily relocated under Superfund authority would no longer be on site when a formal, written offer to acquire the property was made, and thus would lose their eligibility for a replacement housing payment. In order to prevent this unfair outcome,

we have

FHWA has provided a definition of initiation of negotiation, which is based on the date the Federal Government offers to temporarily relocate an owner or tenant from the subject property.

Section 24.2(a)

(15)(iv)

Initiation of negotiations, Tenants, (

Tenants

iv).

)

Tenants who occupy property that may be voluntarily acquired

amicably

, without recourse to the use of the power of eminent domain, must be fully informed as to their potential eligibility for relocation assistance

. This includes notifying such tenants of their potential eligibility

when negotiations are initiated

, notifying them if they become fully eligible, and, in the event the purchase of the property will not occur, notifying them that they are no longer eligible for relocation benefits. If a

. If negotiations fail to result in a binding agreement the agency should notify tenants that negotiations have failed to result in a binding agreement and that the agency has concluded its efforts to acquire the property. If a tenant is not readily accessible, as the result of a disaster or emergency, the agency must provide these notifications and document its efforts in writing. As used in this definition, agreements such as options to purchase and conditional purchase and sale agreements are not considered binding agreements until all conditions to the agency's obligation to purchase the real property have been satisfied. A right to purchase property is not binding agreement because it does not require the State to purchase the property necessary for the project unless they elect to do so. A binding agreement as used in this definition is a legally enforceable document in which the property owner agrees to sell certain property rights necessary for a project and the agency agrees, without further election, to make that purchase. If negotiations fail to result in a binding agreement the agency should notify tenants that negotiations have failed to result in a binding agreement and that the agency has concluded its efforts to acquire the property. If a tenant is not readily accessible, as the result of a disaster or emergency, the

Agency

agency must make a good faith effort to provide these notifications and document its efforts in writing.

Applications for many Federal programs permit site control to be demonstrated by option contracts. Once the application for Federal financial assistance is approved, the acquiring agency must execute the purchase contract to receive the Federal financial assistance for the program or project. Therefore, if the purchase agreement satisfies the site control requirements of the Federal agency providing the Federal financial assistance, then the application date is the date of the initiation of negotiations for that program or project. Setting the initiation of negotiations at the earlier of the date of application or when all conditions to the obligation to purchase the real property have been satisfied, ensures that residents of a project are treated fairly, given that application approval and the ultimate sale of the property could be as long as six months to a year after the application date taking into account the application review and processing periods.

A binding agreement as used in this section is a legally enforceable document in which the property owner agrees to sell certain property rights necessary for a project and the agency agrees to that purchase for a specified consideration.

Section 24.2(a)

(17)

Mobile home.In this part, the term “mobile home” will continue to be used to include those homes that are defined at 24 CFR part 3280 as a “manufactured home.”

Regulations at 24 CFR 3280.2 defines “manufactured home.” The term “mobile home” was changed to “manufactured home” in 24 CFR part 3280 in 1979.

The following examples provide additional guidance on the types of mobile homes

and manufactured housing

that can be found acceptable as

comparable

replacement dwellings for persons displaced from mobile homes. A recreational vehicle that is capable of providing living accommodations may be considered a replacement dwelling if the following criteria are met: the recreational vehicle is purchased and occupied as the “primary” place of residence; it is located on a purchased or leased site and connected to or

have

has available all necessary utilities for functioning as a housing unit on the date of the

displacing Agency

agency's inspection; and, the dwelling, as sited, meets all local, State, and Federal requirements for a decent, safe, and sanitary dwelling. (The regulations of some local jurisdictions will not permit the consideration of these vehicles as

decent, safe and sanitary

DSS dwellings. In those cases, the recreational vehicle will not qualify as a replacement dwelling.)

For HUD programs, mobile home is defined as “a structure, transportable in one or more sections, which, in the traveling mode, is eight body feet or more in width or forty body feet or more in length, or, when erected on site, is three hundred or more square feet, and which is built on a permanent chassis and designed to be used as a dwelling with or without a permanent foundation when connected to the required utilities and includes the plumbing, heating, air-conditioning, and electrical systems contained therein; except that such terms shall include any structure which meets all the requirements of this paragraph except the size requirements and with respect to which the manufacturer voluntarily files a certification required by the Secretary of HUD and complies with the standards established under the National Manufactured Housing Construction and Safety Standards Act, provided by Congress in the original 1974 Manufactured Housing Act.” In 1979 the term “mobile home” was changed to “manufactured home.” For purposes of this regulation, the terms mobile home and manufactured home are synonymous.

When assembled, manufactured homes built after 1976 contain no less than 320 square feet. They may be single or multi-sectioned units when installed. Their designation as personalty or realty will be determined by State law. When determined to be realty, most are eligible for conventional mortgage financing.

The 1976 HUD standards distinguish manufactured homes from factory-built “modular homes” as well as conventional or “stick-built” homes. Both of these types of housing are required to meet State and local construction codes.

Section 24.3 No Duplication of Payments. This section prohibits an Agency from making a payment to a person under these regulations that would duplicate another payment the person receives under Federal, State, or local law. The Agency is not required to conduct an exhaustive search for such other payments; it is only required to avoid creating a duplication based on the Agency's knowledge at the time a payment is computed.

Subpart B—Real Property Acquisition

Federal Agencies may find that, for Federal

Section 24.3 No duplication of payments. This section prohibits an agency from making a payment to a person under this part that would duplicate another payment the person receives under Federal, State, or local law. The agency is not required to conduct an exhaustive search for such other payments; it is only required to avoid creating a duplication based on the agency's knowledge at the time a payment is computed.

Section 24.5 Manner of Notices and Electronic Signatures. Property owners or occupants must voluntarily elect to receive notices, offers, correspondence and information via electronic methods. Alternatively, property owners or occupants may request delivery of notices, offers, correspondence and information via certified or registered first class mail, return receipt requested, instead of electronic means. Agencies must accommodate the property owner's or occupant's preference. The FHWA continues to believe that providing notices, offers, correspondence and information by either first-class mail or electronic means should not be used as a substitute for face-to-face meetings, but rather as a supplemental means of communication that accommodates an owner's or occupant's preference.

An agency must be able to demonstrate to the Federal funding agency the ability to securely document the notice delivery and receipt confirmation in order to receive approval from the Federal funding agency for use of electronic delivery of notices, offers, correspondence, information, and electronic signature. Additional minimum safeguards that the agency must put in place prior to delivering notices, offers, correspondence, and information by electronic means and for the use of electronic signatures are included in the regulation at § 24.5. Prior to the use of electronic delivery or electronic signature, there must be an agency process or procedure outlined in writing and approved by the Federal funding agency that details the requirements and rules the agency will follow when using electronic means for delivery of notices, offers, correspondence, and information. Should an agency decide to allow electronic signature the agency must develop procedures to ensure that signatures can be verified and documented appropriately. The FHWA understands that certain documents that are essential to the conveyance of the real property interests may not allow for electronic signature(s).

Agencies must determine and document instances when electronic deliveries of notices or use of electronic signature are appropriate. An example of an appropriate use of electronic delivery of notices, offers, correspondence, and information might be to notify a property owner of his or her right to accompany an appraiser as required at § 24.102(c)(1). Other appropriate uses may be to secure a release of mortgage or to confirm a property owners' receipt of the acquisition and relocation brochures.

An example of when the use of electronic delivery or electronic signatures may not be appropriate is when the document being signed requires notarization or other similar verification. Electronic delivery of notices, offers, correspondence, and information may not always be a good option for relocation assistance where many actions are conducted in person at the displacement or replacement dwelling or business and require advisory services to be provided as part of the process. The FHWA notes that relocation assistance in part requires ongoing and continuous advisory services be provided (§ 24.205(c)). This may be best accomplished by face to face meetings during which the displaced person may more easily raise questions, request assistance, or indicate a need for additional advisory assistance.

These examples are not intended to be all-inclusive, nor are they exclusive of other opportunities to use this tool. For additional information, the specific Federal regulations that set out the format and examples for an electronic signature can be found at 37 CFR 1.4(d)(2). The regulations in 37 CFR 1.4(d)(2) fall under the purview of the United States Patent and Trademark Office, which provides examples of what is considered to be proper format in a variety of electronically signed documents.

Section 24.9(c) Reports. Moving Ahead for Progress in the 21st Century Act (MAP-21) amended 42 U.S.C. 4633(b)(4) to require that each Federal agency subject to the Uniform Act submit an annual report describing activities conducted by the Federal agency. The FHWA believes that such a report that details activity provides a good indication of program health and scope.

FHWA realizes that not all agencies subject to this reporting requirement currently have the ability to collect all information requested on the reporting form. However, Federal agencies may elect to provide a narrative report that focuses on their respective efforts to improve and enhance delivery of Uniform Act benefits and services. Narrative report information would include information on training offered, reviews conducted, or technical assistance provided to recipients.

Agencies are not required by the Uniform Act to keep records of their efforts to improve the housing conditions of economically disadvantaged persons. However, agencies must ensure that their relocations are carried out in a manner which is consistent with the requirements of section 4621 of the Uniform Act.

Section 24.11 Adjustment of Limits and Payments. FHWA will use the Consumer Price Index for All Urban Consumers (CPI-U) Seasonally Adjusted to determine if inflation, cost of living or other factors indicate that an adjustment to relocation benefits is warranted.

Sample calculation:

Assume CPI-U was 110.0 when the final rule was published. The fixed payment for nonresidential moving expenses has a ceiling of $53,200. During a subsequent evaluation after publication of the final rule, the CPI-U is calculated to be 115.5.

Divide the new index by the base year index = 115.5/110.0 = 1.050 or 5 percent. This means there has been a 5 percent increase in prices and the fixed payment for nonresidential moving expenses ceiling should be increased 5 percent.

Calculate fixed payment benefit ceiling = $53,200 × 1.05 = $55,860.

Subpart B—Real Property Acquisition

For Federal eminent domain purposes, the terms “fair market value” (as used throughout this subpart) and “market value,” which may be the more typical term in private transactions, may be are synonymous.

Section 24.101(a) Direct Federal program or project. All 49 CFR Part 24 Subpart B the requirements in subpart B of this part (real property acquisition) requirements apply to all direct acquisitions for Federal programs and projects by Federal Agenciesagencies, except for acquisitions undertaken by the Tennessee Valley Authority or the Rural Utilities Service. There are no exceptions for “voluntary transactions.”

Section 24.101(b)(1)(i)

. The term “general geographic area” is used to clarify that the “geographic area” is not to be construed to be a small, limited area.

Sections 24.101(b)(1)(iv) and

(2) (ii). These sections provide

(B). This section provides that, for programs and projects receiving Federal financial assistance described in

§§

§ 24.101(b)(1)

and (2)

,

Agencies

agencies are to inform the owner(s) or their designated representative(s) in writing of the

Agency

agency's estimate of the fair market value for the property to be acquired.

Section 24.101(b)(1)(i)(B). While this part does not require an appraisal or waiver valuation for these transactions,

Agencies

agencies may still decide that an appraisal or waiver valuation is necessary to support their determination of the fair market value of these properties, and, in any event,

Agencies must have

persons developing a waiver valuation must have sufficient knowledge of the local market (§ 24.102(c)(2)(ii)(B)) in order to establish some reasonable basis for their determination of fair market value. In addition, some of the concepts inherent in Federal Program appraisal practice are appropriate for these

estimates

determinations. It would be appropriate for

Agencies

agencies to adhere to project influence restrictions, as well as guard against discredited “public interest value” valuation concepts.

After an

Agency

agency has established an amount it believes to be the fair market value of the property and has notified the owner of this amount in writing, an

Agency

agency may negotiate freely with the owner in order to reach agreement. Since these transactions are voluntary, accomplished by a willing buyer and a willing seller, negotiations may result in agreement for the amount of the original estimate, an amount exceeding it, or for a lesser amount. Although not required by

the regulations

this part, it would be entirely appropriate for

Agencies to

agencies to ensure that estimates of fair market value are documented and shared with the property owner during negotiations, and to apply the administrative settlement concept and procedures in § 24.102(i) to negotiate amounts that exceed the original estimate of fair market value. Agencies shall not take any coercive action in order to reach agreement on the price to be paid for the property.

There may be an extraordinary circumstance in which use of eminent domain may be necessary. In those instances, the Federal funding agency may consider granting a waiver of regulations in this part under authority of § 24.7. The Federal funding agency will make a fact based, case by case determination as to whether a waiver of this part's requirements may be allowed.

Section 24.101(b)(1)(ii). The term “general geographic area” is used to clarify that an agency carrying out a project or program can achieve the purpose of the project or program by purchasing any of several properties that are not necessarily contiguous or are not limited to a specific group of properties.

Section 24.101(b)(1)(ii) and (iii)—nexus. The funding agency should review the acquisition records and consider the relevant facts for the properties acquired to determine if the intent of the acquisition was to incorporate the real property into, or in some other way support or otherwise advance, a Federal or federally assisted program or project. If the property was acquired by other means (e.g., local government acquisition via tax delinquency or exaction), documentation may be provided to show that the property was not acquired with the intent of including it in a Federal or federally assisted program or project. However, if at the time of acquisition, there is a nexus between the property's acquisition and a Federal or federally assisted program or project and if the intent was to acquire the property for a Federal or federally assisted program or project, the Uniform Act requirements must be followed to maintain Federal eligibility. If the agency is certain that eminent domain authority will not be used for the intended project or program, then the limited requirements of voluntary acquisition would apply. The agency must also consider that acquiring the property and applying only the voluntary acquisition requirements would in most cases preclude the agency from later using eminent domain authority to acquire the property should voluntary acquisitions not result in an agreement to sell the property to the agency. (See also discussion in 24.101(b)(1)(i)(B) of this appendix.)

Section 24.101(b)(1)(iii) Private entities who acquire property to create wetlands. Private entities who acquire property to create wetlands for wetland banking purposes cannot be required to comply with the Uniform Act if there is no planned or anticipated use by a Federal or federally assisted program or project. Establishment of such wetland banks, which may include a Federal or federally funded project or program among its future users, do not necessarily trigger application of the Uniform Act requirements.

There is not one answer that fits all third-party (private entities) environment mitigation scenarios. These determinations are fact-based by nature. However, the key issue is whether the acquisition of property for wetlands is specifically for mitigation of impacts on Federal or federally assisted programs or projects. When making a fact-based determination, the purpose of the wetland bank, the existence of any agency funding for the bank or commitment to use the bank, and whether the wetland bank restricts who may purchase mitigation credits from it, are among the factors to consider in determining applicability of Uniform Act requirements.

If an agency provides Federal financial assistance for creating a wetland bank or has a prior agreement that the banked wetlands will be used to mitigate impacts on a specific Federal or federally assisted programs or projects, then the property acquisitions for the wetland bank must conform to Uniform Act requirements. If an agency contracts with a private third-party provider which does not use the power of eminent domain, the acquisition may qualify for treatment as a voluntary acquisition and only the limited requirements as set forth in § 24.101(b)(1) would apply.

If the wetland bank proposal has received necessary permits and was established without any Federal funding participation prior to use of Federal funds for acquisition of wetland mitigation credits and was not planned to be used only for mitigation of impacts due to Federal and federally assisted projects and programs, the Uniform Act requirements do not apply. The actions which the wetland bank developer took in carrying out their private activity can be viewed with regard to the Uniform Act in the same manner as other actions taken by private parties without the anticipated or actual benefit of Federal financial assistance.

Section 24.101(c) Less-than-full-fee interest in real property. This provision Section 24.101(c) provides a benchmark beyond which the requirements of the subpart clearly apply to leases.

Section 24.102(b) Notice to owner. In the case of condominiums and other types of housing with common or community areas, notification should be given to the appropriate parties. The appropriate parties could be a condominium or homeowner's board, a designated representative, or all individual owners when common or community property is being acquired for the project.

Section 24.102(c)(2) Appraisal, waiver thereof, and invitation to owner. The purpose of the appraisal waiver provision is to provide Agencies agencies a technique to avoid the costs and time delay associated with appraisal requirements for low-value, non-complex acquisitions. uncomplicated valuation problems within the low fair market value limits established in this part. In most cases, uncomplicated valuation problems are considered to be those involving unimproved strips of land. Acquisitions involving improvements, damages, changes of highest and best use, or significant costs to cure are considered to be complicated and, as such, are beyond the application of waiver valuations as contemplated in this part. The intent is that non-appraisers make the waiver valuations, freeing appraisers to do more sophisticated complex work.

The Agency employee agency representative making the determination to use the appraisal waiver process valuation option must have enough understanding of appraisal principles, techniques, and use of appraisals to be able to determine whether or not the proposed acquisition is uncomplicated and within the low value and uncomplicatedfair market value limits in this part.

Waiver valuations are not appraisals as defined by the Uniform Act and these regulationsthis part; therefore, appraisal performance requirements or standards, regardless of their source, are not required for waiver valuations by this rulepart. Since waiver valuations are not appraisals, neither is there a requirement for an appraisal review. However, the Agency Agencies should put procedures in place to ensure that waiver valuations are accurate and that they are consistent with the unit values on the project as determined by appraisals and appraisal reviews. The agency must have a reasonable basis for the waiver valuation and an Agency agency official must still establish an amount believed to be just compensation to offer the property owner(s) (see § 24.102(d)).

The definition of “appraisal” in the Uniform Act and appraisal waiver valuation provisions of the Uniform Act and these regulations this part are Federal law and public policy and should be considered as such when determining the impact of appraisal requirements levied by others.

Section 24.102(d) Establishment of offer of just compensation. The initial offer to the property owner may not be less than the amount of the Agencyagency's approved appraisal , or waiver valuation of the fair market value of the property but may exceed that amount if the Agency agency determines that a greater amount reflects just compensation for the property.

Section 24.102(f) Basic negotiation procedures. An offer should be adequately presented to an owner, and the owner should be properly informed. Personal, face-to-face contact should take place, if feasible, but this section does not require such contact in all cases.

This section also provides requires that the property owner be given a reasonable opportunity to consider the Agencyagency's offer and to present relevant material to the Agencyagency. In order to satisfy this requirement, Agencies the requirement in § 24.102(f), agencies must allow owners time for analysis, research and development, and compilation of a response, including perhaps getting an appraisal. The needed time can vary significantly, depending on the circumstances, but thirty ( 30 ) days would seem to be the minimum time these actions can be reasonably expected to require. Regardless of project time pressures, property owners must be afforded this opportunity.

In some jurisdictions, there is pressure to initiate formal eminent domain procedures at the earliest opportunity because completing the eminent domain process, including gaining possession of the needed real property, is very time consuming. These provisions The provisions of § 24.102(f) are not intended to restrict this practice, so long as it does not interfere with the reasonable time that must be provided for negotiations, described abovein § 24.102(f), and the Agencies agencies adhere to the Uniform Act ban on coercive action Section 4651(section 301(7) of the Uniform Act and § 24.102(h)).

If the owner expresses intent to provide an appraisal report, Agencies agencies are encouraged to provide the owner and/or his/her their appraiser a copy of Agency agency appraisal requirements and inform them that their appraisal should be based on those requirements.

Section 24.102(i) Administrative settlement. This section provides guidance on administrative settlement as an alternative to judicial resolution of a difference of opinion on the value of a property , in order to avoid unnecessary litigation and congestion in the courts.

All relevant facts and circumstances should be considered by an Agency agency official delegated this authority. Appraisers, including review appraisers, must shall not be pressured unduly influenced or coerced to adjust their an estimate of value for the purpose of justifying such settlements (see § 24. Such action would invalidate the appraisal process102(n)(2)). Such actions are contrary to the requirements of this part and to the overarching goal of providing just compensation.

Section 24.102(j) Payment before taking possession. It is intended that a right-of-entry for construction purposes be obtained only in the exceptional case, such as an emergency project, when there is no time to make an appraisal and purchase offer and the property owner is agreeable to the process.

Section 24.102(m) Fair rental. Section 3014651(6) of the Uniform Act limits what an Agency agency may charge when a former owner or previous occupant of a property is permitted to rent the property for a short term or when occupancy is subject to termination by the Agency agency on short notice. Such rent may not exceed “the fair rental value of the property to a short-term occupier.” Generally, the Agencyagency's right to terminate occupancy on short notice (whether or not the renter also has that right) supports the establishment of a lesser rental than might be found in a longer, fixed-term situation.

Section 24.102(n) Conflict of interest. The overall objective is to minimize the risk of fraud, waste, and abuse while allowing Agencies agencies to operate as efficiently as possible. There are three parts to this the provision in § 24.102(n).

The first provision is the prohibition against having any interest in the real property being valued by the appraiser (for an appraisal), the valuer (for a waiver estimatevaluation), or the review appraiser (for an appraisal review).)

The second provision is that no person functioning as a negotiator for a project or program can supervise or formally evaluate the performance of any appraiser, waiver valuation preparer, or review appraiser performing appraisal, waiver valuation, or appraisal review work for that project or program. The intent of this provision is to ensure appraisal and/or waiver valuation independence and to prevent inappropriate influence. It is not intended to prevent Agencies agencies or recipients from providing appraisersappraiser and/or waiver valuers with appropriate project information and or participating in determining the scope of work for the appraisal or waiver valuation. For a program or project receiving Federal financial assistance, the Federal funding Agency agency may waive this requirement if it would create a hardship for the Agencyagency or recipient. The intent is to accommodate Federal -financial aid recipients that have a small staff where this provision would be unworkable.

The third provision is to minimize situations where administrative costs exceed acquisition costs. Section 24.102(n) also provides that the same person may prepare perform a waiver valuation estimate (including an or appraisal ) and negotiate that acquisition, if the waiver valuation or appraisal estimate amount is $10$15,000 or less. However, it should be noted that this exception for properties valued at $10,000 or less is not mandatory, e.g., Agencies Agencies or recipients are not required to use those who prepare perform a waiver valuation or appraisal of $10$15,000 or less to negotiate the acquisition, and, all . All appraisals must be reviewed in accordance with § 24.104. This includes appraisals of real property valued at $10$15,000, or less.

The third provision has been expanded to allow Federal funding agencies to permit use of a single agent for values of more than $15,000, but less than $35,000, but, as a safeguard, requires that an appraisal and appraisal review be done if the waiver valuation preparer or the appraiser will also act as the negotiator. Agencies or recipients desiring to exercise this option must request approval in writing from the Federal funding agency. The requesting agency shall have a separate and distinct quality control process for implementing this authority in place and set forth in the written procedures approved by the Federal funding agency. Agencies and recipients may delegate this authority to a subrecipient to use their approved authority if the subrecipient has an agency or recipient approved oversight mechanism to assure proper use and review of the authority.

Section 24.103 Criteria for Appraisals. The term “requirements” is used throughout this section to avoid confusion with The Appraisal Foundation's Uniform Standards of Professional Appraisal Practice (USPAP) “standards.” Although this section discusses appraisal requirements, the definition of “appraisal” itself at § 24.2(a) (3) includes appraisal performance requirements that are an inherent part of this section.

The term “Federal and federally - assisted program or project” is used to better identify the type of appraisal practices that are to be referenced and to differentiate them from the private sector, especially mortgage lending, appraisal practice.

Section 24.103(a) Appraisal requirements. The first sentence instructs readers that requirements for appraisals for Federal and federally - assisted programs or projects are located in 49 CFR this part 24. These are the basic appraisal requirements for Federal and federally - assisted programs or projects. However, Agencies agencies may enhance and expand on them, and there may be specific project or program legislation that references other appraisal requirements.

These The appraisal requirements in § 24.103(a) are necessarily designed to comply with the Uniform Act and other Federal eminent domain based appraisal requirements. They are also considered to be consistent with Standards Rules 1, 2, 3, and 3 4 of the 2004 edition of the USPAP. Consistency with USPAP has been a feature of these appraisal requirements since the beginning of USPAP. This “consistent” relationship was more formally recognized in Office of Management and Budget (OMB) Bulletin 92-06. While these requirements are considered consistent with USPAP, neither can supplant the other; their provisions are neither identical, nor interchangeable. Appraisals performed for Federal and federally - assisted real property acquisition must follow the requirements in this regulationpart. Compliance with any other appraisal requirements is not within the purview of this regulationpart. An appraiser who is committed to working within the bounds of USPAP should recognize that compliance with both USPAP and these the requirements in this part may be achieved by using the Supplemental Standards Scope of Work Rule and the Jurisdictional Exception Rule of USPAP, where applicable.

The term “scope of work” defines the general parameters of the appraisal. It reflects the needs of the Agency agency and the requirements of Federal and federally - assisted program appraisal practice. It should be developed cooperatively by the assigned appraiser and an Agency agency official who is competent to both represent the Agencyagency's needs and respect valid appraisal practice. The scope of work statement should include the purpose and/or function of the appraisal, a definition of the estate being appraised, and if whether it is fair market value, its applicable definition, and the assumptions and limiting conditions affecting the appraisal. It may include parameters for the data search and identification of the technology, including approaches to value, to be used to analyze the data. The scope of work should consider the specific requirements in 49 CFR § 24.103(a)(2)(i) through (v) and address them as appropriate.

Section 24.103(a)(1). The appraisal report should identify the items considered in the appraisal to be real property, as well as those identified as personal property.

Section 24.103(a)(2). All relevant and reliable approaches to value are to be used. However, where an Agency agency determines that the sales comparison approach will be adequate by itself and yield credible appraisal results because of the type of property being appraised and the availability of sales data, it may limit the appraisal assignment to the sales comparison approach. This should be reflected in the scope of work.

Section 24.103(b) Influence of the project on just compensation. As used in this section, the term “project” means an undertaking which is planned, designed, and intended to operate as a unit.

When the public is aware of the proposed project, project area property values may be affected. Therefore, property owners should not be penalized because of a decrease in value caused by the proposed project nor reap a windfall at public expense because of increased value created by the proposed project.

Section 24.103(d)(1). The appraiser and review appraiser must each be qualified and competent to perform the appraisal and appraisal review assignments, respectively. Among other qualifications, State licensing or certification and professional society designations can help provide an indication of an appraiser's abilities.

Section 24.104 Review of appraisals. The term “review appraiser” is used rather than “reviewing appraiser,” to emphasize that “review appraiser” is a separate specialty and not just an appraiser who happens to be reviewing an appraisal. Federal Agencies agencies have long held the perspective that appraisal review is a unique skill that, while it certainly builds on appraisal skills, requires moreadditional skills. The review appraiser should possess both appraisal technical abilities and the ability to be the two-way bridge between the Agencycomprehend and communicate to the appraiser the agency's real property valuation needs, while recognizing and respecting the professional standards to which an appraiser is required to adhere.

Agency review appraisers typically perform a role greater than in land acquisition project management in addition to technical appraisal review. They are often involved in early project development by assisting the agency with project cost estimates for alternative project scenarios, identifying particularly complicated valuation problems that may need additional valuation specialties. In addition, they often provide the acquiring agency preliminary determinations about valuation problems, scope of work considerations, and types of appraisal reports necessary to complete a project. Later they may be involved in devising the scope of work statements and participate in making appraisal assignments to fee and/or staff appraisers. They are also mentors and technical advisors, especially on Agency agency policy and requirements, to appraisers, both staff and fee. AdditionallyIn addition, review appraisers are frequently technical advisors to other Agency agency officials.

Section 24.104(a). This paragraph Section 24.104(a) states that the review appraiser is to review the appraiser's presentation and analysis of market information and that it is to be reviewed against § 24.103 and other applicable requirements, including, to the extent appropriate, the Uniform Appraisal Standards for Federal Land Acquisition. The appraisal review is to be a technical review by an appropriately qualified review appraiser. The qualifications of the review appraiser and the level of explanation of the basis for the review appraiser's recommended (or approved) value depend on the complexity of the appraisal problem. If the initial appraisal submitted for review is not acceptable, the review appraiser is to communicate and work with the appraiser to the greatest extent possible to facilitate the appraiser's development performance of an acceptable appraisal.

In doing this, the review appraiser is to remain in an advisory role, not directing the appraisal, and retaining objectivity and options for the appraisal review itself.

If the Agency agency intends that the staff review appraiser approve the appraisal (as the basis for the establishment of the amount believed to be just compensation) , or establish the amount the Agency agency believes is just compensation, she/he must be specifically authorized by the Agency agency to do so. If the review appraiser is not specifically authorized to approve the appraisal (as the basis for the establishment of the amount believed to be just compensation), or establish the amount believed to be just compensation, that authority remains with another Agency agency official.

Section 24.104(b). In developing performing and reporting an independent approved or recommended value, the review appraiser may reference any acceptable resource, including acceptable parts of any appraisal, including an otherwise unacceptable appraisal. When a review appraiser develops performs their review assignment and reports an independent value different from the conclusions in the appraisal being reviewed, while retaining the appraisal review, that independent value also becomes the approved appraisal of the fair market value for Uniform Act Section 301section 4651(3) purposes. It is within Agency agency discretion to decide whether a second review is needed if the first review appraiser establishes a value different from that in the appraisal report or reports on the property.

Section 24.104(c). Before acceptance of an appraisal, the review appraiser must determine create a review report that documents the reviewer's determination that the appraiser's documentation, including valuation data and analysis of that data, demonstrates the soundness of the appraiser's opinion of value. For the purposes of this part, an acceptable appraisal is any appraisal that, on its own, meets the requirements of § 24.103. An approved appraisal is the one acceptable appraisal that is determined to best fulfill the requirement to be the basis for the amount believed to be just compensation. Recognizing that appraisal is not an exact science, there may be more than one acceptable appraisal of a property, but for the purposes of this part, there can be only one approved appraisal. See § 24.102(d).

At the Agencyagency's discretion, for a low value property requiring only a simple appraisal processsolution, the review appraiser's recommendation (or approval), endorsing the appraiser's report, may be determined to satisfy the requirement for the review appraiser's signed report and certification.

Section 24.106(

b

a). Expenses incidental to transfer of title to the agency. Generally, the

Agency

agency is able to pay such incidental costs directly and, where feasible, is required to do so. In order to prevent the property owner from making unnecessary out-of-pocket expenditures and to avoid duplication of expenses, the property owner should be informed early in the acquisition process of the

Agency

agency's intent to make such arrangements. Such expenses must be reasonable and necessary.

Subpart C—General Relocation Requirements

Section 24.202 Applicability and Section 24.205(c) Relocation Advisory Services to be provided. In extraordinary circumstances, when a displaced person is not readily accessible, the

Agency

agency must make a good faith effort to comply with

these sections and

§§ 24.202 and 24.205(c) and the Uniform Act and document its efforts in writing.

Section 24.204 Availability of comparable replacement dwelling before displacement.

Section 24.204(a) General. This provision Section 24.204(a) requires that no one may be required to move from a dwelling without a comparable replacement dwelling having been made available. In addition, § 24.204(a) requires that, “where where possible, three or more comparable replacement dwellings shall be made available. ” Thus, the basic standard for the number of referrals required under this section is three. Only in situations where three comparable replacement dwellings are not available (e.g., when the local housing market does not contain three comparable dwellings) may the Agency agency make fewer than three referrals.

Section 24.205 Relocation assistance advisory services.

Section 24.205(a). As part of the relocation planning process agencies should, to the extent practical, identify relocations that may require additional time for advisory services and coordination for their relocations. Such relocations may include the elderly, those with medical needs, and those in public housing or other federally subsidized housing. In each of these examples, the nature of the relocation means that the unique needs of the relocated person should be determined early and that the relocation agent should make full use of available social services and other program support (examples include local transportation services that may be available in certain areas, financial support available from local, Federal, and State agencies, and community support services that may be available) in considering and developing a relocation plan.

Section 24.205(c)(2)(ii)(C). Where feasible, comparable replacement housing must be inspected. The comparable replacement dwellings should be inspected by a walk through and physical interior and exterior inspection before being offered to a displaced person. Reliance on an exterior visual inspection or examination of a multiple listing service (MLS) listing, in most cases, does not constitute a complete DSS inspection. If an inspection is not possible, the displaced person must be informed in writing that an inspection was not possible and be provided an explanation of why the inspection was not possible. They also must be informed in writing that if the uninspected comparable is selected as a replacement dwelling a replacement housing payment may not be made until the replacement dwelling is inspected and determined to be decent, safe, and sanitary. Should the selected comparable later be found to not be DSS then the agency's policies and procedures must ensure that the requirements of § 24.2(a), definition of decent, safe and sanitary dwelling, are met. If the agency does not recalculate the eligibility in these instances, FHWA does not believe that the requirement to ensure comparable housing is made available to the displaced person can be met.

Each agency should clearly inform displaced persons that a DSS inspection as required by this part is only a brief inspection to ensure that certain requirements as they relate to the definition of DSS in this part are being met. These DSS inspections are not the same as a full home inspection similar to that which a home inspector would be hired to do.

Agencies may develop more restrictive DSS inspection requirements which may include required DSS inspections for selected comparable dwellings, all comparable dwellings used to establish a displaced persons replacement housing payment eligibility, or other more stringent DSS inspection requirements for comparable dwellings.

Section 24.205(c)(2)(ii)(D) This section emphasizes that if the comparable replacement dwellings are located in areas of minority concentration, minority persons should, if possible, also be given opportunities to relocate to replacement dwellings not located in such areas to improve their housing condition when they relocate.

The focus on those displaced from areas of minority concentration in this section has been consistently applied for almost 40 years. The FHWA believes that where practical and feasible, agencies carrying out relocations should provide those who live in areas of minority concentration opportunities to improve their living situations.

To the extent practical, agencies should maintain adequate written documentation of efforts made to locate such comparable replacement housing.

Section 24.206 Eviction for cause. An eviction necessitated by project related to non-compliance with a requirement related to carrying out a project (e.g., failure to move or relocate when instructed, or to cooperate in the relocation process) shall does not negate a person's entitlement to relocation payments and other assistance set forth in this part.

Section 24.207 General

Requirements-Claims

Requirements—Claims for relocation payments. Section 24.207(a) allows an

Agency

agency to make a payment for low cost or uncomplicated nonresidential moves without additional documentation, as long as the payment is limited to the amount of the lowest acceptable bid or estimate, as provided for in § 24.301(d)(1).

While § 24.207(f) prohibits an

Agency

agency from proposing or requesting that a

displaced

person waive his or her rights or entitlements to relocation assistance and payments, an

Agency

agency may accept a written statement from the

displaced

person that states that they have chosen not to accept some or all of the payments or assistance to which they are entitled. Any such written statement must clearly show that the individual knows what they are entitled to receive (a copy of the Notice of Eligibility which was provided may serve as documentation) and their statement must specifically identify which assistance or payments they have chosen not to accept. The statement must be signed and dated and may not be coerced by the

Agency.Subpart D—Payment

agency.

Section 24.208(c) Aliens not lawfully present in the United States—computing relocation payments if some members of a displaced family are present lawfully but others are present unlawfully.

If a person who is a member of a family being displaced is not eligible for and does not receive Uniform Act benefits because he or she is not lawfully in the United States, that person's income shall not be excluded from the computation of family income. The person's income is counted unless the agency is certain that the ineligible person will not continue to reside with the family. To exclude the ineligible person's income would result in a windfall by providing a higher relocation payment.

There are two different methods for computing relocation payments in situations where some members of a displaced family are present lawfully, but others are present unlawfully. For moving expenses, the payment is to be based on the proportion of lawfully present occupants to the total number of occupants. For example, if four out of five members of a family to be displaced are lawfully present, the proportion of lawful occupants is 80 percent and that percentage is to be applied against the moving expenses payment that otherwise would have been received. Similarly, unlawful occupants are not counted as a part of the family for RHP calculations. Thus, a family of five, one of whom is a person not lawfully present in the U.S., would be counted as a family of four. The comparable replacement dwelling for the family would reflect the makeup of the remaining four persons, and the RHP would be computed accordingly.

A “pro rata” approach to an RHP calculation is not permitted unless use of the two permitted methods discussed in this section would create an exceptional and extremely unusual hardship (consistent with Pub. L. 105-117; codified at 42 U.S.C. 4605). Following such a calculation would require that the agency disregard alien status for comparability determination, select a comparable and then apply a percentage to the RHP amount. A “pro rata” calculation approach for RHP may result in a higher RHP eligibility than the displaced persons would otherwise be eligible to receive. The “pro rata” approach of providing a percentage of the calculated RHP eligibility is contrary to the requirements of the Uniform Act and this part. A correct example of a calculation would be:

Household of seven (including one alien not lawfully present individually occupying one bedroom.)

Displacement dwelling—4 BR unit, with rent/utilities of $1,200/month

Housing requirements for all lawful occupants (six) is a 3 BR unit

Comparable dwelling

3 BR unit with rent/utilities of $1,300/month

Calculation of RHP under § 24.208(c) (alien not lawfully present excluded)

$1,300 (comparable)−$1,200 (displacement unit) = $100 RHP × 42 months = $4,200 RHP

Section 24.208(h) The meaning of the term “exceptional and extremely unusual hardship” focuses on significant and demonstrable impacts on health, safety, or family cohesion. This phrase is intended to allow judgment on the part of the agency and does not lend itself to an absolute standard applicable in all situations.

When considering whether a hardship exemption is appropriate, an agency may examine only the impact on an alien's spouse, parent, or child who is a citizen, or an alien lawfully admitted for permanent residence in the United States. In determining who is a spouse, agencies should use the definition of that term under State or other applicable law.

A standard of hardship involves more than the loss of relocation payments and/or assistance alone. Also, income alone (for example, measured as a percentage of income spent on housing) would not make the denial of benefits an “exceptional and extremely unusual hardship” and qualify for a hardship exemption. In keeping with the principle of allowing agencies maximum reasonable discretion, FHWA believes the decision regarding what documentation is required to support a claim of hardship is one best left to the Federal funding agency, as long as the decision is handled in a nondiscriminatory manner.

Subpart D—Payments for Moving and Related Expenses

Section 24.301 . Payment for Actual Reasonable Moving and Related Expenses.

Section 24.301(e) Personal property only. Examples of personal property only moves might be: personal property that is located on a portion of property that is being acquired, but the business, farm, nonprofit or residence will not be taken acquired and the business can still operate after the acquisition; personal property that is located in a mini-storage facility that will be acquired or relocated; or, personal property that is stored on vacant land that is to be acquired. For such a residential personal property move, there may be situations in which the costs of obtaining moving bids may exceed the cost to move. In those situations, the agency may allow an eligibility determination and payment based upon the use of the “additional room” category of the Fixed Residential Move Cost Schedule at www.fhwa.dot.gov/real_estate/uniform_act/relocation/moving_cost_schedule.cfm.

For a nonresidential personal property only move, the owner of the personal property has the options of moving the personal property by using a commercial mover or a self-move. If a question arises concerning the reasonableness of an actual cost move, the acquiring Agency agency may obtain estimates from qualified movers to use as the standard in determining the payment.

Section 24.301(g)(3) Modifications to personal property or to utilities. Construction costs for a new building at the business replacement site, costs to substantially reconstruct a building, or rehabilitate a building are generally ineligible for reimbursement as are expenses for disconnecting, dismantling, removing, reassembling, and reinstalling relocated personal property.

Section 24.301(g)(14) Relettering signs and replacing stationery. This may include changes to the content of other media that need correcting due to the displacement, such as DVDs and CDs. This may also include modifications to websites that would modify and edit contact and new location information made necessary because of the move. Agencies will need to determine when these costs are actual, reasonable, and necessary.

Section 24.301(g)(15)(i) This section only applies when equipment is not being moved to replacement site and

(ii). If

therefore it becomes an actual loss of tangible personal property. Under § 24.301(g)(15)(i), if the piece of equipment is operational at the acquired site, the estimated cost to reconnect the equipment shall be based on the cost to install the equipment as it currently exists

,

and shall not include the cost of code-required betterments or upgrades that may apply at the replacement site.

As prescribed in the

regulation

part, the allowable in-place value estimate (§ 24.301(g)(

14

15)(i)(B)) and moving cost estimate

(§ 24.301(g)(14)(ii))

must reflect only the “as is” condition and installation of the item at the displacement site. The in-place value estimate may not include costs that reflect code or other requirements that were not in effect at the displacement site

; or

.

The in-place value estimate may also not include installation costs for machinery or equipment that is not operable or not installed at the displacement site (§ 24.301(g)(15) (ii)). Value in place can be obtained by hiring a machinery and equipment (M&E) appraiser or value can be estimated via websites available for M&E valuations. An example of one resource is The Association of Machinery and Equipment Appraisers (AMEA) website.^[2] The AMEA is a nonprofit professional association whose mission is to accredit certified equipment appraisers. Another example of available resources can be found on the website of The American Society of Appraisers, a multi-discipline, nonprofit, international organization of professional appraisers. They maintain a separate web page for machinery and equipment appraisers.^[3] Should an agency find itself in need of a machinery and equipment appraisal, a web search for either “machinery and equipment appraisers” or “machinery and equipment appraiser's organizations” will provide a number of resources which can be used to find the necessary services and resources. It is important to note that FHWA does not endorse or recommend any organization, society, or professional group. The information provided in this appendix is strictly informational.

Section 24.301(g)(

17

18) Searching expenses. In special cases where the

displacing Agency

agency determines it to be reasonable and necessary, certain additional categories of searching costs may be considered for reimbursement. These include those costs involved in investigating potential replacement sites and the time of the business owner, based on salary or earnings, required to apply for licenses or permits, zoning changes, and attendance at zoning hearings. Necessary attorney's fees required to obtain such licenses or permits are also reimbursable.

Time spent in

Expenses negotiating the purchase of a replacement business site

is

are also reimbursable based on a reasonable salary or earnings rate. In those instances when such additional costs to investigate and acquire the site exceed

$2

$5,

500

000, the

displacing Agency

agency may consider requesting a waiver of the cost limitation under the § 24.7

,

waiver provision. Such a waiver should be subject to the approval of the Federal

-

funding

Agency

agency in accordance with existing delegation of authority. As an alternative to the preceding sentences in this section, Federal funding agencies may determine that it is appropriate to allow for payment of searching expenses of $1,000 with minimal or no documentation under this part. It is expected that each Federal funding agency will consider and address the potential for waste, fraud, or abuse and may develop additional requirements to implement this provision. Such requirements may include development of procedures or by requiring specific changes or inclusions in the written procedures approved by the Federal funding agency.

Search expenses may be incurred anytime the business anticipates it may be displaced, including prior to project authorization or the initiation of negotiations. However, such expenses cannot be reimbursed until the business has received the notice in § 24.203(b) and only after the agency has determined such costs to be actual, reasonable, and necessary as a result of the displacement.

Section 24.302 —The occupant of a seasonal residence could receive a payment based upon the Fixed Residential Move Cost Schedule or actual moving expenses in accordance with § 24.301. Persons owning or renting seasonal residences are generally not eligible for any relocation payments other than personal property moving expenses.

Section 24.303(a). Actual, reasonable, and necessary reimbursement for connection to available utilities are for the necessary improvements to utility services currently available at the replacement property. Examples include

(a) a Laundromat business that requires a larger service tap than the typical business service tap already on the property, and

(b)

Professional Services

a business that requires an upgrade or enhancement of the existing single phase electrical service to provide 3-phase electrical service.

Section 24.303(b) Professional services. If a question should arise as to what is a “reasonable hourly rate,” the

Agency

agency should compare the rates of other similar professional providers in that area.

Section 24.

305 Fixed Payment for Moving Expenses—Nonresidential Moves.Section 24.305(

303(c) Impact fees and one-time assessments for anticipated heavy utility usage.

Section 24.303(c) limits impact fees or one-time assessments to those levied for anticipated heavy utility usage to utilities, e.g., water, sewer, gas, and electric. Impact fees and one time assessments that may be levied on a nonresidential relocated person in their replacement location for other major infrastructure construction or use such as roads, fire stations, regional drainage improvements, and parks are not eligible. Providing information on the potential eligibility of impact fees for anticipated heavy utility usage is an important advisory service.

Section 24.304(b)(5) Ineligible expenses. The cost of constructing, reconstructing, or rehabilitating a replacement structure, is a capital expenditure, normally beyond the scope of § 24.304(a)(2) and is generally ineligible for reimbursement as a reestablishment expense. In those rare instances when a business cannot relocate without construction, reconstruction, or rehabilitation of a replacement structure, an agency or recipient may request a waiver of § 24.304(b)(5) under the provisions of § 24.7. An example of such an instance would be in a rural area where there are no suitable buildings available and the new construction, reconstruction, or rehabilitation of a replacement structure is the only option that will enable the business to remain a viable commercial operation. If a waiver is granted, the cost of new construction, reconstruction, or rehabilitation of a replacement structure will be considered an eligible reestablishment expense subject to the regulatory limit on such payment.

In markets where existing and new buildings are available for rental (and sometimes for purchase), the buildings or the various units available within the buildings often have only the basic amenities such as heat, light, and water, and sewer available. These buildings or units are referred to as shells. The cost of constructing, reconstructing, or rehabilitating a shell is not an eligible reestablishment expense because the shell is considered a capital real estate improvement (a capital asset). However, this determination does not preclude the consideration by an agency of certain modifications to an existing replacement business building as reestablishment costs if the agency applies a waiver under § 24.7.

A certain degree of construction costs are generally expected by the market because shells are designed to be customized by the tenant. An agency using a waiver may determine costs for these types of improvements or modifications are eligible for reimbursement, up to the amount of $33,200. Such costs may include the addition of necessary facilities such as bathrooms, room partitions, built-in display cases, and similar items, if required by Federal, State, or local codes, ordinances, or simply considered reasonable and necessary for the operation of the business. By contrast, a structure or shell which is dilapidated or is in disrepair and which requires construction, reconstruction, or rehabilitation would not be eligible for reimbursement under this part.

Section 24.305 Fixed payment for moving expenses—nonresidential moves.

Section 24.305(a) Business. If a business elects the fixed payment for moving expenses (in lieu of payment) option, the payment represents its full and final payment for all relocation expenses. Should the business elect to receive this payment, it would not be eligible for any other relocation assistance payments including actual moving or related expenses, or reestablishment expenses.

Section 24.305(c) Farm operation. If a farm operation elects the fixed payment for moving expenses (in lieu of payment) option, the payment represents its full and final payment for all relocation expenses. Should the farm elect to receive this payment, it would not be eligible for any other relocation assistance payments including actual moving or related expenses, and reestablishment expenses.

Section 24.305(d) Nonprofit organization. Gross revenues may include membership fees, class fees, cash donations, tithes, receipts from sales, or other forms of fund collection that enables the nonprofit organization to operate. Administrative expenses are those for administrative support such as rent, utilities, salaries, advertising, and other like items, as well as fundraising expenses. Operating expenses for carrying out the purposes of the nonprofit organization are not included in administrative expenses. The monetary receipts and expense amounts may be verified with certified financial statements or financial documents required by public Agencies.agencies.

If a nonprofit organization elects the fixed payment for moving expenses (in lieu of payment) option, the payment represents its full and final payment for all relocation expenses. Should the nonprofit organization elect to receive this payment, it would not be eligible for any other relocation assistance payments including actual moving or related expenses, or reestablishment expenses.

Section 24.305(e) Average annual net earnings of a business or farm operation. Section 24.305(a)(6) requires that the business contribute materially to the income of the displaced person during the 2 taxable years prior to displacement. This does not mean that the business needed to be in existence for a minimum of 2 years prior to displacement to be eligible for this payment.

If a business has been in operation for only a short period of time (i.e., 6 months) prior to displacement, the fixed payment would be based on the net earnings of the business at the displacement site for the actual period of operation projected to an annual rate. If a business was not in operation for a full 2 years, the existing net earnings income data should be used to project what the net earnings could be if the business were in operation for a full 2 years. If the business is seasonal, the business' operating season net income represents the full annual income for the purposes of calculating this benefit.

For Example:

(1) Business in operation for only 6 months earned $ 10,000.

Computation: ($10,000/6) × 12 = $20,000 annual net earnings × 2 years = $40,000 divided by 2 = $20,000; Eligibility = $20,000. (Average annual net earnings.)

(2) Business in operation 18 months earned $20,000.

Computation: $20,000 divided by 18 months = $1,111 per month × 24 months = $26,664 divided by 2 years = $13,332; Eligibility = $13,332 (Average annual net earnings)

(3) Business is seasonal—open summer only for 4 months and earns $5,000.

Computation: $5,000 was the seasonal net earnings 1 year and $6,000 was the seasonal net earnings a second year. $11,000 divided by 2 = $5,500; Eligibility = $5,500. (Average annual net earnings)

If the average annual net earnings of the displaced business, farm, or nonprofit organization are determined to be less than $1,000, even $0 or a negative amount, the minimum payment of $1,000 shall be provided (49 CFR 24.305(a)).

Section 24.306 Discretionary

Utility Relocation Payments

utility relocation payments. Section 24.306(c) describes the issues that the

Agency

agency and the utility facility owner must agree to in determining the amount of the relocation payment. To facilitate and aid in reaching such agreement, the practices in

the Federal Highway Administration regulation,

23 CFR part 645, subpart A,

Utility Relocations, Adjustments and Reimbursement,

should be followed.

Subpart E—Replacement Housing Payments

Section 24.401 Replacement Housing Payment housing payment for 18090-day Homeownerhomeowner-Occupantsoccupants.

Section 24.401(a)(2). An extension of eligibility may be granted if some event beyond the control of the displaced person such as acute or life threatening illness, bad weather preventing the completion of construction, or physical modifications required for reasonable accommodation of a replacement dwelling, or other like circumstances causes a delay in occupying a decent, safe, and sanitary replacement dwelling.

Section 24.401(c)(2)(iii) Price differential. The provision in § 24.401(c)(2)(iii) to use the current fair market value for residential use does not mean the Agency agency must have the property appraised. Any reasonable method for arriving at the fair market value may be used.

Section 24.401(d) Increased mortgage interest costs. The provision in § 24.401(d) sets forth the factors to be used in computing the payment that will be required to reduce a person's replacement mortgage (added to the downpaymentdown payment) to an amount which can be amortized at the same monthly payment for principal and interest over the same period of time as the remaining term on the displacement mortgages. This payment is commonly known as the “buydown.”

The Agency agency must know the remaining principal balance, the interest rate, and monthly principal and interest payments for the old mortgage as well as the interest rate, points, and term for the new mortgage to compute the increased mortgage interest costs. If the combination of interest and points for the new mortgage exceeds the current prevailing fixed interest rate and points for conventional mortgages and there is no justification for the excessive rate, then the current prevailing fixed interest rate and points shall be used in the computations. Justification may be the unavailability of the current prevailing rate due to the amount of the new mortgage, credit difficulties, or other similar reasons.

Sample Computation

Old Mortgage:
Remaining Principal Balance	$50,000
Monthly Payment (principal and interest)	$458.22
Interest rate (percent)	7
New Mortgage:
Interest rate (percent)	10
Points	3
Term (years)	15

Remaining term of the old mortgage is determined to be 174 months. Determining, or computing, the actual remaining term is more reliable than using the data supplied by the mortgagee. However, if it is shorter, use the term of the new mortgage and compute the needed monthly payment.

Amount to be financed to maintain monthly payments of $458.22 at 10% = $42,010.18.

Calculation:
Remaining Principal Balance	$50,000.00
Minus Annual Monthly Payment (principal and interest)	−42,010.18
Increased mortgage interest costs	7,989.82
3 points on $42,010.18	1,260.31
Total buydown necessary to maintain payments at $458.22/month	9,250.13

If the new mortgage actually obtained is less than the computed amount for a new mortgage ($42,010.18), the buydown shall be prorated accordingly. If the actual mortgage obtained in our example were $35,000, the buydown payment would be $7,706.57 ($35,000 divided by $42,010.18 = .8331; $9,250.13 multiplied by .83 = $7,706.57).

The Agency agency is obligated to inform the displaced person of the approximate amount of this payment and that the displaced person must obtain a mortgage of at least the same amount as the old mortgage and for at least the same term in order to receive the full amount of this payment. The Agency to advise the displaced person of the interest rate and points used to calculate the payment.

The FHWA has an online tool to calculate increased mortgage interest costs for fixed, and interest only loans at https://www.fhwa.dot.gov/real_estate/uniform_act/relocation/midpcalcs/.

Section 24.401(e) Reverse Mortgage. The provision in § 24.401(e) sets forth the factors to be considered to estimating an amount, after paying off the existing balance, sufficient to purchase a replacement reverse mortgage that provides a tenure or term payment, line of credit, or lump-sum disbursement. The agency must know the value of the acquired dwelling, existing balance of displacement reverse mortgage, remaining equity, and price of the selected comparable or actual replacement dwelling, to compute the estimated reverse mortgage supplement payment for a replacement reverse mortgage. In cases where there is a tenure or term payment additional information such as the age of the youngest borrower, amounts of the tenure payment, amount and remaining term of term payment and the current interest rate, is needed to calculate the payment and will require the assistance of a reverse mortgage broker.

Below are four scenarios for relocation payment eligibilities. As you will note, the eligibility is the same in each case; however, benefit amounts will vary depending on the individual's circumstance and existing reverse mortgage terms. This appendix also contains a list of other possible agency options, should a displaced person elect to use them; however, they are not recommended by FHWA because they do not place the person into a replacement reverse mortgage.

Situation 1—Owner has sufficient remaining equity to obtain a replacement reverse mortgage for purchase.

Situation 2—Owner's existing reverse mortgage has a tenure disbursement payment and there is not sufficient remaining equity to obtain a replacement reverse mortgage.

Situation 3—Owner's existing reverse mortgage has a term disbursement payment and there is not sufficient remaining equity to obtain a replacement reverse mortgage.

Situation 4—Owner's existing reverse mortgage is a line of credit and there is not sufficient remaining equity to obtain a replacement reverse mortgage.

The displaced homeowner may be eligible for the following relocation payments:

• A price differential payment in accordance with § 24.401(c).

The owner would be eligible for a price differential payment (the difference between the comparable replacement dwelling and the acquisition cost of the displacement dwelling).

• The administrative costs and incidental expenses necessary to establish the new reverse mortgage.

Incidental costs incurred with a replacement reverse mortgage are reimbursable and fall into three categories—Mortgage insurance premium (MIP), loan origination fee, and closing costs.

• A mortgage interest differential payment if the homeowner incurs a higher interest rate on the new reverse mortgage.

The payment would be based on the difference between the displacement adjustable-rate mortgage (ARM) cap rate at the initiation of negotiations and the available ARM cap rate and those rates would be used as the components to calculate the MIDP in accordance with the sample calculation provided at section 24.401(d) of this appendix. The agency must advise the displaced person of the interest rate

and points

used to calculate the payment. Note that most reverse mortgages are monthly adjustable rate mortgages, so any interest differential payment would be minimal.

• If the displaced homeowner elects to relocate into rental housing rather than remain a homeowner, then the agency will calculate relocation assistance payments in accordance with § 24.401(g).

For example, the agency computes a rental assistance payment of $10,000 for the owners based on a comparable replacement rental dwelling. When the owners settle with the agency, the owner will pay off the balance of the reverse mortgage and retain any remaining equity in the property. They are eligible for the rental assistance payment when they rent and occupy the DSS replacement dwelling.

Note:

In all situations, if the displaced homeowner elects to relocate into rental housing rather than remain homeowner, then the agency will calculate relocation assistance payments in accordance with § 24.401(g).

Note:

If the existing reverse mortgage was a lump-sum or line-of-credit which has been exhausted, then the agency is not under obligation to replace those amounts, but only to replace the reverse mortgage with a reverse mortgage with terms and equity similar to the displacement reverse mortgage.

Other agency options (not recommended unless elected by the displaced person, since they do not place the person into the same situation as the displacement reverse mortgage provided):

• A direct loan as set forth in § 24.404 under housing of last resort.

• A life estate interest in a comparable replacement dwelling under replacement housing of last resort.

• Agency purchases a comparable replacement dwelling and retains ownership and conveys a leasehold interest to the owner for his/her lifetime.

• Agency offers a comparable replacement rental dwelling to convert the homeowner-occupant to tenant status.

Section 24.402 Replacement Housing Payment for 90-day

Occupants

tenants and certain others.

Section 24.402(b)(2) Low income calculation example. The Uniform Act requires that an eligible displaced person who rents a replacement dwelling is entitled to a rental assistance payment calculated in accordance with § 24.402(b). One factor in this calculation is to determine if a displaced person is classified as having “low income,” as defined by the U.S. Department of Housing and Urban Development's annual survey of income limits for the Public Housing and Section 8 Programs. To make such a determination, the Agency agency must:

(1) Determine the total number of members in the household (including all adults and children);

(2) locate the appropriate table for income limits applicable to the Uniform Act for the state State in which the displaced residence is located (found at: httphttps://www.fhwa.dot.gov/realestate/ua/ualic.htmreal_estate/policy_guidance/low_income_calculations/index.cfm);

(3) from the list of local jurisdictions shown, identify the appropriate county, Metropolitan Statistical Area (MSA),* , or Primary Metropolitan Statistical Area (PMSA)* in which the displacement property is located; and

(4) locate the appropriate income limit in that jurisdiction for the size of this displaced person/family. The income limit must then be compared to the household income (defined at § 24.2(a)(15) ) which is the gross annual income received by the displaced family, excluding income from any dependent children and full-time students under the age of 18. If the household income for the eligible displaced person/family is less than or equal to the income limit, the family is considered “low income.” For example:

Tom and Mary Smith and their three children are being displaced. The information obtained from the family and verified by the Agency agency is as follows:

Tom Smith, employed, earns $21,000/yr.

Mary Smith, receives disability payments of $6,000/yr.

Tom Smith, Jr., 21, employed, earns $10,000/yr.

Mary Jane Smith, 17, student, has a paper route, earns $3,000/yr. (Income is not included because she is a dependent child and a full-time student under 18)

Sammie Smith, 10, full-time student, no income.

Total family income for

5

five persons is:

$21

$35,000 +

$6

12,000 +

$10

$18,000 =

$37

$65,000

The displacement residence is located in the State of Maryland, Caroline County. The low income limit for a 5 five person household is: $47$77,450950. (2004 2022 Income Limits)

This household is considered “low income.”

* A complete list of counties and towns included in the identified MSAs and PMSAs can be found under the bulleted item “Income Limit Area Definition” posted on the FHWA's Web site website at: httphttps://www.fhwa.dot.gov/realestate/ua/ualic.htm.real_estate/.

Section 24.402(c)

Downpayment

Down payment assistance. The

downpayment

down payment assistance provisions in § 24.402(c) limit such assistance to the amount of the computed rental assistance payment for a tenant

or an eligible homeowner

. It does, however, provide the latitude for

Agency

agency discretion in offering

downpayment

down payment assistance that exceeds the computed rental assistance payment, up to the

$5

$9,

250

570 statutory maximum. This does not mean, however, that such

Agency

agency discretion may be exercised in a selective or discriminatory fashion. The

displacing Agency

agency should develop a policy or requirement that affords equal treatment for displaced persons in like circumstances and this

policy

or requirement should be applied uniformly throughout the

Agency

agency's programs or projects.

For the purpose of this section, a displaced homeowner who elects to rent a replacement dwelling may not receive more than the eligibility the homeowner would have received as an eligible displaced homeowner purchasing a home.

Section 24.404(c)(3) requires the agency to provide assistance to a displaced owner or tenant occupant who fails to meet the 90-day requirement for length of occupancy of the displacement dwelling, prior to the initiation of negotiations, which is required for eligibility to receive a replacement housing payment under §§ 24.401 and 24.402.

Section 24.403(a)(1) Determining cost of comparable replacement dwelling. The requirement that if available at least 3 comparable dwellings should

the amount of the rental assistance payment exceed the purchase price of the replacement dwelling, the payment would be limited to the cost of the dwelling.Section 24.404 Replacement Housing of Last Resort

be considered when selecting a comparable dwelling when determining and calculating a replacement housing payment eligibility. Consideration, examination, or the viewing of an MLS listing does not equate to the inspection of the comparable dwelling required by § 24.205(c)(2)(ii)(C), which requires that at a minimum, the comparable dwelling should be physically inspected. When an inspection is not feasible, the displaced person must be informed in writing that a physical inspection of the interior or exterior was not performed, the reason that the inspection was not performed, and that if the comparable is selected as a replacement dwelling a replacement housing payment may not be made unless the replacement dwelling is subsequently inspected and determined to be decent, safe, and sanitary. Should the selected comparable dwelling later be found to not be DSS then the agency's policies and procedures must ensure that the requirements of § 24.2(a), definition of decent, safe and sanitary dwelling, are met. If the agency does not recalculate the eligibility in these instances, FHWA does not believe that the requirement to ensure comparable housing is made available to the displaced person can be met.

Some Federal funding agency requirements, such as those of the Department of Housing and Urban Development, prohibit reliance on an exterior visual inspection when selecting a comparable replacement dwelling or as part of determining the cost of comparable replacement dwellings. This is because the physical condition standards for such governmental housing assistance programs could not be met without an in-person physical inspection.

Section 24.403(a)(2) Carve Out of a Major Exterior Attribute. When determining the cost of a replacement dwelling, this section requires that the contributory value of a major exterior attribute, as determined in the real property valuation, be subtracted from the acquisition price of the displacement dwelling for purposes of computing the replacement housing payment if the comparable replacement dwelling lacks the major exterior attribute. The adjustment to the value of the displacement dwelling for the purpose of computing a replacement housing payment eligibility when a major exterior attribute is not available in the comparable replacement housing on the open market is often referred to as a “carve out.” Examples of such major exterior attributes may include land in excess of that typical in size for the neighborhood, a swimming pool, shed, or garage. Use of a carve out allows agencies to ensure comparable dwellings are available to the displaced person. The displaced person has received just compensation for the carved out attribute and may decide to use that compensation to replace the attribute. However, it should be noted that some carved out attributes, acreage as one example, cannot always be replaced in the immediate market and a displaced person may then have to decide whether they want to expand their search area and reconsider their desired replacement home location. The following are examples of the calculation process.

(Example A)

RHP Computation for Carve Out of a Major Exterior Attribute of a Displacement Property's Land in Excess of a Typical Lot:

Value of residential displacement real property on a larger lot than typical site for the neighborhood	$200,000
Minus the value of displacement property's land in excess of a typical site & not in comparable housing	15,000
Adjusted value of the displacement real property less carve out of the excess land	185,000
List Price of the Selected Comparable Housing	210,000
Minus the adjusted value of the displacement real property resulting from carve out of the excess land	185,000
Replacement Housing Payment Price Differential Payment Eligibility	25,000

(Example B)

RHP Computation for Carve Out of a Major Exterior Attribute of Displacement Property's Inground Swimming Pool:

Value of residential displacement real property with an inground swimming pool	$250,000
Minus the contributory value of displacement property's inground swimming pool not in the comparable	14,000
Adjusted value of the displacement real property less carve out of the inground swimming pool	236,000
List Price of the Selected Comparable Housing	245,000
Minus the adjusted value of the displacement real property less the inground swimming pool carve out	236,000
Replacement Housing Payment Price Differential Payment Eligibility	11,000

Section 24.403(a)(3) Additional rules governing replacement housing payments. The economic value to the owner of a remainder may be as an actual buildable lot for sale to an adjoining property owner, or for some other purpose for which the agency attributes an economic value to the owner. When allowed for under applicable law, a single offer that includes the value of the remainder property should be made. The purpose of making an offer to purchase the remainder is to allow for an RHP calculation and benefit determination that includes the value of the remainder as part of the compensation offered to the owner for acquisition, whether the property owner sells the remainder or choses to retain it. Should a property owner decide to retain a remainder then he would be responsible for the value of the remainder when he purchases his replacement property. Example B of this section shows the effect that a property owner's decision to retain a remainder or a State's inability to, or election not to, make an offer to purchase the remainder would have on the calculation of benefits.

The price differential portion of the replacement housing payment would be the difference between the comparable replacement dwelling and the agency's highest written acquisition offer. In the following examples, the before value of the typical residential dwelling and lot is $180,000; the remnant is valued at $15,000, and the part needed for the project (including the dwelling) is valued at $165,000, the comparable replacement dwelling is valued at $200,000. The price differential would be calculated as follows in the two scenarios:

(Example A) Agency Offers To Acquire Remainder

Comparable Replacement Dwelling		$200,000
Before value of parcel	180,000
Minus: Remainder Value	15,000
Acquisition of Part Needed	165,000
Agency's highest written offer		180,000
Price Differential Payment Eligibility		20,000

(Example B) Agency Does Not Offer To Acquire Remainder

Comparable Replacement Dwelling		$200,000
Before value of parcel	180,000
Minus: Remainder Value (owner retains)	15,000
Acquisition of Part Needed	165,000
Agency's highest written offer for part needed		165,000
Price Differential Payment Eligibility		35,000

Section 24.404 Replacement housing of last resort.

Section 24.404(b) Basic rights of persons to be displaced. This paragraph Section 24.404(b) affirms the right of a 18090-day homeowner-occupant, who is eligible for a replacement housing payment under § 24.401, to a reasonable opportunity to purchase a comparable replacement dwelling. However, it should be read in conjunction with the definition of “owner of a dwelling” at § 24.2(a)(20). The Agency agency is not required to provide persons owning only a fractional interest in the displacement dwelling a greater level of assistance to purchase a replacement dwelling than the Agency agency would be required to provide such persons if they owned fee simple title to the displacement dwelling. If such assistance is not sufficient to buy a replacement dwelling, the Agency agency may provide additional purchase assistance or rental assistance.

Section 24.404(c) Methods of providing comparable replacement housing. This Section 24.404(c) emphasizes the use of cost effective means of providing comparable replacement housing. The term “reasonable cost” is used to highlight the fact that while innovative means to provide housing are encouraged, they should be cost-effective. Section 24.404(c)(2) permits the use of last resort housing, in special cases, which may involve variations from the usual methods of obtaining comparability. However, such variation should never result in a lowering of housing standards, nor should it ever result in a lower quality of living style for the displaced person. The physical characteristics of the comparable replacement dwelling may be dissimilar to those of the displacement dwelling, but they may never be inferior.

One example might be the use of a new mobile home to replace a very substandard conventional dwelling in an area where comparable conventional dwellings are not available.

Another example could be the use of a superior, but smaller, decent, safe, and sanitary dwelling to replace a large, old substandard dwelling, only a portion of which is being used as living quarters by the occupants and no other large comparable dwellings are available in the area.

[70 FR 611, Jan. 4, 2005, as amended at 70 FR 22611, May 2, 2005]

Footnotes - Appendix A to Part 24

^[1]http://www.fhwa.dot.gov/realestate/.

^[2]http://www.amea.org/.

^[3]http://www.appraisers.org/Disciplines/Machinery-Technical-Specialties.