One of the fundamental rules when acquiring private property for public purposes,
according to the U.S. Constitution, is that the owner be paid Just Compensation.
The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, or The Uniform Act,
defines how public agencies must proceed when acquiring the right of way for a Federal-aid project.
The act addresses: the valuation of the property,
the presentation of the offer to acquire the property, and Relocation Assistance and Benefit.
Your agency must follow the rules of the Uniform Act to avoid delaying the project or losing Federal funding.
Let's see how an agency presents and negotiates a final offer
and documents its compliance with the Uniform Act and applicable State and local laws.
Agencies are encouraged to present their offer of Just Compensation promptly after the appraisal is completed,
and, whenever possible, in person.
The reason is to provide the owner all the information necessary to make an informed decision
and enough time to consider the offer.
The owner may accept your agency’s offer
or present a counter offer based on material he or she believes is relevant to the valuation of the property,
such as a comparable sale not included on the agency’s appraisal report.
If relevant, your agency must consider information presented by the owner.
After negotiations are complete, the owner transfers the property or property rights to your agency
through a deed or other form of conveyance instrument.
If all attempts to negotiate an agreement fail,
your agency might have to exercise the power of eminent domain.
Eminent domain gives the government the power to condemn and
take possession of private property needed for public purposes.
Condemnation procedures vary from State to State;
but normally before an agency can take possession of a property,
it deposits in an escrow account an amount not less than the appraised fair market value.
Whether through conveyance or condemnation,
the Federal Highway Administration considers the activity completed when your agency certifies that:
physical and legal possession of the properties has been acquired,
in accordance with the Uniform Act and other applicable laws,
the properties are free and clear of any structures, businesses, or people,
and any displaced persons have been relocated.
Now, let’s see how these steps work in practice.
Our example involves the widening of a one-mile stretch of a city street.
The project will affect several different properties,
one of which is a single-family home, owned and occupied by the Garcias.
The City of Lakeside has recently determined the purchase offer and relocation benefit.
The agency negotiator calls the Garcias
and schedules a time to present both the purchase and relocation offer in person.
During the meeting, they discuss how the agency arrived at the figures and review the appraiser’s report.
The Garcias have two teenagers in high school
and express their desire to purchase another house in the same school district.
The Garcias contact a real estate agent for information about the real estate market in their area.
From what they learn about properties that have sold recently, the Garcias accept the purchase offer.
At the real estate closing, the agency pays the closing costs.
The Garcias receive a purchase payment and transfer the title to the agency.
Acquisition is one of the most sensitive aspects of an agency’s activities
and your agency must conduct them in accordance with the Uniform Act and other Federal regulations.
As seen in our example, documenting your agency’s actions in a contact log
is an important way of showing compliance with the regulations.
A typical log includes: the purchase offer and the basis for the offer,
all phone calls and meetings with the landowner or other representatives,
any counter offers, and if applicable, reasons a settlement could not be reached.
Your State department of transportation, or State DOT,
provides guidance through its Right of Way Procedures Manual
and is responsible for the oversight of your agency’s program.
The staff in the State DOT right of way office can assist your agency with
following the right of way acquisition rules for Federal-aid projects.