[Federal Register Volume 89, Number 87 (Friday, May 3, 2024)]
[Rules and Regulations]
[Pages 36908-36980]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-08736]



[[Page 36907]]

Vol. 89

Friday,

No. 87

May 3, 2024

Part III





Department of Transportation





-----------------------------------------------------------------------





49 CFR Part 24





Uniform Relocation Assistance and Real Property Acquisition for Federal 
and Federally Assisted Programs; Final Rule

  Federal Register / Vol. 89, No. 87 / Friday, May 3, 2024 / Rules and 
Regulations  

[[Page 36908]]


-----------------------------------------------------------------------

DEPARTMENT OF TRANSPORTATION

Office of the Secretary

49 CFR Part 24

[Docket No. FHWA-2018-0039]
RIN 2125-AF79


Uniform Relocation Assistance and Real Property Acquisition for 
Federal and Federally Assisted Programs

AGENCY: Federal Highway Administration (FHWA), U.S. Department of 
Transportation (DOT).

ACTION: Final rule.

-----------------------------------------------------------------------

SUMMARY: This final rule amends the Uniform Relocation Assistance and 
Real Property Acquisition Policies Act of 1970 (Uniform Act) 
regulations. The revisions are prompted by enactment of the Moving 
Ahead for Progress in the 21st Century Act (MAP-21), which increased 
statutory relocation benefits and reduced length of occupancy 
requirements. This final rule updates existing regulations on the use 
of those provisions. The FHWA is also updating the Uniform Act 
regulations in response to comments received during this rulemaking's 
public comment period and to reflect the agency's experience with the 
Federal-aid highway program since the last comprehensive rulemaking for 
the part, which occurred in 2005. The updates include streamlining 
processes to better meet current Uniform Act implementation needs and 
eliminating duplicative and outdated regulatory language.

DATES: This final rule is effective June 3, 2024.

FOR FURTHER INFORMATION CONTACT: Arnold Feldman, Office of Real Estate 
Services, (202) 366-2028, email address: [email protected]; or 
Dawn Horan, Office of the Chief Counsel, (202) 366-9615, email address: 
[email protected]; Federal Highway Administration, 1200 New Jersey 
Avenue SE, Washington, DC 20590. Office hours are from 7:30 a.m. to 
5:00 p.m., E.T., Monday through Friday, except Federal holidays.

SUPPLEMENTARY INFORMATION:

Electronic Access and Filing

    This document, the 2019 Notice of Proposed Rulemaking (NPRM), and 
all comments received, may be viewed online at www.regulations.gov 
using the docket number listed above. Electronic retrieval help and 
guidelines are available on the website. It is available 24 hours each 
day, 365 days each year. An electronic copy of this document may also 
be downloaded from the Office of the Federal Register's website at: 
www.federalregister.gov and the Government Publishing Office's website 
at www.GovInfo.gov.

Executive Summary

    The Uniform Act, as amended, 42 United States Code (U.S.C.) 4601 et 
seq., provides important protections and assistance for people affected 
by Federal and federally assisted projects. Congress enacted this law 
to ensure that people whose real property is acquired, or who move as a 
result of Federal projects or projects receiving Federal funds, are 
treated fairly and equitably and receive just compensation for, and 
assistance in moving from, the property they own or occupy. The 
Government-wide regulation implementing the Uniform Act is 49 Code of 
Federal Regulations (CFR) part 24.
    The Surface Transportation and Uniform Relocation Assistance Act 
(STURAA) (Pub. L. 100-17) of 1987 designated DOT as the Federal Lead 
Agency (Lead Agency) for the Uniform Act. Duties of the Lead Agency 
include developing, issuing, and maintaining the Government-wide 
regulation, providing assistance to other Federal agencies, and 
reporting to Congress on Uniform Act implementation issues. The DOT has 
delegated these responsibilities to the FHWA at 49 CFR 1.85(d)(7).
    Acting as Lead Agency, FHWA is publishing this final rule to amend 
and update 49 CFR part 24, which affects the land acquisition and 
displacement activities of all Federal agencies subject to the Uniform 
Act, as well as the activities of the recipients of funding from those 
Federal agencies. The proposed changes to this regulation are 
necessitated in part by Section 1521 of MAP-21 (Pub. L. 112-141, July 
6, 2012). Section 1521 included increases in benefit levels for 
displaced persons, authority to develop a regulatory mechanism to 
consider and implement future adjustments to those benefit levels, the 
requirement for an annual report on Government-wide real property 
acquisitions subject to the Uniform Act, and provisions for the funding 
of Lead Agency services. In addition to these required changes, FHWA is 
amending the regulations to clarify existing requirements for 
implementing the Uniform Act, meet modern needs, and improve the 
agencies' service to individuals and businesses affected by Federal or 
federally assisted projects.
    The final rule's changes will also reduce the paperwork and 
administrative burdens of Federal Government regulations on agencies 
subject to the Uniform Act. The 10-year costs of the final rule for all 
Uniform Act agencies are estimated to be minor: $2.2 million when 
discounted at 7 percent and $2.4 million when discounted at 3 percent. 
The 10-year annualized costs are estimated to be: $311,000 per year 
when discounted at 7 percent and $283,000 per year when discounted at 3 
percent. Therefore, the costs associated with this rule are minimal.
    The larger impact of this rule is in the form of fund transfers 
from the displacing agencies to persons whose real property is acquired 
or whose personal property must be moved for Federal or federally 
assisted projects. The estimated amount of transfers resulting from 
this rule over a 10-year period are $169.5 million when discounted at 7 
percent and $214.6 million when discounted at 3 percent. This rule can 
therefore be thought of as predominantly a transfer rule, as the 
estimated social costs are significantly smaller than those transfers 
between displacing agencies and those compensated. The FHWA was the 
only agency that provided data upon which to base estimates of the 
transfers. Therefore, the magnitude of the change in transfers for all 
Federal agencies may be larger than is reported here. The Regulatory 
Impact Analysis (RIA) for this rulemaking contains further breakdown of 
costs associated with FHWA's program and can be found on the docket. 
Other Federal agencies may have additional regulatory or administrative 
updates specific to their programs as a result of this rulemaking.
    The benefits of this final rule primarily relate to improved equity 
and fairness to persons that are displaced from their properties or 
that move as a result of Federal projects or projects receiving Federal 
funds. For example, this final rule raises the maximum for payments to 
displaced persons to assist with the reestablishment of the business, 
farm, or nonprofit organization. There is strong evidence that 
displaced persons experience reestablishment costs well above the 
current maximum amount. Raising the maximum payment levels will 
compensate those displaced persons more fairly and equitably for the 
negative impacts they experience as a result of a Federal or federally 
assisted project. However, the fairness and equity benefits of the rule 
cannot be quantified or monetized. The higher level of payments may 
also contribute to more small businesses, farms, and nonprofit 
organizations being able to successfully reestablish after 
displacement.

[[Page 36909]]

Background

    FHWA last updated 49 CFR part 24 in 2005. Since publication of the 
2005 rule (70 FR 611), FHWA undertook a comprehensive effort to 
identify potential opportunities for improving implementation of the 
Uniform Act. FHWA initiatives included research on the need for 
regulatory and statutory change to the Uniform Act; co-sponsorship of 
national symposiums on Uniform Act implementation issues; 
implementation of pilot projects designed to determine the effect of 
changes in certain Uniform Act requirements and procedures; and an 
examination of the experiences of several State departments of 
transportation (State DOTs) in providing payments required by State law 
that supplemented Uniform Act benefits. These activities confirmed that 
there are a number of enhancements that could be made to clarify 
existing requirements, reduce administrative burdens, and improve the 
Government's service to individuals and businesses affected by Federal 
or federally assisted projects and programs.
    The Uniform Act and the common rule govern the relocation and real 
property acquisition programs of all Federal agencies. For convenience, 
those Federal agencies that provide a cross reference to this part and 
the location of those cross-references, are listed below:

U.S. Department of Agriculture
    7 CFR part 21
U.S. Department of Commerce
    15 CFR part 11
U.S. Department of Defense
    32 CFR part 259
U.S. Department of Education
    34 CFR part 15
U.S. Department of Energy
    10 CFR part 1039
U.S. Environmental Protection Agency
    40 CFR part 4
U.S. General Services Administration
    41 CFR part 105-51
U.S. Department of Health and Human Services
    45 CFR part 15
U.S. Department of Housing and Urban Development (HUD)
    24 CFR part 42
U.S. Department of Justice
    41 CFR part 128-18
U.S. Department of Labor
    29 CFR part 12
National Aeronautics and Space Administration
    14 CFR part 1208
Tennessee Valley Authority
    18 CFR part 1306
U.S. Department of Veterans Affairs
    38 CFR part 25
U.S. Department of Homeland Security
    44 CFR part 25

    The Uniform Act applies to all acquisitions of real property or 
displacements of persons resulting from Federal or federally assisted 
programs or projects; the Uniform Act's applicability is not affected 
by the absence of a cross reference to 49 CFR part 24 in an agency's 
regulations. Further, Federal or federally assisted activities 
involving land acquisition or displacement, undertaken by a newly 
constituted Federal agency, would be covered by the Uniform Act.
    FHWA began a process more than 15 years ago to identify additional 
needs for regulatory updates and elicit input from Federal stakeholders 
and conducted research projects, which resulted in many of the 
regulatory changes proposed in the NPRM and incorporated in this final 
rule. The primary focus of the various efforts was to identify 
opportunities to streamline processes to better meet current Uniform 
Act implementation needs and eliminate duplicative and outdated 
regulatory language in that rule. Beginning in 2012, and culminating in 
2018, FHWA held numerous working group meetings with representatives of 
the Federal agencies subject to the Uniform Act. The meetings included 
a section-by-section review of the regulation, consideration of 
comments received during the 2005 rulemaking process to identify 
potential areas of focus and change, review of listening session 
comments, and consideration of research findings. Contributions from 
working group members were based on their experiences implementing the 
rule and feedback they had received from their partners and customers. 
The review by the working group led to a compilation of potential 
changes to the rule. FHWA considered the group's recommendations and 
proposed changes for each of the regulation's subparts and developed an 
initial draft NPRM. Over a series of several working group meetings, 
the draft was refined and revised based on proposed edits and comments 
of the working group. When the working group meetings concluded, FHWA 
worked internally to finalize the draft NPRM and continued to share 
drafts and receive additional comments from the Federal agencies.
    On December 18, 2019, at 84 FR 69466, FHWA published an NPRM in the 
Federal Register. FHWA received 103 submissions to the docket resulting 
in more than 250 comments on various aspects of the proposed rule.

Summary of Significant Changes Made in the Final Rule

    This final rule was revised in response to comments received on the 
NPRM. The following paragraphs summarize the most significant of those 
changes. Editorial or minor changes in language are not addressed in 
this section. A detailed summary of the significant issues raised by 
the commenters and an explanation of the changes made in response to 
those comments can be found in the section-by-section analysis.

Subpart A--General

    Section 24.2 was revised by removing the proposed definition of 
``Federal down payment assistance'' and revising the definition of 
``Federal Financial Assistance.'' The discussion of Federal down 
payment assistance in the proposed appendix was also removed.
    Section 24.11 was revised to allow adjustments of waiver valuation 
limits, conflict of interest limits, and search cost reimbursements for 
nonresidential relocations. This section's title was revised to 
indicate these changes. This section was also revised by eliminating 
the fixed 5-year period for review and consideration of the need to 
update benefits.

Subpart B--Real Property Acquisition

    Throughout subpart B the word ``develop(ed)'' was replaced with the 
word ``perform(ed)'' when referring to waiver valuations, appraisals, 
or appraisal reviews to avoid confusion with long standing 
interpretations in the Uniform Standards of Professional Appraisal 
Practice (USPAP). The USPAP recognizes performing valuation assignments 
involves two separate functions: (1) development of a valuation, 
appraisal, or appraisal review, and (2) reporting the results of a 
valuation, appraisal, or appraisal review to clients, and intended 
users of valuation services. The intent of this change is to ensure 
that readers of this regulation understand that performance of a 
valuation, appraisal, or appraisal review includes both development of 
the assignment results and reporting those results to the client and 
intended users of the product. This change will provide clarity and 
consistency between this rule and certain USPAP requirements.
    In Sec.  24.101, FHWA removed (b)(2) and (3) and reorganized (b)(1) 
to clarify the requirements and qualifications for determining when a 
voluntary acquisition may be advanced for all Federal and federally 
assisted programs and projects desiring to use voluntary

[[Page 36910]]

acquisition. FHWA revised and streamlined Sec.  24.101(b)(1)(i), which 
clarifies that if eminent domain will not be used and if the additional 
requirements of this section are met, then an agency may use the 
voluntary acquisition requirements of this section. The FHWA also 
removed the Sec.  24.101(b)(2)(iii) discussion of the use of eminent 
domain.
    Section 24.102(c)(2)(ii)(C) was revised to increase the waiver 
valuation thresholds for property acquisitions with an estimated fair 
market value from $10,000 to $15,000 for the first tier, and $25,000 to 
$35,000 for the second tier, to address comments requesting additional 
waiver valuation flexibility.
    Section 24.102(c)(2)(ii)(D) was revised to eliminate some of the 
NPRM's proposed requirements for waiver valuations above $35,000 and up 
to $50,000 (third tier).
    Section 24.102(n)(3) was revised to increase the conflict of 
interest limits to $15,000 and $35,000 to allow additional flexibility 
and to align with the increase in waiver valuation limits changes in 
Sec.  24.102(c)(2)(ii)(C).

Subpart D--Payments for Moving and Related Expenses

    Section 24.301(g)(7) added a new provision for reimbursement of 
costs for rental replacement dwelling application fees and credit 
reports.

Section-by-Section Discussion

General Comments

    One commenter indicated that they believed that ``market value'' 
and ``fair market value'' were not the same.
    FHWA Response: FHWA believes that ``market value'' and ``fair 
market value'' refer to the same concept, i.e., the value of the 
property. FHWA acknowledges that some jurisdictions may ascribe 
different legal definitions to these terms, however the terms ``fair 
market value,'' which is used throughout this final rule, and ``market 
value,'' which may be more commonly used in private transactions, are 
synonymous for purposes of this rule.
    As a result, no changes were made to the final rule.

Section 24.2(a) Definitions

Appraisal
    One commenter suggested that FHWA adopt the definition of appraisal 
in the USPAP rather than the definition of an ``appraisal'' in the 
NPRM.
    FHWA Response: The definition of an ``appraisal'' can be found at 
42 U.S.C. 4601(13). This final rule continues to include that 
definition. FHWA received questions and concerns about the definition 
of an appraisal as it relates to most State licensure boards' view that 
any opinion of value issued by one of their licensees is by their 
definition of an appraisal (see discussion in this preamble, below, on 
the definition of ``waiver valuation.'') FHWA continues to believe the 
definition of appraisal in this regulation is consistent with the 
statutory description of an appraisal for Federal and federally 
assisted projects and programs.
    FHWA believes that adoption of USPAP definition of an appraisal 
would create administrative and fiscal burdens by effectively 
broadening the definition of appraisal in this regulation to include 
waiver valuations as appraisals. The programmatic consequence of 
redefining a waiver valuation as an appraisal would require those 
performing uncomplicated valuations for Federal and federally assisted 
projects or programs to comply with additional requirements for 
performing an appraisal, which would require additional time and 
increase costs to develop and report an opinion of value. FHWA does not 
believe that such increases in cost and time will afford any additional 
protections or benefits to those whose property is acquired for a 
Federal or federally assisted project or program. FHWA has more than 30 
years of experience with the use of waiver valuations under this 
regulation. FHWA previously conducted national waiver valuation 
surveys, research, and several informal program reviews and has not 
noted any significant instances of abuse or mishandling of program 
responsibility by any agency authorized to implement this flexibility 
in their program.
    As a result of the above analysis, no changes were made to this 
section of the final rule.
Comparable Replacement Housing--Unreasonable Adverse Environmental 
Conditions
    FHWA received one comment suggesting that it revise the definition 
of comparable replacement dwelling by removing the term 
``unreasonable.'' The commenter stated, in part, that ``unreasonable'' 
is undefined in the rule and therefore its use subjects this important 
protection to ambiguity, and consequently, uncertain or unpredictable 
implementation.
    FHWA Response: FHWA believes that removing the word 
``unreasonable'' from Sec.  24.2(a)(6)(iv) in the definition of a 
``comparable replacement dwelling'' is not necessary. The FHWA notes 
that this part of the definition of a ``comparable replacement 
dwelling'' has been in previous regulations for almost 40 years. In 
that time, FHWA has not noted any confusion about the definition or 
questions about correct application.
    As a result of this analysis no change was made to the definition.
Comparable Replacement Housing--Government Housing Assistance
    FHWA received one comment suggesting revising the definition of 
comparable housing for a displaced person receiving Government housing 
assistance before displacement. The commenter felt that changes to this 
section are needed to better reflect the reality of assisted units, 
unit availability, and the interests of assisted households who are 
displaced. The commenter felt the primary provisions of item (ix) in 
this definition (Sec.  24.2(a), Comparable Replacement Dwelling) were 
useful clarifications regarding application of housing assistance 
program rules to both previously assisted and previously unassisted 
households. However, the commenter felt that the proposed additions of 
paragraphs (ix)(A) through (C) (Sec.  24.2(a), Comparable Replacement 
Dwelling), are unnecessary and potentially harmful to displaced 
persons. The commenter believes that the proposed requirements of 
(ix)(A) through (C) may lead some displaced persons to view the 
potential absence of desired public housing units from these formal 
documented offers as confusing and may imply that utilizing public 
housing units as comparable dwellings are not an option. The commenter 
also was concerned that paragraphs (ix)(A) through (C) limits the units 
an agency may offer as a comparable unit, increasing costs and burdens 
of complying with the regulation. The commenter offered several 
suggestions for replacing paragraphs (ix)(A) through (C) to ensure that 
residents of subsidized dwellings are offered comparable replacement 
dwellings that are not limited to public housing. One proposal was to 
require that when a person is displaced from a privately owned dwelling 
which has unit-based assistance, at least one of the comparable 
replacement units offered may not be a public housing unit. The 
commentor also proposed that a displaced person who had tenant-based 
assistance must be provided at least one comparable privately owned 
unit where the displaced household's tenant-based assistance can be 
utilized.
    FHWA Response: FHWA reviewed the proposed changes in this section 
and the commenter's proposed deletions and additions. FHWA does not 
agree that the NPRM's proposed addition of paragraphs (ix)(A) through 
(C) in this

[[Page 36911]]

section limits or restricts choices or eligibility determinations that 
a displacing agency may make when a person is receiving Government 
housing assistance before displacement. FHWA believes that it is 
important to endeavor to provide the displaced person with options, 
which may include government assisted housing units, which are at 
minimum similar to their displacement dwelling. The inclusion of the 
renumbered paragraphs (9)(i) through (iii) in this final rule ensures 
that certain comparability standards are understood and met. FHWA does 
not agree with the commenter's proposed changes to this section to set 
a required number of government housing units, or market sale 
comparable dwellings, as such a standard will not ensure that a 
displaced person understands their replacement housing options. 
Effective advisory services are a required part of a relocation and 
include a discussion and identification of a displaced person's needs 
and preferences (Sec.  24.205(c)(2)(ii)). These requirements will both 
guide an agency in identifying appropriate comparable dwellings and 
ensure that the displaced person understands their options and 
eligibility.
    FHWA also does not view the language as drawing distinctions about 
the quality or desirability of certain types of Government housing 
assistance. FHWA believes the Federal funding agencies may want to 
develop additional policies or guidance to ensure that those displaced 
persons who are receiving Government housing assistance before 
displacement are provided comparable dwellings, which allows the agency 
to ensure that appropriate comparable housing has been made available.
    FHWA revised this section to clarify that Government housing and 
assistance programs' requirements and considerations include fair 
housing and civil rights compliance. The revisions require that a 
displacing agency determine that owners of the comparable properties 
will accept a government housing subsidy when determining and selecting 
a comparable dwelling. FHWA also included portions of the NPRM's 
appendix A discussion in this section to further clarify these 
requirements.
Decent, Safe, and Sanitary (DSS)
    Four commenters provided comments on the NPRM's proposed changes to 
the definition of ``DSS.'' One commenter expressed support for the 
changes to the definition and believed the changes will provide needed 
flexibility. Two commenters requested that all references to lead-based 
paint be moved to appendix A, with one stating that policies and 
practices to address lead-based paint should be considered to be a best 
practice. One commenter provided comments on the inclusion of a 
requirement to comply with local standards requiring the abatement of 
deteriorating paint, including lead-based paint and lead-based paint 
dust, where they exist. This commenter was supportive of the 
requirement but believes that the final rule should be revised to 
require additional specific testing because few State and local 
jurisdictions have housing or public health codes requiring pre-
occupancy lead hazard inspections. This commenter also proposed an 
alternative requirement be added to the final rule which would require 
a proactive inspection for lead-paint hazards in any replacement 
housing units to be made available to displaced persons, with 
remediation and cleaning as necessary. This commenter also proposed an 
addition to this definition to clarify that comparable and replacement 
dwellings should be free of other health hazards, including mold, 
infestations, and radon, and that comparable dwellings have operable 
fire and carbon dioxide alarms.
    FHWA Response: FHWA appreciates the support for the proposed 
changes to this definition. FHWA also appreciates the comments and 
rationale that every measure should be taken to ensure that a displaced 
person is able to move to a dwelling where all known health risks have 
been identified and addressed. However, as was discussed in the NPRM's 
preamble, this rule and its definition of ``DSS'' are minimum 
requirements. Further, the NPRM also proposed to add that in cases 
where either local code or agency policy or regulation were more 
stringent, then the most stringent of those requirements must be 
applied. FHWA believes that the requirement to follow the most 
stringent policy or regulation ensures that agencies will take the 
required steps to ensure that a dwelling is DSS. FHWA does agree that 
if lead-based paint is specifically listed in this part of the 
regulation, other likely requirements, for example those related to 
asbestos or radon, should also be listed. Therefore, FHWA does not 
believe that adding additional specific requirements to this definition 
is practical. FHWA may develop one or more frequently asked questions 
(FAQ) listing examples where local code or agency requirements may be 
more restrictive. Where required, Federal funding agencies can develop 
the additional policies and requirements necessary to identify and 
address potential deficiencies in comparable and replacement dwellings 
that may impact a displaced person's health.
    As a result of the above analysis, the term ``the most stringent of 
the local housing code, Federal agency regulations, or the agency's 
regulations or written policy'' was used throughout this section for 
clarity and consistency. No other changes were made to this section of 
the final rule.
DSS--Appendix A at Section 24.2(a)--Standards for Inclusion of a 
Kitchen
    The FHWA received one comment expressing some concerns about the 
proposed addition in appendix A at Sec.  24.2(a), DSS, addressing 
kitchens in comparable and replacement properties. The commenter 
believes that the proposed appendix A discussion that recommends and 
encourages agencies to select comparable replacement dwellings with a 
kitchen, when the displacement dwelling does not have one, and local 
codes do not require it, seems excessive. The commenter believes the 
recommendation and encouragement will needlessly increase the cost of a 
replacement dwelling and add unnecessary complexity and inconsistency 
in the program.
    FHWA Response: FHWA considered the comment and reviewed the NRPM's 
description of the proposed addition in the appendix A language. FHWA 
notes that the NPRM's proposed addition in appendix A addresses 
instances where local code standards for occupancy do not require 
kitchens. Appendix A notes that even though it is not required by local 
code, providing a kitchen is recommended. FHWA believes the appendix A 
discussion is consistent with and supports the Uniform Act's expression 
of Congressional intent found at 42 U.S.C. 4621(c)(3), Declaration of 
findings and policy, which states that the improvement of housing 
conditions of economically disadvantaged persons under this subchapter 
shall be undertaken, to the maximum extent feasible, in coordination 
with existing Federal, State, and local governmental programs for 
accomplishing such goals. The NPRM's proposed addition, which will be 
included in this final rule, contains no mandatory language, but does 
express a goal that where practical and possible, displacing agencies 
should endeavor to meet. FHWA will consider whether an FAQ may be 
necessary to further clarify the intent and purpose of this appendix A 
item.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

[[Page 36912]]

Displaced Person (Persons Not Displaced)--Occupants of a Temporary, 
Daily or Emergency Shelter and Appendix A of This Part
    Three commenters provided comments on the NPRM's proposal to 
address occupants of shelters. One commenter was concerned that the 
addition of an item in the definition of persons not displaced 
addressing shelter occupants might cause shelter operators to change 
their method of operation to a ``lottery based'' system to more clearly 
align with this rule's definition of persons not displaced. This 
commenter was further concerned that this potential change in agreement 
or operation methods would ensure that shelter occupants would not be 
defined as displaced persons and would thereby cause impacts to shelter 
occupants, both inside a project or program area and outside. The 
commenter believes that shelters currently have many regulatory and 
statutory methods of providing accommodation to shelter occupants which 
provides those occupants with necessary temporary housing resources. 
The commenter suggests adding additional language to the proposed 
addition of persons not displaced to include the many types of 
agreements shelter operators use to provide temporary shelter. One 
commenter believed that temporary shelter is not defined in the NPRM. 
One commenter indicated that anyone who has a place to stay and store 
their belongings for more than a single night should be provided some 
relocation benefits and at a minimum, be provided another shelter to 
use. One commenter stated that if someone is in occupancy for only one 
night, at a minimum, connecting them with similar services elsewhere 
should be required.
    FHWA Response: FHWA reviewed the NPRM's proposed additions to 
address occupants of a shelter that is acquired for a Federal or 
federally assisted project or program. FHWA does not agree that the 
NPRM's proposed additions addressing occupants of a shelter will cause 
shelters to revise their operating methods or agreements because if it 
is determined that a shelter's occupants meet the definition of 
``displaced persons,'' any additional administrative burden or 
relocation costs will be borne by the acquiring agency rather than the 
shelter's operators. Additionally, the final rule provides another 
potential resource, the replacement housing payment, that may be used 
to provide shelter or housing to those in need.
    The FHWA notes that the NPRM's proposed language describes 
circumstances in which shelter occupants may be required to move or 
more commonly, no longer have access to or use of the shelter because 
of its acquisition for a Federal or federally assisted project or 
program. The NPRM language also stressed that the proposed language and 
discussion was simply a clarification. It did not create or require 
that new eligibilities be granted or conferred. Instead, it provided 
additional factors to be considered when determining if an occupant of 
a temporary, daily, or emergency shelter impacted by a Federal or 
federally assisted project or program, who in most instances would not 
meet the definition of a displaced person, may be displaced due to a 
fact-based determination.
    FHWA believes those acquiring a shelter and making a determination 
of whether a person is displaced should consider factors including, but 
not limited to, whether the shelter has specific rules and requirements 
as to who can occupy or use the shelter and whether prolonged and 
continuous occupancy is allowed. Shelters should not be advised or 
directed to change their operating agreements in order to conform to 
this rule's definition of persons not displaced.
    FHWA also considered the commenter's concerns about requiring 
agencies acquiring a shelter to either ensure a replacement shelter is 
available to those required to move or to provide information on 
available shelters. FHWA notes that the final rule will include the 
NPRM's proposed requirement in the definition of ``Persons Not 
Displaced; L) Occupants of an Emergency Shelter'' to provide, at a 
minimum, all occupants of an acquired shelter with advisory assistance 
beginning at the initiation of negotiations.
    FHWA notes that certain HUD programs use the term ``emergency 
shelter'' based on the McKinney-Vento Homeless Assistance Act (42 
U.S.C. 11301 et seq.). HUD defines ``emergency shelter'' in 24 CFR 91.5 
as ``[a]ny facility, the primary purpose of which is to provide a 
temporary shelter for the homeless in general or for specific 
populations of the homeless, and which does not require occupants to 
sign leases or occupancy agreements.''
    Relatedly, the NPRM proposed defining ``Temporary, daily, or 
emergency shelter.'' The proposed definition stated in part that a 
shelter typically requires the occupants to remove their personal 
property and themselves from the premises on a daily basis, offers no 
guarantee of reentry in the evening, and does not meet the definition 
of dwelling as used in this part. The final rule includes a revised 
definition that includes replacing the term ``typically'' with ``in 
most cases.'' FHWA believes that the proposed change more accurately 
reflects the unusual situations in which a person living in a shelter 
would be a displaced person as defined in this regulation.
    FHWA may consider developing one or more FAQ to further provide 
guidance on how to determine when certain occupants of a temporary, 
daily, or emergency shelter are displaced persons and instances when 
they would not be displaced persons.
Dwellings
    Eleven commenters expressed support for a modification to the 
definition of ``dwelling.'' The NPRM proposed a minor modification to 
this definition by removing the term ``non-housekeeping unit'' and also 
included language in the preamble which discussed and clarified that a 
DSS dwelling may be unconventional or non-standard. There were no 
comments on the proposed removal of the term ``non-housekeeping unit.'' 
The discussion of determining whether persons occupying a non-standard 
dwelling may qualify as a displaced person was the focus of most of the 
comments received on this proposed change. The primary focus of the 
comments was in refining the definition of dwelling. One commenter 
suggested including the word ``unconventional'' instead of inclusion of 
``other residential units'' such as motels. Six commenters supported 
the addition of ``primary'' and ``customary place of abode'' in the 
definition of dwelling. Four commenters questioned the inclusion and 
meaning of ``local custom or law.''
    One commenter asked for some guidance for dealing with individuals 
who are not occupying a legal dwelling, but who are living on their 
property in a temporary structure that does not meet the definition of 
a legal dwelling per local code. They stated that while it seems clear 
that the intent of the Uniform Act was not to treat these individuals 
as an owner-occupant eligible for a replacement housing payment, the 
Uniform Act and the regulations also do not provide any viable 
alternative.
    The primary concern was that the definition would lead to lawful 
occupants of a non-DSS or non-standard displacement dwelling being 
determined to be a person not displaced under this regulation, 
resulting in a denial of Uniform Act relocation eligibility. One 
commenter requested temporary, transitional, or court-ordered housing 
be included in the definition.

[[Page 36913]]

    FHWA Response: FHWA reviewed the regulatory history of these 
regulations and notes that the definition in this final rule, with the 
minor modifications proposed in the NPRM, is largely the same 
definition that has been in the regulations for almost 40 years. The 
primary purpose of the NPRM's proposed changes was to ensure that there 
is a clear understanding that great care must be taken in determining 
whether and when an occupant is a displaced person as defined under the 
regulation. A number of questions were raised about the meaning of the 
phrase ``. . . place of permanent or customary and usual residence 
according to local custom or law.'' FHWA believes that throughout the 
history of these regulations, agencies have understood the plain 
language of this phrase to be focused on the facts considered when 
determining if the dwelling was the occupant's permanent or customary 
and usual residence (also referred to as ``dwelling''). Local custom or 
law would therefore be determinative in making a fact-based 
determination as to whether the occupant was occupying a seasonal home, 
or a residence other than their place of permanent or customary and 
usual residence. The use of local law or custom can also be used to 
determine that a person is in a residential landlord-tenant 
relationship and therefore occupying a dwelling for purposes of 
determining eligibility under the Uniform Act. FHWA may develop one or 
more FAQs with fact-based information that can be used in making a 
determination as to whether a dwelling is an occupant's permanent or 
customary and usual residence.
    Several commenters raised concerns that the proposed revisions to 
this definition could be interpreted in a manner which might deny 
eligibility for persons living in a non-standard and or non-DSS 
dwelling. FHWA notes that a non-standard or non-DSS unit can still meet 
the definition of ``dwelling'' when determining eligibility. For 
example, if an occupant resides in a non-standard dwelling, key 
information will include whether State or local law or code allows the 
person to lawfully occupy the otherwise DSS non-standard dwelling. For 
a dwelling for which State or local law or code allows occupancy but is 
non-DSS, an occupant might be determined to be in lawful occupancy and 
would then be a displaced person. If the occupancy of the dwelling were 
not permitted by State or local law or code in the same example or the 
occupants were not in lawful occupancy, they would not be displaced 
persons. For occupants found not to be in lawful occupancy, the final 
rule continues to allow that such persons may be provided advisory 
services which may assist them by identifying available replacement 
dwellings, local and State services, and other assistance which may be 
available to them. While these persons may not be displaced persons, 
agencies should provide such advisory services to the extent practical.
    As a result of the above analysis, no changes were made to this 
section of the final rule.
Federal Down Payment Assistance
    FHWA received four comments supportive of the NPRM's proposed 
addition of a definition of ``Federal down payment assistance.'' One 
commenter asked that the NPRM's proposed appendix A addition be revised 
in the final rule to include a further discussion and examples of what 
constitutes ``funds'' other than the funds subject to the Uniform Act 
requirement. Two commenters asked that the appendix A discussion of 
Federal down payment assistance be revised by separating the discussion 
of ``Federal down payment assistance'' and ``Federal financial 
assistance.'' The commenters reasoned that the combination of the two 
topics might lead to confusion in determining Uniform Act 
applicability. One commenter asked that FHWA clarify that the use of 
Uniform Act benefits does not create a displacing activity and 
eligibility for Uniform Act benefits.
    FHWA Response: FHWA considered the comments and requests for 
clarification about the NPRM's proposed addition of a definition of 
Federal down payment assistance. FHWA believes that the comments, while 
generally supportive, also indicate uncertainty about the proposed 
concept. The uncertainty includes whether there is an established 
funding threshold to be used in determining if a purchase of property 
funded in some portion by Federal down payment assistance, would create 
a displacing activity. After further considering whether additional 
clarifications or changes in this final rule could address those 
questions, FHWA determined that the implementation of this proposed 
change may continue to raise questions and uncertainty, which will lead 
to an uneven understanding and application that may result in benefits 
and protections being provided to some but not all whose dwellings are 
acquired by those using Federal down payment assistance.
    As a result of the above analysis, FHWA declines to adopt the 
proposed changes relating to ``Federal down payment assistance'' in the 
final rule.
Federal Financial Assistance (FFA)
    One commenter requested that the definition of ``FFA'' be modified 
to include the concept of rental subsidies.
    FHWA Response: The definition of FFA in part assists in determining 
whether the requirements of the Uniform Act apply. FHWA does not 
believe that revising the definition by adding a term, phrase, or 
benefit that is specific to one or more Federal agency's program is 
practical. The FHWA believes that Federal agencies should implement 
policies and procedures for program grants, loans, and contributions 
that are necessary to implement their program.
    As a result of this analysis, the final rule will not include a 
definition of ``Federal down payment assistance'' as explained in the 
preceding preamble discussion on Section 24.2(a), Definitions and 
Acronyms, Federal Down Payment Assistance.
Federal Financial Assistance--Low Income Housing Tax Credits (LIHTC)
    Two commenters provided comments on the NPRM's proposal to clarify 
that LIHTC are not FFA for purposes of determining eligibility for 
Uniform Act benefits and assistance. One commenter supported the 
proposed clarification that LIHTC are not FFA as defined in the Uniform 
Act and therefore, projects receiving LIHTC alone would not be subject 
to the Uniform Act. This commenter further stated that it is their 
understanding that LIHTC projects that do receive a federally assisted 
grant, loan, or other Federal contribution would still be subject to 
the Uniform Act. The other commenter did not support the proposed 
clarification. This commenter stated in part that the LIHTC program 
provides approximately $10 billion in direct, concrete financial 
assistance to housing developers for the acquisition, rehabilitation, 
and development of LIHTC projects around the Nation. This commenter 
also stated the LIHTC program serves a key public purpose--generating 
affordable housing development by federally subsidizing, or assisting, 
such development. This commenter additionally stated that the LIHTC 
program also plays an enormous role in financing the acquisition and 
rehabilitation of existing affordable housing units, noting that nearly 
1 out of every 3 housing units funded by the LIHTC program in the 
United States involved the acquisition or rehabilitation of existing 
dwellings, some 950,000 units in all.

[[Page 36914]]

    FHWA Response: FHWA noted in the NPRM that the LIHTC is described 
by the Office of the Comptroller of the Currency as a program 
``established as part of the Tax Reform Act of 1986 and is commonly 
referred to as section 42, the applicable section of the Internal 
Revenue Code. The LIHTC program provides tax incentives to encourage 
individual and corporate investors to invest in the development, 
acquisition, and rehabilitation of affordable rental housing. The LIHTC 
is an indirect Federal subsidy that finances low-income housing. This 
allows investors to claim tax credits on their Federal income tax 
returns. The tax credit is calculated as a percentage of costs incurred 
in developing the affordable housing property and is claimed annually 
over a 10-year period. Some investors may garner additional tax 
benefits by making LIHTC investments.''
    FHWA does not believe that LIHTC is FFA as it is defined in Sec.  
24.2(a) because of the nature of these tax credits and the fact that 
they are not a grant, loan, or contribution provided by the United 
States, and therefore not subject to Uniform Act requirements. Given 
that they are described as an ``indirect Federal subsidy'' and as a 
``tax incentive'' by the Office of the Comptroller of the Currency, it 
follows that investors and developers would make self-directed 
determinations on where and how they should pursue development 
opportunities that maximize financial benefits for themselves. In 
considering the commenter's concern about the nature of the LIHTC 
program, FHWA does not believe that use of LIHTC alone would require 
the developer to comply with the requirements in this regulation. 
However, if other Federal funds are used on the same projects to 
incentivize the developer's participation, then the use of that Federal 
financial assistance may need to be subjected to a fact based 
determination of Uniform Act applicability. While the Uniform Act does 
not require relocation assistance when only LIHTC is used in a project, 
Federal funding agencies nonetheless may develop policy or requirements 
which authorizes relocation assistance to those displaced by a project 
or program which uses or receives LIHTC's, to the extent they are 
legally empowered to do so. FHWA does not believe that Federal funding 
agencies making such a determination to provide additional benefits or 
assistance would result in a reduction of required benefits and 
assistance available to others. FHWA may develop one or more FAQs to 
provide further assistance in determining when and if Uniform Act 
requirements would be applicable for individuals who claimed or will 
claim LIHTC credits for development, acquisition, and rehabilitation of 
affordable rental housing.
    As a result of the above analysis, no changes were made to this 
section of the final rule.
Initiation of Negotiations--Voluntary Acquisition
    The FHWA received seven comments on the proposed revision to the 
definition of ``Initiation of Negotiations'' related to voluntary 
acquisitions. One commenter supported waiting until there is a binding 
legal agreement before tenant relocation eligibility begins on 
voluntary acquisitions. The commenter reasoned that because purchase 
options/agreements can fail to result in a sale of the property for 
various reasons, it would not make sense for persons to be fully 
eligible for relocation assistance until closing. The commenter then 
posed the following question: ``Where is the relocation funding 
expected to come from for an agency that executes a purchase agreement 
(which triggers `full eligibility' for a tenant who moves for the 
project) but has the project fall through before Federal funds are ever 
used?'' One commenter did not support the change to the tenant 
relocation eligibility because changing this eligibility would slow the 
relocation process and is too big of a deviation from the current rule. 
Two commenters requested clarification of the term ``Initiation of 
Negotiations,'' and one commenter believes the term is a misnomer since 
the Initiation of Negotiations does not start until the contract is 
executed (rather than the purchase option). Another commenter agreed 
that a purchase option or conditional contract has contingencies that 
must be satisfied before the buyer executes their right to purchase 
real property, but also commented that a written purchase agreement, as 
used in their acquisition activities, typically is a written contract 
that does bind the buyer and seller to the terms of the agreement. The 
commenter therefore requested that the reference to a purchase 
agreement be removed from this sentence or further clarification be 
provided as to what FHWA considers to be a binding agreement to 
purchase real property in lieu of a written purchase agreement. Two 
commenters raised questions, specific to the HUD program, about 
determining or establishing eligibility for a tenant who moves prior to 
a negotiation resulting in a binding agreement between the agency and 
the property owner.
    FHWA Response: An agency pursuing a voluntary acquisition may use a 
conditional sale agreement or option to purchase agreement. Those 
agreements do not impose an obligation on the agency to purchase the 
property until either the agreement's conditions are met, or the agency 
elects to exercise its right to purchase. The previous rule's 
requirements were sometimes misunderstood as requiring an agency to 
provide relocation assistance for tenants occupying real property even 
when the agency ultimately could not acquire through a voluntary 
agreement. This final rule will clarify the date of relocation 
assistance eligibility for tenants who occupy real property that is 
acquired by voluntary acquisition. Such eligibility is established when 
there is a binding written agreement between the agency and the 
property owner that obligates the agency, without further election, to 
purchase the real property. These revisions in the final rule will 
allow an agency to more efficiently carry out voluntary acquisitions 
and ensure they will not incur costs for relocation assistance unless 
and until there is a binding legal agreement for the sale between the 
agency and the property owner.
    FHWA notes that for acquisitions carried out under the authority of 
eminent domain, the meaning of the term ``Initiation of Negotiations'' 
and the date when negotiations begin was not proposed to be and has not 
been changed in this final rule.
    FHWA included a clarification in the final rule that the term 
``binding written agreement'' in the context of paragraph (iv) of the 
definition of initiation of negotiations requires several conditions to 
be true. To be a binding written agreement within the meaning of 
paragraph (iv), the agreement must be a legally enforceable commitment 
no longer subject to elections or conditions, in which the property 
owner agrees to sell certain property rights necessary for a project 
and the agency agrees to make that purchase for a specified 
consideration. In other words, any elections and conditions have been 
satisfied, so that the agency is obligated to purchase the real 
property. Both parties have formally accepted the terms contained in 
the agreement, documented their agreement in writing, and acknowledged 
their acceptance with their signatures. FHWA will include the language 
proposed in the NPRM which stated in part that ``An option to purchase, 
conditional sale, or purchase agreement is not considered a binding 
agreement to purchase real

[[Page 36915]]

property''. However, FHWA believes that each Federal funding agency 
will need to develop policies or requirements identifying the types of 
agreements used in its programs or projects which it considers to be 
binding and which would therefore trigger eligibility for tenants as 
displaced persons.
    FHWA does not believe that clarifying the eligibility-triggering 
criteria for voluntary acquisition reduces benefits or assistance to 
tenants because it is not substantively different than the standard in 
the regulation adopted in 2005, 49 CFR 24.2(15)(iv). In addition, 
application of this provision's protection for displaced persons is 
supported by the requirements for a clearly written notification to the 
tenant of the process being followed, an explanation of the trigger 
date of their eligibility, and when negotiations fail, a required 
written notification that negotiations failed and assurance that the 
tenant will not be required to move from the property. (See Sec.  
24.2(a) Initiation of Negotiations and Appendix A, Sec.  24.2(a) 
Initiation of Negotiations, Tenants (iv)). FHWA may develop one or more 
FAQs to ensure clarity about tenant eligibility for relocation 
assistance when a property is purchased voluntarily.
Initiation of Negotiations--Voluntary Acquisition, Other Federal Agency 
Programs
    One commenter requested a clearer definition of the term 
``Initiation of Negotiations'' for Section 8 contracts. The commenter 
was unclear about the relationship between the date that is the 
Initiation of Negotiations and the NPRM's new concept of a notice of 
intent to acquire/rehab/demolish.
    One commenter had a question that appears to be related to a HUD 
program. The commenter asked about the overlap in the terms for 
Initiation of Negotiations when the acquisition is privately 
undertaken, which the commenter believes places Initiation of 
Negotiations under both subparagraphs, Sec.  24.2(a) Definitions and 
Acronyms. Initiation of Negotiations, (i) and (iv). The commenter 
requests that FHWA clarify if a displaced tenant is eligible upon 
execution of a binding written agreement to purchase the property, 
Sec.  24.2(a) Definitions and Acronyms. Initiation of Negotiations, 
(iv), or whenever the tenant receives a notice they will be displaced 
(or the date they actually move, if there is no notice), Sec.  24.2(a) 
Definitions and Acronyms. Initiation of Negotiations, (ii).
    FHWA Response: FHWA believes a discussion of HUD-specific policy 
for Section 8 tenants' eligibility for voluntary acquisition is beyond 
the scope of this rulemaking; however, FHWA notes that tenant 
eligibility requirements discussed in this rulemaking are applicable to 
Federal and federally assisted projects and programs. (see Sec.  
24.203(d)).
    FHWA understands the questions about Federal participation in 
voluntary acquisition costs; however, because of the wide variation in 
the scenarios that may occur, FHWA cannot reasonably or comprehensively 
describe the applicability of initiation of negotiations or, more 
generally, policies for determining eligibility for Federal 
participation in voluntary acquisition costs for each Federal agency. 
FHWA has information on its website \1\ which describes FHWA's Federal 
participation eligibilities for voluntary acquisitions and may develop 
one or more FAQs to generally respond to Federal eligibility questions 
and point to some FHWA informational resources. However, it is 
important to note that displacing agencies should check with the 
Federal funding agency to receive additional guidance on voluntary 
acquisition eligibility determinations.
---------------------------------------------------------------------------

    \1\ https://www.fhwa.dot.gov/real_estate/index.cfm.
---------------------------------------------------------------------------

    As a result of the above analysis, no changes were made in response 
to these comments.
Mortgage
    One commenter advised that use of the term ``mortgage'' for 
mortgages instead of ``lien'' is preferred as there are many types of 
liens, and not all create a possessory interest in the subject 
property.
    FHWA Response: There was no proposed change in the NPRM to the 
definition of the term ``mortgage'' found in Sec.  24.2(a). The 
definition found in the statute at 42 U.S.C. 4601(9), describes a 
mortgage as classes of liens commonly given to secure advances on, or 
the unpaid purchase price of, real property, under the laws of the 
State in which the real property is located, together with the credit 
instruments, if any, secured thereby. The definition in the statute and 
regulation continues to provide the various Uniform Act partner 
agencies with a comprehensive definition, which meets their needs and 
ensures Uniform Act requirements are met.
    As a result of the above analysis, no changes were made to this 
section of the final rule.
Reverse Mortgages (Also Known as Home Equity Conversion Mortgages 
(HECM)), and Section 24.401(e)
    The NPRM included a preamble discussion of HECMs, a new definition 
(which acknowledged HECMs also are known as ``reverse mortgages''), and 
changes to other parts of the regulation and appendix A. One commenter 
was supportive of the proposed additions of a definition and a 
regulatory section describing requirements to calculate and document 
eligibility and reimbursement for costs associated with replacing a 
HECM.
    The FHWA Response: The FHWA appreciates the comments. After 
publication of this final rule, FHWA will continue to monitor the 
development and growth of this market.
    After further analysis, FHWA will revise the final rule by 
replacing the term ``HECM'' with ``Reverse Mortgage.'' The FHWA 
believes that making this change will help to provide a clearer 
reference in the final rule. ``Reverse Mortgage'' is a more generic 
term, while HECM is a specific term used in the Federal Housing 
Administration (FHA) Program for reverse mortgages. The more common 
term should be easier to understand and more clearly encompasses 
reverse mortgages that may not qualify as an FHA HECM. FHWA also thinks 
it is important to note that this rule does not guarantee that a 
displaced person will be eligible for an FHA reverse mortgage. 
Displaced persons seeking a replacement reverse mortgage will continue 
to have to meet the financial institution's lending and underwriting 
requirements. For example, those displaced persons who want to obtain 
an FHA-insured reverse mortgage will have to meet FHA's eligibility 
requirements at 12 U.S.C. 1715z-20 and HECM regulations at 24 CFR part 
206.12. Appendix A for the final rule has also been revised to include 
additional discussion of FHA reverse mortgage counseling requirements 
that are applicable to a displaced person who wishes to purchase an FHA 
insured mortgage and other counseling resources that a displaced person 
with a reverse mortgage may utilize.
    The NPRM also discussed development of a calculator for reverse 
mortgage interest differential payments. FHWA determined that 
development of such a tool is not immediately practical. FHWA may 
consider revisiting this determination once agencies have had more 
experience with reverse mortgages and more data on payments is 
available. FHWA will look for information and opportunities to develop 
best practices,

[[Page 36916]]

case studies, and other similar tools to document and share practical 
methods of calculation of eligibility and reimbursements due to 
displaced persons.
Owner's Designated Representative and Manner of Notices
    FHWA received six comments on the proposal to allow owners to 
designate a representative. Three of the six comments supported 
allowing an owner to designate a representative and the requirement 
that the designation must be in writing. One commenter inquired about 
the authority of the representative to elect to receive electronic 
notices without express written authorization from the property owner 
and asked whether occupants can similarly designate a representative. 
Two commenters recommended keeping the current regulation's language 
requiring that offers be made to the property owner instead of the 
NPRM's proposal to allow either the owner or the owner's designated 
representative to receive the offer. They reasoned that this is the 
only time there will be a face-to-face meeting with the owner to 
explain the project and present the offer. (See Sec.  24.102(f)).
    FHWA Response: FHWA believes that allowing an owner or tenant to 
provide a written notice designating a representative to receive 
offers, required notices, correspondence, and information in no way 
diminishes a property owner's or tenant's rights. FHWA agrees that the 
preferred method of making an offer to acquire is to make the offer 
directly to the property owner, and at that time, the property owner 
may designate in writing, a representative to receive all subsequent 
required notifications and documents from the agency. This ensures the 
owner receives the offer and the owner designates the representative. 
However, FHWA recognizes that occasionally there may be instances where 
an owner may wish to designate a representative prior to the initial 
offer. For example, designation could be used when the owner may not be 
able to meet because of illness or may be out of the country. FHWA 
agrees that the ability to designate a representative should include 
displaced occupants.
    This final rule will include a revision to the definitions at 
Sec. Sec.  24.2(a) and 24.5(d) to clarify that tenants may also 
designate a representative. It is noted, however, that relocations 
require an interview during which the displaced person provides 
information on their needs and preferences. FHWA believes it is always 
preferable that the displaced person be present with their 
representative when a home inspection and interview are conducted 
because the purpose of the interview is to determine the displaced 
person's needs, which sometimes requires answers to questions 
concerning their preferences and the displaced person is likely the 
only person who can fully respond to such questions. FHWA believes that 
when the owner or tenant designates a representative, they should 
stipulate in writing specifically what the representative is authorized 
to do. As a best practice, FHWA also believes that the written 
designation should specifically state what the representative is not 
authorized to do. For example, if an owner does not want the 
representative to use electronic means to communicate, then it should 
be stipulated within the written designation.
Program or Project
    FHWA received one comment requesting the addition of a definition 
for the word ``undertaking'' within the definition of ``program or 
project.''
    FHWA Response: FHWA reviewed the use of the word ``undertaking'' in 
this NPRM and notes that the use of the term is not a proposed change. 
The term can be found in use in the definition of program or project 
and in an Appendix A discussion of Sec.  24.103(b), Influence of the 
project on just compensation. The FHWA believes that in both instances 
where this term occurs in the regulation it does not carry any meaning 
beyond the commonly understood use of the term and its use does not 
change or impact either the definition or the appendix A item.
    As a result of the above analysis, no changes were made to this 
section of the final rule.
Small Business
    One comment agreed that signs on property to be acquired should be 
relocated as personal property, and without the reestablishment 
benefits such as utility hook-ups at a replacement location.
    FHWA Response: The NPRM preamble discussion of the definition of 
small business acknowledges that FHWA has often been asked for guidance 
on the question of whether sites occupied solely by outdoor advertising 
signs, displays, or devices qualify for benefits as a small business 
under Sec. Sec.  24.303 and 24.304. FHWA clarified that sites occupied 
solely by outdoor advertising signs, displays, or devices do not 
qualify for these benefits by adding a reference to Sec.  24.303 in the 
last sentence of the definition of small business, as proposed in the 
NPRM. FHWA believes that outdoor advertising signs are to be treated as 
personal property. The final rule allows that owners of outdoor 
advertising signs may receive either an amount for a direct loss of an 
outdoor advertising sign, Sec.  24.301(f), or when applicable the 
estimated cost of moving the sign to include those costs discussed in 
Sec.  24.301(g), but with no allowance for storage.
    As a result of the above analysis, no changes were made to this 
section of the final rule.
Temporary, Daily, or Emergency Shelter
    FHWA received two comments regarding the definition of ``temporary, 
daily, or emergency shelter.'' One commenter expressed support of the 
definition and reasoned that it affirms the commenter's belief that 
persons with informal non-shelter living arrangements may be considered 
displaced. One commenter believed that ``temporary shelter'' is not 
defined in the NPRM.
    FHWA Response: FHWA believes this definition only applies to 
occupants of emergency, temporary, or daily shelters. These shelters 
are typically intended as an overnight, short term, short duration 
accommodation, and therefore the persons utilizing these accommodations 
are in most cases not ``displaced persons'' because their 
accommodations do not meet the definition of a ``dwelling.'' This final 
rule will define a ``dwelling'' as ``the place of permanent or 
customary and usual residence of a person according to local custom or 
law.''
    FHWA notes that the NPRM and this final rule include a discussion 
of those who temporarily occupy a shelter in the definition of 
displaced persons and persons not displaced. FHWA believes that the 
definition and the discussion of persons not displaced in this final 
rule provide details that will ensure displacing agencies can make the 
appropriate determination of whether a person is a displaced person or 
a person not displaced for those occupants who are required to move 
from a shelter.
    Certain HUD-assisted emergency shelters do not allow for continued 
or prolonged occupancy and may not be considered dwellings under HUD 
programs or projects. The McKinney-Vento Homeless Assistance Act 
defines a ``homeless person'' to include ``an individual or family 
living in a supervised publicly or privately operated shelter 
designated to provide temporary living arrangements (including hotels 
and motels paid for by Federal, State, or local government programs for 
low-income individuals or by charitable organizations, congregate

[[Page 36917]]

shelters, and transitional housing).'' 42 U.S.C. 11302(a)(3).
    As a result of the above analysis, no changes were made to this 
section of the final rule.
Waiver Valuation
    Two commenters stated that the definition of ``waiver valuation'' 
needed to be augmented with language that clearly states that a waiver 
valuation is not an appraisal. One of those two commenters proposed 
moving language found previously in the appendix A explanation for the 
definition directly into the regulatory text. A third commenter 
suggested that the regulation be revised to acknowledge a waiver 
valuation is an appraisal. One commenter suggested that the waiver 
valuation language in Sec. Sec.  24.102(c) and 24.102(d) was 
unnecessary if it was indeed an appraisal.
    FHWA Response: The Uniform Act permits the Lead Agency to prescribe 
a procedure to waive the appraisal in cases involving the acquisition 
by sale or donation of property with a low fair market value. In such 
circumstances, the current regulatory text allows the use of a waiver 
valuation procedure in lieu of an appraisal. State licensure boards 
have generally viewed any opinion of value issued by one of their 
licensees to be an appraisal. Those who are licensed find themselves 
looking for clarity as to when and how the Uniform Act regulation 
requirements intertwine with the standards of their State licensure 
boards. As a result, FHWA revised the definition by including 
declarative statements within the body of this final rule including 
those at Sec.  24.2(a), definition of ``waiver valuation'' and Sec.  
24.102(c) ``Appraisal, waiver thereof, and invitation to owner'' that 
waiver valuations are not appraisals as defined in the Uniform Act and 
this rule. FHWA may also develop an FAQ to provide additional guidance 
and clarity on the requirements and use of a waiver valuation in this 
regulation.

Section 24.5 Manner of Notices and Electronic Signatures

    Four commenters strongly supported the additional flexibility of 
using e-delivery and e-signatures as a positive change that should 
expedite service and reduce waste. They noted that allowing the use of 
electronic notifications are long overdue and supports allowing more 
flexibility in notice delivery, particularly the ability to notify 
tenants via electronic means. One commenter agreed that personal 
contact is the best practice but acknowledged that property owners 
sometimes do not want to meet or in some instances may prefer very 
limited meetings. One commenter noted that Appendix A provided examples 
of instances when electronic deliveries of notices are appropriate and 
suggested since the examples are not actual notices required by 
agencies, the examples should be stricken. One commenter requested 
clarification on whether agencies who have existing policies for 
providing electronic notices, with residents' or owners' permission, 
which meet the requirements outlined in the NPRM, are sufficient to 
permit the agency to serve notices by electronic means. One commenter 
was concerned that the NPRM, at times, seems to blend the e-delivery 
and e-signature requirements when they are two distinct processes, e-
signature requiring more robust technology, more procedural 
adaptations, and greater financial investment than e-delivery. The 
commenter requested clarification on whether both are allowed and asked 
whether an agency could elect to use one and not the other. Also, the 
commenter suggested removal of the additional language in the appendix, 
e.g., ``agencies must determine and document instances when electronic 
deliveries of notices are appropriate.''
    FHWA Response: FHWA believes that delivery of notices by digital or 
electronic means can provide agencies and property owners and displaced 
persons with an optional communication method that can streamline the 
offer, negotiation, and notice processes while not reducing any 
benefits or protection to property owners and displaced persons. FHWA 
agrees that the examples listed in appendix A, Sec.  24.5, are not 
examples of required notices. However, electronic delivery is not 
limited to agency required notices. In addition to notices, offers, 
correspondence, and information may be sent by electronic means. (See 
Sec.  24.5(d)). FHWA revised the language in appendix A to provide some 
examples of the various acquisition and relocation assistance 
requirements and activities such as notices, offers, and documents that 
may be delivered by electronic means. Appendix A was also revised by 
adding in references and additional information on the process for 
approval and use of electronic signature.
    FHWA agrees that an agency with an existing program for providing 
electronic notices to residents and owners that meets the final rule's 
requirements and is documented in the approved agency's policies and 
procedures, could meet the requirements in the final rule for serving 
notices electronically.
    FHWA agrees with one commenter that the e-delivery and e-signatures 
are two distinct processes. FHWA believes the NPRM identifies those 
differences and discusses their use. Those changes have been 
incorporated into the final rule by revising the title of Sec.  24.5 to 
include reference to electronic signatures, by revising the language in 
Sec.  24.5(b) to refer to a required ``process'' instead of a 
``method'' to clarify that a Federal funding agency must approve a 
process that would include methods used to comply with requirements, 
and by revising Sec.  24.5(d) to clarify that this section applies to 
property owners and tenants, and that property owners and tenants may 
also elect to provide signatures needed by the agency electronically. 
The final rule includes a new Sec.  24.5(e) which was included to 
specifically address electronic signature requirements.
    An agency requesting use of electronic delivery of notices must 
include a process to document and record when information is legally 
delivered in digital format. A date and timestamp must establish the 
date of delivery and receipt with an electronic record capable of 
retention. In addition, an agency requesting to use electronic 
signature must include a method to link the electronic signature with 
an electronic document in a way that can be used to verify the 
signature and determine whether the electronic document was changed 
subsequent to when an electronic signature was applied to the document.
    As requested by one commenter, FHWA clarified in the final rule's 
appendix A that an agency may use electronic delivery or electronic 
signatures and must document the circumstances under which they are 
allowed.

Section 24.9(c) Recordkeeping and Reports

    FHWA received one comment regarding the annual reporting of Uniform 
Act program activities required of Federal agencies. The commenter 
believes that the additional reporting requirement needs more 
clarification or a form to be used.
    FHWA Response: As discussed in the NPRM preamble, the change in the 
reporting requirement in Sec.  24.9(c) is being implemented in 
accordance with Section 1521(d) of MAP-21 and impacts Federal agencies 
only. The current regulatory text for this section states that the form 
for completing this activity is in appendix B. This final rule will 
include reporting options available to Federal agencies in appendix A. 
The two options are to use the reporting

[[Page 36918]]

form in subpart B or develop a narrative report on the Federal agency's 
efforts during the year to enhance delivery of Uniform Act benefits and 
services. Each Federal agency is required to provide an annual summary 
report of its acquisition and displacement activity to the Lead Agency 
by November 15. FHWA revised this section of appendix B by including a 
further discussion of some of the information that Funding agencies may 
want to include in their annual report.

Section 24.11 Adjustments of Limits and Payments

    FHWA received eight comments on the adjustment of relocation 
benefits proposal in the NPRM.
    One commenter requested that the 2012 MAP-21 statutory benefit 
updates be included in this final rule. This same commenter recommends 
that FHWA immediately adjust the statutory maximum rental assistance 
payment, irrespective of the proposed rulemaking, based upon the cost 
of living, and other factors, where the Lead Agency ``determines that 
cost of living, inflation or other factors indicate that the payments 
should be adjusted to meet the policy objectives of this chapter.'' (42 
U.S.C. 4633(d)). One commenter stated that the maximum statutory 
benefit limit amount of $25,000 for eligible nonresidential 
reestablishment expenses should be raised to $50,000 because many 
businesses incur costs that exceed the current maximum benefit amount 
when required to relocate. Another commenter also recommended 
increasing the nonresidential re-establishment benefit limit of $10,000 
to $65,000, based on a market average of $55,000, and the 
nonresidential fixed payment for moving expenses from $20,000 to 
$70,000, based on a market average of $60,000 and incidental inflation 
rates ranging from 2.1 percent to just over 6 percent over the past 5 
years. This same commenter recommends increasing the Replacement 
Housing Payment (RHP) for 180-day homeowner-occupants from $22,500 to 
$75,000, based on a market average RHP of $55,000 for rural and 
suburban areas, and over $100,000 for the commenter's local urban 
markets, and average increases in property values in the commenter's 
State of around 4.9 percent per year; housing demand compared to 
supply; and listings selling for an average of 2-5 percent over the 
listing price.
    One commenter asked if the final rule could include a method to 
develop an index to be used annually to automatically update certain 
payments and benefits in the final rule. One commenter asked for 
details on how and when updates to the regulatory amounts would be made 
and had concerns about how projects in process when the regulatory 
limits were updated would be handled, and specifically asked how the 
requirement for fair, uniform, and equitable treatment of all affected 
persons would be met when an update to certain benefits occurred. This 
same commenter also asked whether FHWA would adjust certain benefits 
downward or would only adjust upwards to account for inflation. Another 
commenter recommended that FHWA post proposed revised UA benefit levels 
for a public comment period prior to adopting them so that recipients 
can assess the impact and adequacy of the new benefit levels.
    One commenter proposed that FHWA consider using other indexes for 
this section because the use of specific inflation measures is best 
suited to specific types of benefits, such as the Federal Housing 
Finance Administration House Price Index for replacement housing and 
rental assistance payments. The commenter believes that using more 
specific measures as the basis for payment adjustments would best 
reflect the cost of living and reduce hardship for displaced persons.
    FHWA Response: FHWA noted some confusion from recipients about the 
effective dates for amendments to the Uniform Act in section 1521 of 
MAP-21. By law, these changes became effective on October 1, 2014. MAP-
21 amended the maximum statutory benefit for replacement housing 
payments for displaced homeowners to $31,000, and replacement housing 
payments for displaced tenants to $7,200. The length of occupancy 
requirement for homeowners was reduced from 180 days to 90 days in 
occupancy before the initiation of negotiations. MAP-21 also amended 
the maximum statutory benefit for business reestablishment benefits to 
$25,000, and the fixed payment for nonresidential moves to $40,000. The 
confusion may stem from the fact that the current regulatory text was 
not amended after the passage of MAP-21 to reflect the new statutory 
amounts, until this rulemaking. These benefit amounts are established 
in the statute. However, it is important to note that this final rule 
does include authority to adjust certain benefit levels to account for 
inflation.
    FHWA has included adjustments to certain benefit levels established 
by statute in this final rule. These have remained unadjusted since 
October 1, 2014, and consequently their ability to meet the policy 
objectives of the Uniform Act has been diminished by the effects of 
inflation. The adjustments to those benefit levels were made by 
calculations using the June 2023 Consumer Price Index for All Urban 
Consumers (CPI-U) adjustments.
    In developing this regulation, FHWA considered the practical 
effects of updating certain benefit amounts periodically. FHWA notes 
that in past final rules for this part and implementation of certain 
MAP-21 updates to the Uniform Act, there has usually been an 
implementation period of one or more years. Recipients may need time to 
allow for local legislative changes necessary for implementation; 
others may require time to develop an update to their program manuals 
and to then have them approved by the Federal funding agency. However, 
FHWA agrees that limiting consideration of the need to update benefit 
limits to every 5 years may not allow FHWA to make necessary timely 
updates.
    In response to the commenter who asked about making downward 
adjustments, this final rule does not contain a prohibition against 
making a downward benefit adjustment should a calculation indicate that 
a downward adjustment might be warranted.
    FHWA reviewed the commenter's request to use other indexes as the 
basis for determining the necessity of an update to certain regulatory 
benefit amounts. As FHWA noted in the NPRM preamble, the CPI-U 
represents 87 percent of the total U.S. population, is available on a 
monthly basis free of charge, and is used by several other Federal 
agencies. FHWA understands that many indexes are available, and each 
may have some specific advantage or measure. In considering the 
measures that may currently best determine whether a benefit update is 
needed, at this time FHWA continues to believe that CPI-U best 
represents the costs incurred by our relocatees and therefore is a good 
indicator for determining the effects of inflation that are experienced 
by those displaced. However, FHWA also agrees with several comments 
suggesting that FHWA further consider whether there may be indexes that 
provide more specific measures as the basis for payment adjustments 
that would best reflect the cost of living and reduce hardship to 
displaced persons.
    FHWA also received comments discussed in Sec.  24.102(c)(2)(ii) 
Basic Acquisition Policies--Negotiation procedures; appraisal, waiver 
thereof, and invitation to owner which in part suggested that some 
waiver valuation limits should also be adjusted as described in this 
section.
    As a result of the above analysis, FHWA has revised this section by

[[Page 36919]]

eliminating the language restricting consideration of benefit updates 
to no more frequently than every 5 years. The final rule will allow the 
head of the Lead Agency to carry out an evaluation when there is 
concern that certain benefit levels no longer support the policy 
objectives of the Uniform Act. Such determinations will in part 
consider implementation challenges and concerns including allowing 
appropriate time for Federal agencies and recipients to take the 
necessary administrative steps to implement benefit updates and 
changes. The FHWA believes that should an update to the benefit amounts 
be necessary, each Federal funding agency will need to develop policies 
and procedures for ensuring that the implementation of updates to 
benefit amounts is fair, uniform, and equitable. One method to ensure 
that the updating of benefits is fair, uniform, and equitable might be 
to decide that for projects underway before an update is effective, 
displaced persons will continue to be eligible for the amount in the 
regulations at the initiation of negotiations.
    After publication of the final rule, FHWA intends to publish a 
Request for Information (RFI) to ask stakeholders whether there may be 
an index which better reflects costs associated with specific 
relocation benefits and which provide more precise indication of the 
effects of inflation. Based on the RFI, FHWA may consider further 
regulatory changes to address issues including whether additional or 
other indexes should be used to determine the need to update benefit 
levels, whether additional relocation benefits should be adjusted based 
on use of new indexes or other comments provided in the RFI, what basis 
should be used for the adjustments, and at what intervals adjustments 
should be made.
    FHWA also revised this section by changing the section title and 
including additional benefit level payments that may be adjusted 
including waiver valuation limits and applicable sections on mobile 
homes at Sec.  24.502 and Sec.  24.503. FHWA believes that as discussed 
in response to comments in Sec.  24.102(c)(2)(ii) Basic Acquisition 
Policies--Negotiation Procedures; appraisal, waiver thereof, and 
invitation to owner, allowing adjustment of waiver valuation limits in 
this section will ensure that the effects of inflation do not 
unnecessarily restrict appropriate use of waiver valuations. FHWA also 
revised this section by adding in specific references to tenants of 
mobile homes to more clearly provide applicable references to all 
tenant eligibilities which may be adjusted as described in this section 
of the regulation.

Subpart B--Real Property Acquisition

Section 24.101(b) Applicability of Acquisition Requirements--Voluntary 
Acquisitions

    FHWA received 15 comments on this section of the regulations. The 
comments focused on several related questions regarding proposed 
changes including: application and interpretation of Sec.  24.101(b); 
use of Sec.  24.7, Federal agency waiver of regulations of this part; 
applicability to specific Federal funding agency programs, 
interpretation and applicability of Sec.  24.101(b)(1)(i) through 
(iii); and the proposed addition of Sec.  24.101(d)(2) and (3).
    FHWA Response: FHWA developed the proposed changes in the NPRM to 
address questions it has received over the years about the intent and 
applicability of the voluntary acquisition provisions. These questions 
have been raised by both our Federal agency partners and the public. 
The NPRM preamble noted that one of the goals of the proposed 
reorganization was to clarify the meaning, interpretation, and 
application of the terms geographic area and site (Sec.  
24.101(b)(1)(i)). The NPRM noted that some Federal agencies reported 
that terms were close enough in meaning that they caused confusion. 
Those Federal agencies stated that the term ``site'' did not accurately 
describe the type of project needs encountered in delivering their 
programs and recommended changing the term to ``property.'' The NPRM 
further noted that some agencies possess the power of eminent domain 
but do not use it for specific projects. FHWA received questions about 
the interpretation of this paragraph from several agencies. Some 
agencies have interpreted this paragraph to mean that if an agency 
possesses the power of eminent domain but will not use it on the 
project, the agency would not be able to use the voluntary acquisition 
authority for its project or program.
    FHWA's approach in the NPRM was to attempt to clarify and simplify 
the language in Sec.  24.101(b)(1)(i) through (iii). The comments 
received on various issues related to or involving voluntary 
acquisitions led FHWA to believe that the NPRM's proposed changes 
addressed some of the issues and questions, but not all. In considering 
the comments and the variety of questions, FHWA proposes to further 
revise this section in the final rule. The FHWA removed Sec. Sec.  
24.101(b)(2) and (3) and reorganized Sec.  24.101(b)(1) in the final 
rule to clarify the requirements and qualifications for determining 
when a voluntary acquisition may be advanced for Federal and federally 
assisted programs and projects. FHWA believes these revisions 
streamline the voluntary acquisition requirements and clarify 
applicability. FHWA will include a new Sec.  24.101(b)(1) which clearly 
states that if eminent domain will not be used and certain other 
conditions are met, then an agency may use the voluntary acquisition 
requirements provided by this section. FHWA is proposing no change to 
Sec.  24.101(a) applicability and requirements. FHWA will address all 
other questions related to aspects of voluntary acquisition separately 
in this preamble and will incorporate the revised requirements of Sec.  
24.101(b)(1) in the responses and changes to the regulatory text.

Section 24.101(b) Applicability of Acquisition Requirements--Voluntary 
Acquisitions, Comments Related to Federal Agency Policies and 
Procedures

    FHWA received several comments requesting clarification of 
voluntary acquisition requirements applicability to HUD programs. The 
commenters suggested that they had significant difficulties in applying 
the Uniform Act's voluntary acquisition regulations to HUD programs. 
One commenter asked how an existing Section 8 contract being 
transferred to an owner acquiring and rehabbing a project fit into 
Sec.  24.101(b) since Section 8 contract funds are rental subsidies 
that cover operating costs; the funds are not being used to acquire 
real property for a project or program. The commenter also noted that 
the acquisition notice at Sec.  24.101(b)(2)(iii) has been applied by 
HUD to transactions between private parties. The commenter does not 
believe this application is consistent with the voluntary acquisitions 
requirements and further explains that there is no need for a private 
buyer to inform a private seller that they are not using their eminent 
domain authority to acquire their property because it is an authority 
they do not have.
    Another commenter believes that the Uniform Act presumes a Federal 
agency is the acquiring party and a private homeowner, business, or 
farm owner is the seller. The commenter noted that this dynamic is 
entirely distinct from the Federal affordable housing programs when an 
owner of existing federally assisted rural housing is selling or 
refinancing their rural affordable multifamily property. The commenter 
requested that the following be exempt from Sec.  24.101(b) compliance: 
``transfers,

[[Page 36920]]

rehabilitations or demolitions of affordable housing assets restricted, 
subsidized or otherwise assisted or to be restricted, subsidized or 
otherwise assisted under Federal housing programs.''
    FHWA Response: Because several Federal agencies have programs, 
policies, and procedures that have aspects unique to that Federal 
agency, this rulemaking does not address the interplay between these 
requirements and other Federal agency programs. Some programs focus on 
planned and federally assisted rehabilitation which requires a 
temporary move. Others may require demolition and rebuilding of the 
structure which also may require a temporary move or permanent 
displacement. There are many scenarios that are not clearly either a 
voluntary acquisition or an acquisition of real property rights. To 
qualify as a voluntary acquisition under Sec.  24.101(b)(1) an 
acquisition of real property rights would be pursuant to a Federal or 
federally assisted project or program and would not use the authority 
of eminent domain to acquire the real property rights. Voluntary 
acquisitions that meet these two requirements would be subject to 
compliance with the voluntary acquisition requirements of this rule.
    In another commenter's example, another Federal agency was 
providing Federal financial assistance to support the rehabilitation or 
redevelopment of privately owned real property. After redevelopment or 
rehabilitation of that property, it would continue to be privately 
owned but would be required to be used for Section 8 housing. In this 
instance, an agency must determine whether and how the use of Federal 
funding or Federal financial assistance provided would require 
compliance with the requirements of the Uniform Act. Generally, when 
Federal funding or Federal financial assistance is used for a project 
or program and there is either an acquisition of real property rights 
or occupants will be displaced the Uniform Act requirements would 
apply. If the Uniform Act requirements apply, then tenants and owners 
who were in occupancy on the real property that is being redeveloped 
would be eligible for assistance because they would be either displaced 
persons or persons required to move temporarily.
    If the determination was made that the acquisition of real property 
rights was done in anticipation of receiving subsequent Federal 
financial assistance for a planned or anticipated project or program, 
then tenants and owners occupying the real property would be either 
displaced persons or persons required to move temporarily as defined in 
this rule and would be entitled to benefits and assistance under this 
regulation. Similarly, FHWA does agree that a private market sale 
carried out between a willing buyer and seller, which was not done in 
anticipation of later incorporating that property into a planned or 
anticipated project or program which would receive Federal financial 
assistance, would not be subject to the voluntary acquisition 
requirements of this part because the purchase of the real property 
rights was not a part of or required by a Federal or federally assisted 
project or program.
    While the Uniform Act's overarching goal is to ensure equitable 
treatment of those impacted by Federal and federally assisted projects 
and programs, each Federal funding agency may have programs with unique 
characteristics and requirements and the Federal funding agency would 
need to provide specific guidance on Uniform Act compliance. HUD should 
be consulted for guidance on voluntary acquisition for HUD-funded or -
supported projects and programs.
    As a result of the above analysis, no changes were made to the 
final rule in response to these comments.

Section 24.101(b)(1) Applicability of Acquisition Requirements--
Voluntary Acquisitions; Waiver of Regulations To Use Eminent Domain

    FHWA received nine comments on the proposal to allow, in limited 
instances, a waiver of regulations to allow the use of eminent domain 
to acquire needed property when a voluntary acquisition did not result 
in an agreement. One commenter supported the proposed ability to seek a 
waiver to use eminent domain if a voluntary acquisition cannot be 
finalized. Four commenters object to an agency using eminent domain 
authority after a failed voluntary acquisition and believed that it 
rewards poor policy and planning, will lessen public respect and trust 
for the agency, and it could be used coercively. Commenters also noted 
that if an agency was to use a waiver, it would naturally lead to 
inconsistent treatment of property owners if some properties on a 
project are acquired by voluntary acquisition and others are acquired 
under threat of eminent domain.
    One commenter agrees that if the NPRM provision is adopted, a 
waiver of regulations could be justified when an unanticipated and 
unplanned need arises. The commenter specifically mentioned a scenario 
where a voluntary acquisition resulted in an agreement to sell but 
there are liens or other encumbrances on the property's title. The 
commentor noted that agencies sometimes make what is referred to as a 
friendly condemnation in order to clear the property's title.
    All commenters requested additional guidance clarifying when such 
waivers may be acceptable. One commenter believes the NPRM's proposed 
revisions to Sec. Sec.  24.101(b)(1) and (2) are more ambiguous as to 
when the voluntary acquisition project should comply with the various 
requirements and in determining when these criteria are applicable in 
different acquisition scenarios, such as when an agency has eminent 
domain authority and when an agency does not.
    Two commenters focused on the term ``voluntary acquisition''. One 
commenter requested that the opening paragraph of Sec.  24.101(b) use 
the term ``voluntary'' acquisitions since this is the common term used 
in the regulations. Also, one commenter requested further clarification 
or examples for the use of voluntary acquisitions.
    FHWA Response: The intent of the proposed changes was to address 
questions FHWA received in the past about use of eminent domain 
authority and voluntary acquisitions and to clarify interpretations of 
long-standing policy and requirements.
    The purpose of the voluntary acquisition regulations and 
requirements is to allow a streamlined method for acquiring real 
property for public projects when a property owner is not compelled or 
required to sell his real property. This streamlined method ensures 
that property owners are informed in writing that their property will 
not be acquired if negotiations fail to result in an amicable agreement 
and are provided a statement of what the acquiring agency believes to 
be the fair market value of the property.
    FHWA believes that the comments received indicate that the NPRM's 
proposed changes to this portion of the rulemaking focused on possible 
use of eminent domain after a voluntary acquisition offer raised as 
many additional questions as were answered. FHWA understands and agrees 
with the commenters' concerns about allowing acquisitions by eminent 
domain when negotiations were initially undertaken as a voluntary 
acquisition. FHWA also agrees that opportunities for coercive actions 
using the threat of possible eminent domain is an important concern. 
However, FHWA does not agree that the intent of the NPRM proposal was 
to more frequently allow an agency to simply change its mind about 
using eminent domain. FHWA

[[Page 36921]]

views the clear purpose of the provision as ensuring that voluntary 
acquisitions are not simply preludes to an eminent domain acquisition, 
should voluntary acquisition negotiations fail. However, FHWA also 
recognizes that there may be an extraordinary circumstance in which use 
of eminent domain may be necessary. For example, the use of eminent 
domain may be necessary in the aftermath of a major disaster or a 
presidentially declared national emergency, as indicated in Sec.  
24.404(b) of this final rule, or to clear properties with clouded 
titles or similar defects in the title. In those instances, the Federal 
funding agency may consider granting a waiver of regulations under 
authority of Sec.  24.7 of this part. The Federal funding agency will 
make a fact-based, case-by-case determination as to whether a waiver of 
the regulation's requirements may be allowed.
    FHWA believes that the best way to clarify this section of the 
regulation is to simplify the discussion by removing the discussion of 
use of eminent domain and waiver of regulations from this section. As a 
result of this analysis, the final rule will be modified by eliminating 
the provisions describing the use of eminent domain both in the 
regulation and in Appendix A to focus only on the use of voluntary 
acquisition and its requirements. As discussed earlier in this 
preamble, FHWA removed Sec. Sec.  24.101(b)(2) and (b)(3) and 
reorganized Sec.  24.101(b)(1) in the final rule to clarify when a 
voluntary acquisition may be used for a Federal and federally assisted 
program or projects. The Appendix A discussion of Section 
24.101(b)(2)(iii) was also removed. FHWA believes these revisions 
streamline the voluntary acquisition requirements and clarify 
applicability.

Section 24.101(b)(1) Applicability of Acquisition Requirements--
Voluntary Acquisitions; Owner Occupant Eligibility as a Displaced 
Person as a Result of a Voluntary Acquisition Project

    One commenter asked about owner-occupants whose property was 
acquired by voluntary acquisition not being eligible for relocation 
assistance as a displaced person if an agency should later acquire 
adjoining properties owned by the same person by eminent domain for a 
public improvement project.
    FHWA Response: FHWA believes that agencies, when acquiring property 
through voluntary acquisition, are obligated to advise owner-occupants 
that, as a willing seller, they are not eligible for relocation 
assistance as displaced persons, prior to making the offer to acquire. 
FHWA notes that as stated in the NPRM preamble if eminent domain will 
not be used, then an agency may use the voluntary acquisition 
requirements provided by this section. FHWA believes that whether an 
agency has such authority is not the relevant issue in determining 
whether this section's requirements are being met. The relevant issue 
is that eminent domain may not be used as part of the offer and 
negotiation to acquire property needed for the project. An agency using 
voluntary acquisition provisions of this rule must, in part, inform the 
owner of the property or the owner's designated representative in 
writing if the agency will not acquire the property if negotiations 
fail to result in an amicable agreement.
    FHWA believes an initial use of voluntary acquisition of a property 
to advance a project or program, in most, if not all instances, 
prohibits the later use of eminent domain authority to acquire the 
property in order to advance that same project or program.
    As a result of the above analysis, no changes were made to the 
final rule in response to this comment.

Section 24.101(b) and 24.101(d); Questions About Inconsistency of 
Requirements

    One commenter believes there is a conflict between Sec. Sec.  
24.101(b) and (d) when compliance with subpart B is discussed. The 
commenter requested additional information in this section to explain 
when acquisitions are exempt from this subpart and if agencies can 
still require appraisals for these transactions as stated in appendix A 
Sec.  24.101(b).
    FHWA Response: FHWA believes the language in Sec. Sec.  24.101(b) 
and (d) do not conflict. The applicability of subpart B and those 
instances where the requirements of subpart B may not apply are 
described in Sec.  24.101(b). Section 24.101(d) continues to apply to 
projects and programs that are not exempted in Sec.  24.101(b). The 
language in Sec.  24.101(d) was discussed in the 1989 final rule which 
notes that the discussion of applicability and to the greatest extent 
practicable under State law is the same as that found in section 
46555(a) of the Uniform Act. FHWA interprets this to mean an agency 
must comply if compliance is legally possible under State law. This 
should be considered in an agency's assurances pursuant to Sec.  
24.4(a). This section does not duplicate or nullify the requirements of 
Sec.  24.101(b).
    While voluntary acquisitions do not require appraisals, agencies 
may continue to decide that an appraisal or wavier valuation is 
necessary to support their determination of the fair market value of 
these properties. However, properties acquired in advance of approval 
of a Federal or federally assisted project or program (including prior 
to a NEPA decision where such acquisitions are allowed under an 
agency's programs) with the purpose or intent of being incorporated 
into a Federal or federally assisted project or program must meet the 
applicable Subpart B requirements.
    As a result of this analysis, no changes were made to these 
sections of the regulation.

Sections 24.101(b)(1) and 24.101(d)(2) and (3); Acquisition of Real 
Property in Advance of Federal Authorization or a Federal Project 
Designation With the Intent of Later Incorporated Into a Federally 
Assisted Project.

    FHWA received three comments on determining the intent of some real 
property acquisitions completed in advance of Federal authorization or 
of a Federal project designation which these commenters identified as 
acquisitions that are completed prior to a project or program that will 
receive Federal financial assistance. One commenter requested 
clarification on whether determining the intent of the original 
acquisition of property matters, and if so, what documentation would be 
needed. The commenter further noted that the word ``intent'' is used to 
clarify that property acquired with the intent of including it in a 
Federal or federally assisted project or program, would require 
compliance to the requirements in subparts B-F; however, the commenter 
noted the NPRM proposal simply states that any property acquired which 
may later be incorporated requires compliance. The second commenter 
requested that additional language be added to 49 CFR part 24 regarding 
the applicability of the Uniform Act when an agency contracts with a 
private third-party to satisfy the necessary environmental wetland 
mitigation requirements. Specifically, whether the Uniform Act applies 
at all, and if so, whether voluntary acquisitions under Sec.  
24.101(b)(2) can be utilized to comply with the Uniform Act. One 
commenter suggested that owners of property for sale on the open market 
before the acquisition began or that intend to sell their property 
despite the transportation project be considered as a voluntary 
acquisition and excluded from receiving relocation benefits because a 
property owner that intends to sell his/her property despite the 
transportation project is already planning for these expenses.

[[Page 36922]]

    FHWA Response: FHWA believes that an agency's or person's intent 
when acquiring real property is relevant in determining if and how the 
requirements of 49 CFR part 24 apply. The FHWA currently has guidance 
in the form of an FAQ for 49 CFR part 24 as referenced in the NPRM's 
Section-by-Section Discussion of Proposed Changes. The guidance states 
that the funding agency will review the acquisition records and 
consider the relevant facts for the properties acquired by the local 
agencies or third parties 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 is being acquired with the intent of 
incorporating it into a federally assisted project or program and 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. However, 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. However, there are a very limited number of cases where 
an agency can start the process of a voluntary acquisition under Sec.  
24.101(b) before later using eminent domain, such as in the aftermath 
of a major disaster or a presidentially declared national emergency, as 
indicated in Sec.  24.404(b) of this final rule. 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.
    FHWA believes there is not one answer that fits all third-party 
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 
federally assisted projects or programs.
    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 federally assisted 
projects or programs. Establishment of such wetland banks, which may 
include a Federal or federally funded project or program among its 
future users, does not necessarily trigger application of the Uniform 
Act requirements. 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 federally funded or assisted 
project(s) or programs(s), then the property acquisitions for the 
wetland bank must conform to Uniform Act requirements. If an agency 
contracts with a private third-party provider that 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 
Sec.  24.101(b)(1) would apply.
    If the wetland bank has received Section 404 of the Clean Water Act 
(33 U.S.C. 1344) approval, 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 that 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.
    FHWA does not believe that a property for sale on the open market 
before the acquisition began or that an owner intended to sell despite 
the transportation project would automatically make this property 
subject to the voluntary acquisition provisions of this regulation and 
therefore would not require relocation assistance be provided to the 
property owner. As discussed in responses to other comments in this 
section, the applicability of the voluntary acquisition requirements is 
determined primarily by consideration of whether the acquisition of the 
property will be carried out under authority or subject to use of 
eminent domain authority. The fact that the property is listed for sale 
is in almost all cases not a factor that can be used to deny a property 
owner relocation assistance they would otherwise be entitled to 
receive.
    As a result of the above analysis, FHWA deleted the proposed 
Sec. Sec.  24.101(d)(2) and (3) provisions because they were identified 
in comments as confusing and raised questions about applicability and 
purpose. As discussed earlier in this preamble, FHWA revised Sec.  
24.101(b) to address properties acquired in advance and in anticipation 
of a Federal or federally funded project or program and added a 
discussion on wetlands banking to Sec.  24.101(b)(1)(iii), appendix A.

Appendix A, Section 24.102(c)(2) Appraisal, Waiver Thereof, and 
Invitation to Owner

    FHWA received four comments regarding the appendix A explanations 
of waiver valuations. Three of those four comments discussed the term 
``uncomplicated'' while one comment objecting to the idea that waiver 
valuations should have similar unit values to appraisals of similar 
property on the same project.
    FHWA Response: FHWA appreciates the supportive comments about the 
explanation of uncomplicated valuations found in appendix A and 
recognizes that agencies can further define the term in their approved 
procedures and manuals. FHWA does not believe that the final rule 
should further explain or define uncomplicated. agencies and recipients 
should develop procedures and policies where necessary to better 
understand the determination of what qualifies as an uncomplicated 
valuation. FHWA does not believe that a national standard defining an 
uncomplicated valuation should be included in this final rule, as such 
determinations are fact-based determinations based on State law and 
local real estate market practices, which may include determinations of 
what is real property and what is personal property.
    FHWA believes that waiver valuations should reflect the land value 
conclusions of similar properties on a project reflected in appraisal 
reports provided on behalf of the acquiring agency for other properties 
which it will be acquiring for the project. This is fundamental to 
project consistency and uniform treatment of property owners.

[[Page 36923]]

    As a result of the above analysis, no changes were made to appendix 
A.

Section 24.102(c)(2)(ii) Basic Acquisition Policies--Negotiation 
Procedures; Appraisal, Waiver Thereof, and Invitation to Owner

    Thirteen commenters indicated support for increased regulatory 
limits for the waiver valuation. One commenter cautioned against 
increases in the waiver valuation limits suggesting that ``most State 
DOTs are not adequately staffed with talented and trained individuals 
to handle any increase in their program parameters.'' Five commenters 
suggested the different tiers of the waiver valuation limits should be 
tied to inflation. They reasoned that if the limits are not adjusted 
through another rulemaking or regulatory process, the effects of 
inflation would effectively reduce some flexibility this rule seeks to 
provide. Commenters suggested many alternatives including using CPI-U 
as the appropriate index, increasing the limits each year by 2 percent, 
or establishing a schedule to review and adjust the limits every 5 
years to avoid the administrative confusion and burden of having limits 
adjusted annually. Other commenters suggested specific valuation limit 
amounts or suggested valuation limits be established based on local 
market real estate prices.
    FHWA Response: While there was support from some of the commenters 
for raising the waiver valuation limits, there is little uniformity in 
the comments and recommendations other than the references to 
inflationary pressures since the last publication of this rule in 2005 
and the streamlining effect any increase in waiver valuation limits 
would have on land acquisition programs. FHWA believes the appraisal 
waiver requirements have proven to be an effective tool in containing 
costs and in fostering accelerated project delivery which have proven 
to be consistent with the overarching goal of protecting the rights of 
property owners whose property is acquired for a Federal or federally 
assisted project or program. A national survey and various FHWA process 
reviews of State DOT programs confirmed this to be the case.
    In response to comments received, and in consideration of the 
feedback from a recently completed national waiver valuation survey and 
research, FHWA will revise the waiver valuation regulations by making 
four changes, which are changes to the first tier waiver valuation 
limit (Sec.  24.102(c)(2)(ii)), changes to the second tier waiver 
valuation limits (Sec.  24.102(c)(2)(ii)(C)), changes to requirements 
to implement the third tier of the waiver valuation limits (Sec.  
24.102(c)(2)(ii)(D)), and the addition of a process for updating the 
waiver valuation limits in Sec.  24.11. Three of these four changes are 
described in the following paragraphs with the fourth change which 
relates to the third tier of the waiver valuation requirements 
discussed in responses to comments on Sec.  24.102(c)(2)(ii)(D) Basic 
Acquisition Policies; Requirements for use of the Third Tier of Waiver 
Valuation later in this preamble.
    After reviewing and considering comments received during the NPRM 
comment period, FHWA has revised the final rule by increasing the 
waiver valuation limits for the first tier to $15,000, the second tier 
to $35,000, and the third tier limits to allow for properties with an 
uncomplicated valuation problem and fair market value estimate of more 
than $35,000 and up to $50,000.
    FHWA has also revised the final rule to include a process for 
updating of waiver valuation limits in Sec.  24.11. FHWA believes 
including waiver valuation limits adjustment provisions in Sec.  24.11 
will ensure that the effects of inflation do not unnecessarily restrict 
appropriate use of waiver valuations.
    Future determinations on the need for adjustments will be based on 
the CPI-U, which includes a measure of the average change in the 
consumer prices for a fixed market basket of goods and services that 
includes costs of shelter. The CPI-U considers the cost of shelter for 
renter-occupied housing. For an owner-occupied unit, the cost of 
shelter is the rent that owner-occupants would have to pay if they were 
renting their homes. Because market rent is a function of, and linked 
to market value, FHWA believes use of CPI-U is appropriate for this 
adjustment. FHWA does not believe that adjustments based on local 
market conditions are appropriate. FHWA believes that a single national 
standard ensures equitable treatment for those whose real property 
rights are acquired and reduces opportunities for confusion in 
understanding and applying the appropriate waiver valuation limits. 
FHWA also notes that such a scheme would likely create administrative 
burden which would outweigh any programmatic benefits that might be 
achieved.

Section 24.102(c)(2)(ii) Basic Acquisition Policies; Competency 
Requirement

    Two commenters indicated support for the language that clarifies 
that the agency employee or contractor making the determination to use 
the waiver valuation option must understand valuation principles, 
techniques, and use of appraisals in order to be able to determine 
whether the proposed valuation is uncomplicated. One commenter 
suggested that more definitive decision-making processes be developed 
for waiver valuations.
    FHWA Response: FHWA believes it is important to emphasize that the 
person making the determination of whether the waiver valuation is the 
appropriate valuation tool to develop and report an amount believed to 
be just compensation must themselves have sufficient understanding of 
the local markets; knowledge of appraisal principles; and the proper 
use of valuation methodologies to be able to determine whether the 
valuation problem is uncomplicated and whether the use of a waiver 
valuation would be appropriate. FHWA will consider developing an FAQ to 
clarify that waiver valuations follow a multi-step decision-making 
process emphasizing that it must be apparent the valuation problem is 
uncomplicated, and that the compensation limits for the waiver 
valuation cannot be exceeded.
    As a result of the above analysis, FHWA replaced the reference to 
employee or contractor with ``representative'' to clarify that 
responsibility to ensure competency in the administration of the waiver 
valuation program remains the agency's responsibility, regardless of 
the title of the person making the valuation assignment.

Section 24.102(c)(2)(ii)(A) Basic Acquisition Policies; Uniform Act and 
USPAP Compliance

    FHWA received ten comments related to the interrelationship between 
the Uniform Act regulations and the USPAP with a wide diversity of 
opinions about how licensed and certified appraisers can perform waiver 
valuations and appraisals while remaining compliant with both the USPAP 
and the regulation. At least one comment acknowledged that more 
clarification is needed.
    FHWA Response: FHWA understands that licensed and certified 
appraisers continued to perceive a conflict between the requirements of 
the regulatory provisions and USPAP standards, and FHWA addressed most 
of those concerns with the modifications to the regulation discussed 
under the definitions of appraisal and waiver valuation. These concerns 
primarily focus on an appraiser's need to comply with USPAP licensure 
standards while

[[Page 36924]]

simultaneously meeting the requirements of this rule. One remaining 
conflict for license holders is that USPAP recognizes performing 
valuation assignments involves two separate functions: (1) development 
of a valuation, appraisal, or appraisal review, and (2) reporting the 
results of a valuation, appraisal, or appraisal review to clients, and 
intended users of valuation services. By comparison, the regulation has 
traditionally viewed the terms developing and reporting when used in 
reference to valuations, appraisals, and appraisal reviews, as meaning 
the same thing. To address this conflict, FHWA revised Subpart B by 
replacing the word ``develop(ed)'' with the word ``perform(ed)'' when 
referring to waiver valuations, appraisals, or appraisal reviews to 
avoid confusion with long standing interpretations in the USPAP. The 
intent of this change is to ensure that readers of this regulation 
understand that performance of a valuation, appraisal, or appraisal 
review includes both development of the assignment results and 
reporting those results to the client and intended users of the 
product. This modification will provide clarity regarding the 
interrelationship and applicability of Uniform Act requirements to 
USPAP.

Section 24.102(c)(2)(ii)(A) Basic Acquisition Policies; Jurisdictional 
Exception Language and USPAP Compliance

    FHWA received six comments related to the proposed Jurisdictional 
Exception language which states that licensed or certified appraisers 
preparing or reviewing a waiver valuation are precluded from complying 
with Standards Rules 1, 2, 3, and 4 of the USPAP, as promulgated by the 
Appraisal Standards Board of The Appraisal Foundation.\2\ Four 
commenters indicated support for the language, while two commenters 
opposed the proposed language, with one commenter suggesting that the 
Jurisdictional Exception language in USPAP was never intended to be 
used in this manner. The second commenter opposed the jurisdictional 
exceptions indicating that the proposed language is likely to have 
unintended negative consequences.
---------------------------------------------------------------------------

    \2\ https://www.appraisalfoundation.org/imis/TAF/Standards/Appraisal_Standards/TAF/Standards.aspx.
---------------------------------------------------------------------------

    FHWA Response: FHWA believes performing appraisals when a waiver 
valuation would be sufficient can cause unnecessary delay, add 
unnecessary cost to an acquisition, and deliver no appreciable benefit 
to the property owner. FHWA notes that the final rule's revised 
definition of a waiver valuation and the language precluding compliance 
with Standard Rules 1, 2, 3, and 4 of USPAP will allow a licensed or 
certified appraiser to perform or review a waiver valuation which, by 
definition in this rule, is not an appraisal. One ongoing concern that 
has been raised over the years is that those with an appraisal license 
or appraisal certification are unsure how to meet seemingly different 
requirements of USPAP and the Uniform Act.
    As a result of the above analysis, FHWA has revised the definition 
of ``waiver valuation'' in Sec.  24.2(a) to clarify that waiver 
valuations are not appraisals. The language precluding compliance was 
added to Sec.  24.102(c)(2)(ii)(A) to provide appraisers with the clear 
language necessary to remove any confusion with regard to violation of 
professional standards and State licensure requirements when an 
appraiser complies with the Jurisdictional Exception requirements. The 
severability clause in USPAP's Jurisdictional Exception Rule allows the 
appraisers' obligation to comply with the rest of USPAP to remain 
intact, including the requirements to be competent, ethical, and to not 
produce misleading reports. FHWA believes the final rule language will 
provide States, and licensed or certified appraisers, with clarity 
about the requirements of this regulation, and the implications of 
performing a waiver valuation. FHWA recognizes that while a formal 
review of a waiver valuation is not required by the regulation, some 
agencies may adopt a formal review of waiver valuations as part of 
their quality control process. In those instances, the final rule will 
also provide clarity to licensed or certified appraisers regarding 
their obligations to comply with USPAP under the Jurisdictional 
Exception language while performing a waiver valuation review 
assignment. FHWA will also develop FAQs to demonstrate how appraisers 
may comply with USPAP's Jurisdictional Exception Rule while performing 
this type of assignment.
    As a result of the comments received, FHWA will also change the 
term ``licensed or certified appraisers'' to ``persons'' when 
describing the requirements for performing waiver valuations to clarify 
that the final rule's requirements apply to all who perform waiver 
valuations.

Section 24.102(c)(2)(ii)(B) Basic Acquisition Policies; Minimum 
Qualifications of Waiver Valuation Preparer

    FHWA received two comments on minimum qualifications of a waiver 
valuation preparer. One commenter indicated a desire for language that 
clarifies that a highly regulated State agency can approve persons 
performing waiver valuations. Another commenter recommended that all 
persons performing waiver valuations receive basic training in 
appraisal principles.
    FHWA Response: FHWA believes that Federal agencies, States, and 
other recipients can continue to make necessary policy determinations 
on the most effective methods for training and qualifying those 
performing waiver valuations.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.102(c)(2)(ii)(D) Basic Acquisition Policies; Requirements 
for Use of the Third Tier of Waiver Valuation

    FHWA received 12 comments related to the proposed requirements for 
the new third tier of the waiver valuation. Eleven comments voiced 
concerns about the requirements proposed for this tier. One comment was 
supportive of the proposed requirements but suggested that the 
requirement for quarterly reports be changed to milestone reports in 
the right-of-way phase of the project. Of the 11 comments that voiced 
concerns about the requirements for use of this tier, 4 of those 
commenters did not support limiting this tier's use only to Federal 
agencies and their recipients, suggesting that subrecipients should 
also be allowed to use this tier. Two comments were in favor of not 
allowing subrecipients to use this tier. Five comments were received 
that indicated complying with the six requirements for Federal agency 
approval to use the third tier would be overly burdensome.
    FHWA Response: FHWA believes a primary purpose of the Uniform Act 
is to ensure that just compensation offers are provided to property 
owners fairly, timely, and efficiently. After considering the 
commenters' concerns of administrative burden created by the NPRM's 
proposed requirements for use of the third tier of waiver valuations, 
FHWA revised the final rule requirements for use of the third tier of 
waiver valuations by eliminating the documenting and reporting of names 
or credentials of individuals who will be performing the waiver 
valuations; eliminating the administrative/

[[Page 36925]]

managerial oversight mechanisms used to assure proper use and review of 
this additional level of authority; eliminating the development and use 
of the quality control procedures to be utilized; and revising the 
reporting requirements.
    As noted in the response to comments pertaining to Sec.  
24.102(c)(2)(ii) Basic Negotiation Procedures; Appraisal, Waiver 
Thereof, and Invitation to Owner'' and in this part seeking to increase 
the limits for the third tier waiver valuations, the final rule 
includes a revised third tier of the waiver valuations which includes 
properties with an estimated compensation amount of more than $35,000 
and up to $50,000.
    FHWA agrees with several commenters that some of the requirements 
related to reporting could be revised by streamlining or eliminating 
some of the requirements. FHWA revised the reporting requirement to 
require that within 6 months of completion of acquisition activities, 
the agency must submit a close-out report measuring cost/time benefits; 
condemnation rate; settlement rate; and any other relevant metric which 
can document both the administrative savings, and accuracy and efficacy 
of the waiver valuations.
    FHWA acknowledges that recipient agencies continue to have 
oversight responsibilities with their subrecipient agencies and can 
best provide oversight and stewardship of those subrecipient agencies. 
The FHWA agrees with several commenters that limiting the use of the 
third tier waiver to Federal agencies and their recipients may be 
unnecessarily restrictive and eliminated the proposed requirements 
limiting the use of the third tier of waiver valuations to Federal 
funding agencies and recipients. Therefore, recipient agencies should 
consider developing policies for allowing the use of the third tier 
waiver valuations by subrecipients.

Section 24.102(c)(2)(ii)(E) Basic Acquisition Policies; Requirements 
for Agencies To Offer Property Owners the Option To Have the Agency 
Provide Appraisals Instead of Waiver Valuations

    One commenter indicated that the regulatory language as proposed 
may have caused an unintended consequence. They noted that Sec.  
24.102(c)(2)(ii)(E) is a subsection of Sec.  24.102(c)(2)(ii), which 
authorizes the agency to determine that an appraisal is unnecessary for 
acquisitions under $10,000. The commenter noted that it appears that 
Sec.  24.102(c)(2)(ii)(E), as proposed, would require the agency to 
perform an appraisal in all instances where an owner elects to have the 
property appraised, including acquisitions under $10,000.
    FHWA Response: FHWA agrees that the requirement to perform an 
appraisal when requested by the property owner does not apply to waiver 
valuations for acquisitions under the limit specified in Sec.  
24.102(c)(2)(ii), which is raised in the final rule to $15,000. FHWA 
acknowledges that the structure and organization of the paragraphs was 
unclear and has modified the language in this final rule to clarify 
that Sec.  24.102(c)(2)(ii)(E) applies only to Sec. Sec.  
24.102(c)(2)(ii)(C) and (D).

Section 24.102(f) Basic Negotiation Procedures; Appendix A, Minimum 
Negotiation Period

    One commenter requested FHWA strengthen the statement in appendix 
A, Sec.  24.102(f), regarding the 30-day minimum negotiation period to 
find a balance between fairness and project delivery in the acquisition 
phase.
    FHWA Response: FHWA believes the current language is sufficient in 
that it addresses a need to ensure fairness in allowing the property 
owner a reasonable amount of time to consider the agency's offer 
regardless of project delivery pressures. The current appendix A 
language allows that the time needed to consider an offer can vary 
significantly depending on the circumstances but that 30 days would 
seem to be the minimum time these actions can be reasonably expected to 
require. It also notes that regardless of project time pressures, 
property owners must be afforded this opportunity. (appendix A, Sec.  
24.102(f)). The current language also makes it permissible to complete 
negotiations in less than 30 days if the parties can reach an 
agreement. FHWA believes that it is important to note that this 
requirement is not satisfied by simply establishing a minimum or 
maximum number of days for a negotiation process. Instead, it is 
focused on developing policies and practices necessary to ensure that 
an agency does not cause those whose property is being acquired to 
suffer an undue burden or to be treated in a manner that is coercive in 
nature.
    As a result of the above analysis, no changes were made to this 
section or appendix A of the final rule.

Section 24.102(g) and (i)--Updating Offer of Just Compensation & 
Administrative Settlements

    One commenter described a court case related to a State's use of 
its administrative revision process and requested guidance on the 
proper use of administrative revisions and when they are appropriate.
    FHWA Response: FHWA declines to comment on ongoing State court 
litigation but notes the underlying and applicable Uniform Act 
requirement for good faith negotiations, the provisions on revising 
appraisals, and making an administrative settlement. Section 24.102(f) 
requires that a property owner be given a reasonable opportunity to 
consider the agency's offer and to present relevant material which they 
believe provides a basis for a change or update in the agency's offer 
of the amount believed to be just compensation and offer to purchase. 
Agencies must update their waiver valuations and appraisals and, when 
necessary, obtain a new appraisal or waiver valuation if new or 
relevant information on the real property's value is presented by the 
owner, a material change in the character or condition of the property 
occurred, or a significant delay has occurred since the time of the 
appraisal or waiver valuation was developed. If the updated or new 
appraisal or waiver valuation information indicates that a change in 
the value of real property being acquired, the agency shall promptly 
revise its offer of the amount believed to be just compensation and 
make that offer to the owner in writing (Sec.  24.102(g)). Section 
24.102(i) of this final rule continues to permit use of an 
administrative settlement as a means to reach a negotiated settlement 
when possible. The use of an administrative settlement is consistent 
with the Uniform Act (42 U.S.C. 4651), which has an underlying goal of 
encouraging and expediting the acquisition of real property by reaching 
agreements with owners, avoiding litigation, assuring consistent 
treatment for owners and to promoting public confidence in Federal land 
acquisition practices.
    In addition, appendix A section 24.102(i) advises that appraisers, 
including review appraisers, must not be pressured to adjust or revise 
their opinions of value and recommendations (or approvals) of the 
amount believed to be just compensation for the purpose of justifying 
such administrative settlements.
    As a result of the above analysis, no changes were made to the 
final rule.

Section 24.102(j)--Payment Before Taking Possession

    One commenter suggested a language change to clarify what is 
intended by ``shall pay'' at Sec.  24.102(j).
    FHWA Response: FHWA reviewed the relevant regulations and believes 
the current regulations accurately list the

[[Page 36926]]

different ways payment can be made to a property owner depending on the 
circumstances. FHWA believes the appropriate language for negotiated 
agreement is the agency ``shall pay'' the agreed purchase price to the 
owner. In the case of condemnation, in contrast, the agency ``makes the 
funds available'' for the benefit of the owner, by depositing with the 
court an amount not less than the approved fair market value. In 
addition, FHWA notes that the use of the word ``pay'' in this 
regulation is consistent with the description found in section 4651(4) 
of the Uniform Act, which states that no owner shall be required to 
surrender possession of real property before the head of the Federal 
agency concerned pays the agreed purchase price, or deposits with the 
court, for the benefit of the owner, an amount not less than the 
agency's approved appraisal of the fair market value of such property, 
or the amount of the award of compensation in the condemnation 
proceeding for such property (for additional Federal condemnation see 
also Sec. Sec.  3114(a) through (d) of Title 40). FHWA does not believe 
that making the agreed purchase price available to the owner as opposed 
to paying the owner are synonymous and believes that that ``paying'' 
more accurately describes this requirement.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.102(n) Conflict of Interest

    FHWA received four comments on the NPRM's proposed changes to the 
conflict of interest requirements. One commenter indicated a desire for 
clearer explanation of the difference between conflict of interest 
provisions for acquisitions of $10,000 and below, and acquisitions from 
$10,001 to $25,000. Another commenter recommended that the final rule 
increase the previous rule's limit for conflict of interest from 
$10,000 to $15,000 and eliminate the NPRM's proposed second tier 
because the requirements are too complicated and would not be used. A 
third commenter suggested the existing limits be increased to account 
for inflation and to eliminate the proposed requirements for the second 
tier as they would increase administrative costs and slow down project 
delivery. A fourth commenter suggested increasing the existing limits 
to $25,000 and eliminating the proposed additional requirements for the 
sake of simplicity.
    FHWA Response: The FHWA's experience is that the conflict of 
interest limit has been managed effectively and that protections for 
property owners' rights have not been diminished by this process. In 
recognition of that experience and in response to comments on this 
part, FHWA revised this final rule to increase the upper limit of the 
first tier of the conflict of interest provision to $15,000 and the 
second tier to $35,000. FHWA believes increasing the limits of the 
second tier of the conflict of interest provision to $35,000 to 
coincide with the new second tier limits of the waiver valuation in 
Sec.  24.102(c)(2)(ii), offers agencies opportunities for single agent 
activities that can be performed in a way that encourages efficient 
results, and does not unnecessarily burden them with administrative 
costs. Use of this tier will continue to require an appraisal, and 
review of the appraisal, if the valuation preparer is also acting as 
the negotiator.
    These changes will align the conflict of interest limits with the 
increased limits of both the first tier of the waiver valuation in this 
final rule at Sec.  24.102(c)(2)(ii), and the second tier of the waiver 
valuation at Sec.  24.102(c)(2)(ii)(C).
    FHWA believes that additional requirements for use of the second 
tier of the conflict of interest provision are prudent and necessary to 
minimize opportunities for waste, fraud, and abuse. FHWA revised this 
section for clarity by moving the discussion on providing approval for 
use of conflict of interest provisions to subrecipients to Sec.  
24.102(n)(4). FHWA also revised appendix A to Sec.  24.102(n)(2) to 
include mention of prohibitions against negotiators supervising the 
persons performing waiver valuation.

Section 24.103 (a) Criteria for Appraisals

    FHWA received four comments on criteria for appraisals. Three 
commenters indicated a desire for language that more strongly 
emphasized the importance of the Uniform Appraisal Standards for 
Federal Land Acquisition (UASFLA). One commenter recommended that FHWA 
update all USPAP references to the 2020-2021 version of USPAP.
    FHWA Response: FHWA believes the appraisal standards outlined in 
the UASFLA continue to be suitable for Federal and federally assisted 
projects and programs. The recognition of USPAP as an appraisal 
standard in the 2005 version of these regulations was not intended to 
diminish the UASFLA's importance but instead to ensure that it is 
understood that licensed and certified appraisers could comply with 
these regulations, and to the extent appropriate, the UASFLA, while 
still complying with their State's appraisal licensing requirements 
under USPAP. FHWA is aware that the final rule language modification in 
2005 was seen by some appraisers performing assignments for Federal 
agencies to indicate that compliance with the UASFLA was not required 
because the language was interpreted to mean that compliance with USPAP 
alone was sufficient. FHWA may develop FAQs to emphasize and clarify 
that non-compliance with UASFLA standards is neither required nor 
suggested by this rule. The FAQs would offer clarity regarding the 
importance for appraisers to understand their obligation for competency 
in the jurisdictional area they are working.
    As a result of this analysis, no changes were made to this section 
of the final rule.

Section 24.104(a) Review of Appraisal

    FHWA received two comments on the review of appraisal. One 
commenter indicated that since appraisal review was not identified 
specifically in the law, it should be eliminated from the regulation to 
save time and costs to the acquiring agency, or alternatively, that 
appraisal review only be imposed upon all appraisals that estimated 
compensation above $250,000. One commenter thought that the acquiring 
agency should be allowed to determine when an appraisal review should 
be required.
    FHWA Response: FHWA notes that the previous final rules also 
recognized a need for appraisal review and its important role in 
ensuring agencies provide just compensation. The 2005 final rule 
preamble, 70 FR 599 (January 4, 2005), noted that FHWA does not believe 
that it has flexibility under the Uniform Act to make appraisal review 
optional. The discussion described the Uniform Act's requirement for an 
approved appraisal, which FHWA interprets and implements as requiring a 
technically reviewed appraisal. The discussion also noted that while 
the Uniform Act specifically grants authority for waiver of the 
appraisal, it does not do so for approving an appraisal and that for 
over 30 years, the regulation has been consistent in the description 
and requirements for this function.
    FHWA continues to believe that the appraisal review function's 
primary purpose is to serve as a necessary quality control tool. The 
appraisal review requirement is not a requirement to perform a second 
appraisal, or in some other way duplicate the effort and work necessary 
to perform and report an opinion of value.
    The appraisal review requirement ensures that agency officials 
charged

[[Page 36927]]

with approving amounts believed to be just compensation have reliable, 
relevant, and consistent information which is necessary to approve an 
amount believed to be just compensation, and when necessary, in 
approving administrative settlements. The appraisal review process also 
ensures that opinions of value are appropriately supported and meet 
agency requirements, and that offers to property owners are based on 
coherent and consistent land values. The appraisal review process also 
ensures that appraisals are competently scoped, developed, and 
documented.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Subpart C--General Relocation Requirements

Section 24.202(a) Persons Required To Move Temporarily

    FHWA received 13 comments with suggested changes and general 
support for the proposed temporary relocation reorganization and 
clarification. The comments were grouped below into smaller 
subcategories in order to provide succinct responses to each of the 
comments received.

Section 24.202(a) Persons Required To Move Temporarily--Temporary 
Displacement vs. Permanent Displacement

    Two comments supported the proposed addition and use of ``persons 
required to move temporarily.'' One commenter suggested that the term 
``temporarily displaced'' be replaced with ``temporarily relocated.'' 
Two commenters asked for clarification on the NPRM's proposal to add a 
new Sec.  24.202(a), ``Persons temporarily displaced,'' which they felt 
needed to be revised because they interpreted the rule to say that a 
person required to move temporarily is not displaced and therefore not 
eligible for assistance under this rule. One commenter suggested 
revising the title of the section to clarify applicability of the 
requirements, while another commenter requested examples be added to 
aid in determining who is temporarily displaced. One commenter 
expressed concern that the NPRM's proposed changes and addition of 
regulatory requirements for persons who are temporarily displaced 
create deep structural disconnects between Uniform Act terms and 
requirements and conditions that housing authorities and others working 
within affordable housing programs and other similar programs 
encounter. The commenter expressed concern that the NPRM also fails to 
recognize the overlapping regulatory and contractual requirements of 
owners of properties assisted by the Federal loan and subsidy programs 
to provide notices and avoid displacement that exist outside of the 
Uniform Act.
    FHWA Response: FHWA revised the final rule to consistently use the 
term ``persons required to move temporarily'' to ensure that there is 
clarity and consistency in describing the benefits and assistance that 
would be provided to those who are temporarily displaced.
    FHWA considered the request to include examples of persons required 
to move temporarily in this rule. FHWA believes that the definition of 
``displaced person'' provides agencies with the factors used in 
determining when a person is permanently displaced. To ensure that 
there is a clear distinction between ``displaced person'' and ``persons 
required to move temporarily'', FHWA added the word ``permanently'' to 
the definition of ``displaced person'' in Sec.  24.2 to more clearly 
describe those who are permanently displaced. This same definition has 
separate provisions that can be applied when a person is required to 
either temporarily discontinue the use of their property or to move 
temporarily from their property. FHWA understands that some of the 
activities that may require a person to move temporarily or to 
temporarily discontinue the use of their property are either unique, 
episodic, or in some other fashion impose temporary limits on the use 
of real property. FHWA has added language in Sec. Sec.  24.202 through 
24.204 to more clearly indicate which requirements apply to those who 
are temporarily displaced. Because temporary relocations can be 
episodic or unique in nature, FHWA has also added language which 
clarifies when certain actions require determinations of applicability 
by the funding agency. The FHWA believes that Federal funding agencies 
can develop policies or guidance which may assist it and its recipients 
in making a determination of when their Federal and federally assisted 
projects or programs cause persons to move temporarily or to 
temporarily discontinue use of their property.
    FHWA considered the proposed use of the term temporarily 
``relocated'' in place of temporarily ``displaced.'' In reviewing the 
proposed addition of requirements for those who are required to move 
temporarily or to temporarily discontinue the use of their real 
property FHWA notes that the definition of displaced person now 
includes a subsection which addresses those required to move 
temporarily.
    As a result of the above analysis, FHWA has revised the final rule 
by adding a definition in Sec.  24.2(a)(ii) to discern the differences 
between those permanently displaced and those required to move 
temporarily and by revising the requirements in Sec.  24.202 to explain 
what benefits and assistance are provided to persons required to move 
temporarily.
    The final rule also includes a section describing moving costs and 
allows for storage for persons required to move temporarily with 
Federal agency approval.
    FHWA believes the final rule's requirements for persons required to 
move temporarily, the discussion and clarification about development of 
funding agency specific policies, and the revision of the title of the 
notice at Sec.  24.203(b) ensure that those carrying out relocations 
have the tools necessary to correctly implement the funding agency's 
program in compliance with Uniform Act requirements. As noted in the 
NPRM's preamble at 84 FR 69476, FHWA believes this change aligns the 
regulation more closely with the language and requirements of Section 
4621 of the Uniform Act. These requirements include a recognition that 
assistance policies must provide for fair, uniform, and equitable 
treatment of all affected persons. In addition, FHWA believes that 
providing services and assistance to persons required to move 
temporarily is necessary to minimize the impacts of displacement and to 
maintain the economic and social well-being of communities.
    FHWA will consider development of FAQs describing requirements for 
persons required to move temporarily under the final rule.

Section 24.202(a) Persons Required To Move Temporarily--Payment for 
Temporarily Closing of a Business

    Two commenters noted some businesses that might temporarily 
discontinue use of their property would not qualify for assistance 
because a business might only be eligible for payment of expenses when 
a person's business is required to move temporarily due to 
rehabilitation of a site. These same commenters suggested the final 
rule should be revised to ensure that businesses required to move 
temporarily for reasons other than rehabilitation of a site be eligible 
for temporary relocation benefits as well. One commenter requested 
clarification in the final rule focused on temporary business 
displacement. This commenter suggested allowing payment to

[[Page 36928]]

businesses to compensate the business for temporarily closing instead 
of moving temporarily. The proposed payment would be determined by 
using average daily income. The commenter reasoned that the proposed 
payment would allow the business to remain in place but closed for 
business until the project or program activity is completed.
    FHWA Response: FHWA believes that this regulation does not contain 
language that would limit eligibility for temporary nonresidential 
moves to when the temporary displacement was caused by rehabilitation. 
The NPRM's preamble discussion of proposed changes to the definition of 
displaced person addresses eligibility for those who are required to 
move temporarily.
    The preamble discussion at 84 FR 69476 noted that several Federal 
agencies have programs or projects that do not require the acquisition 
of real property, but instead may require the rehabilitation or 
demolition of real property, and that FHWA proposed adding the terms 
``rehabilitate or demolish'' to the definition of a displaced person. 
The addition would clarify that the term ``displaced person'' includes 
those required to move, or move their personal property, or who are 
required to temporarily move from or to temporarily discontinue use of 
their real property as a result of a written notice of intent to 
rehabilitate or demolish, even if the real property is not being 
acquired. The final rule adopts the NPRM proposals addressing 
businesses that are required to move temporarily at Sec.  24.202(a).
    The term ``displaced person'' is used in the Uniform Act to 
describe persons who move permanently because of a Federal or federally 
assisted project or program. ``Persons not displaced'' is a term used 
to describe persons who do not qualify for Uniform Act benefits. FHWA 
revised and reorganized the definition to specifically address persons 
who are required to move temporarily and included a new addition in the 
final rule, Sec.  24.202(a), to describe the required assistance and 
services that must be made available for persons who are required to 
move temporarily. FHWA notes that the final rule will continue to 
include a notice of intent to rehabilitate or demolish but does not 
agree or believe that the notice would restrict eligibility for those 
required to move temporarily to only residential occupants.
    FHWA considered the comments on allowing a business owner to decide 
to claim a payment for temporary closure of a business in lieu of 
temporary relocation and does not agree that such a payment should be 
allowed. Such a payment is specifically disallowed under the current 
regulations in Sec.  24.301(h), Loss of profits, and FHWA sees no 
rationale for allowing such a payment to a business required to move 
temporarily. FHWA also believes that determination of a temporary loss 
of business payment due to temporary closure of a business raises 
questions about calculation methodology. Several considerations would 
make such a determination and calculation imprecise, unworkable, and 
impractical to document including uncertainty about determining if 
businesses' customers would all return after the temporary closure, 
calculation of temporary loss of temporary loss of goodwill, and 
whether such payments would be available to all businesses required to 
move temporarily or only certain types of businesses that have 
machinery and equipment requiring substantial costs to move and 
reinstall.
    FHWA recognizes that a temporary move and a return to the site may 
not be practical or possible for some businesses for several reasons, 
including, but not limited to, prohibitive costs to move and equipment 
that cannot be relocated temporarily due to cost or specific 
requirements related to installation (including the need for new pits, 
pads, utility service requirements, modifications necessary due to code 
requirements, etc.). The FHWA believes that, in these instances, 
displacing agencies will need to make a fact determination and document 
the reasons why a temporary displacement may not be possible for a 
business and determine that instead, such a business should be provided 
relocation assistance to permanently relocate the business.
    FHWA similarly does not agree that a business required to move 
temporarily for reasons other than rehabilitation of a site would be 
ineligible as defined in this rule. Such an eligibility determination 
would be a fact-based determination which would consider the project's 
impacts on the business in making an eligibility determination.
    As a result of the above analysis, no change was made to this 
section of the final rule.

Section 24.202(a) Persons Required To Move Temporarily--12 Month Time 
Limit

    Two commenters raised concerns about the 12-month time limit for 
temporary relocations. Both commenters were concerned that some 
projects might require a temporary relocation longer than 12 months. 
One commenter reasoned that Sec.  24.207(f) would prohibit an occupant 
from agreeing to a temporary relocation of longer than 12 months.
    FHWA Response: The FHWA considered the comments raising concerns 
that some projects may require a temporary relocation for a period of 
more than 12 months. The commenters raised additional concerns that the 
language in the proposed rule might be interpreted to prohibit a 
displaced person from agreeing to a temporary relocation longer than 12 
months after being informed of their eligibility as a displaced person. 
FHWA agrees that projects often experience unexpected delays for a 
number of reasons. Given the longstanding regulatory flexibility, 
history, and application, FHWA does not agree that the requirements in 
Sec.  24.207(f) would prohibit an occupant from agreeing to a temporary 
relocation of longer than 12 months after being informed of their 
eligibility as a displaced person. The 2005 final rule preamble 
discussion of Sec.  24.2(a)(9)(ii)(D) Temporary Relocation, 70 FR 592 
(January 4, 2005), provided details on how and why a temporarily 
displaced person may elect to continue to be temporarily displaced. The 
rule reasoned that ``Such tenants may be given the opportunity to 
choose to continue to remain temporarily relocated for an agreed to 
period (based on new information about when they can return to the 
displacement unit), choose to permanently relocate to the unit which 
has been their temporary unit, and/or choose to permanently relocate 
elsewhere with Uniform Act assistance.'' FHWA continues to believe that 
when a person who is required to move temporarily, or temporarily 
discontinue use of their property, is fully informed about their 
eligibilities, that they may make a choice which can include to remain 
temporarily displaced for more than a 12-month time period. This choice 
must be documented by having the person required to move temporarily, 
or to temporarily discontinue use of their property, sign a written 
agreement documenting their intent to elect to remain temporarily 
displaced while they wait for the project to conclude.
    Appendix A, Sec.  24.207(f) also addresses the commenters' concern 
that a person required to move temporarily could not agree to remain 
classified as a ``person required to move temporarily'' for more than 
12 months after being informed of their eligibility as a displaced 
person. The appendix A discussion points out that while the regulation 
prohibits an agency from proposing or requesting that a displaced 
person waive their rights or entitlements

[[Page 36929]]

to relocation assistance and payments, an 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 in anticipation of returning to their dwelling or a 
similar dwelling in the building when the project is completed. The 
written statement must clearly document that the individual knows which 
benefits and assistance they are entitled to receive, a copy of the 
Notice of Eligibility that 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.
    The 2005 final rule allows waiver of regulatory requirements when 
that waiver does not reduce benefits or assistance otherwise available 
to an owner or displaced person. This provision, found at 49 CFR 24.7, 
has been a part of the Uniform Act regulation for almost 40 years. The 
1989 final rule preamble at 54 FR 8917 (March 2, 1989); section 24.7 
Federal agency Waiver of Regulations, noted that requirements imposed 
by the Uniform Act may, necessarily, create some delay and 
administrative burden and that it would be inappropriate to grant a 
waiver based on the general proposition of delay and administrative 
burden. A waiver proposal would need to be specific, protect the rights 
of owners and displaced persons, and not be designed to provide 
administrative relief to the acquiring agency. The 1989 preamble also 
noted that the waiver provision, in turn, is explicit regarding two 
major considerations. The first is that the Federal agency, before 
waiving any requirement, must determine that the waiver does not reduce 
any assistance or protection provided to an owner or displaced person 
under this regulation. The second is that any request for a waiver 
shall be justified on a case-by-case basis. FHWA noted in this passage 
that it does not interpret case-by-case to mean, necessarily, a parcel-
by-parcel basis, neither does it encompass the waiver of a requirement 
on a program-wide scope, and therefore the broader the scope of the 
waiver, the more carefully the Federal agency must weigh its effect on 
the assistance and protection to be provided an owner or displaced 
person. This final rule does not propose changes to the Sec.  24.7 
waiver provisions or any changes in interpretation and application of 
the wavier of regulations.
    Federal agencies should develop policies for determining when a 
waiver of the 12-month requirements may be allowed. FHWA notes that 
previous regulatory preambles also addressed the question of whether a 
waiver of regulations in Sec.  24.7 allows for project- or program-
based waiver of regulations by the funding agency. FHWA continues to 
believe that Federal funding agencies considering approving a waiver of 
regulations must ensure that any waiver of regulations does not reduce 
any benefits or assistance due to displaced owners and tenants. FHWA 
believes that Federal funding agencies may grant approval to allow a 
waiver of the 12-month requirement on a project by project basis. Such 
a waiver would need to establish the new maximum duration for requiring 
a person to move temporarily and be approved by the funding agency 
prior to initiation of the project because each person who is or will 
be required to move temporarily, or temporarily discontinue use of 
their property, and must be informed of their eligibilities and 
entitlements. To the extent practicable, agencies should consider the 
need for a waiver of the 12-month requirement in advance of the 
project's initiation. This must include documentation of why the waiver 
is necessary and why a waiver would not reduce required benefits or 
assistance. In some cases, the need to extend temporary relocation 
beyond 12 months will not be foreseeable at the initiation of the 
project but will become apparent at some later stage of the project. In 
such instances, agencies are not required to request a Sec.  24.7 
waiver, if the agency fully informs the temporarily displaced persons 
of their eligibility as a permanently displaced person before giving 
them the option of continuing in a temporarily displaced status. If 
that option is selected, it should be memorialized in a written 
agreement between the agency and the temporarily displaced person.
    Given the history and longstanding interpretation of the waiver of 
regulations provisions, FHWA does not believe that additional 
regulatory changes are necessary and that agencies can develop further 
policy and procedures that describe safeguards necessary to ensure that 
displaced persons are provided all eligibilities and assistance 
required under this rule. Such policies and procedures should include 
consideration of what the agency believes to be the maximum duration 
that a person can required to remain a person required to move 
temporarily and when such waivers may and may not be granted.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.202(a) Persons Required To Move Temporarily--Requirement for 
Notices

    One commenter raised a question about notice requirements for those 
who are required to move temporarily, or to temporarily discontinue use 
of their property, and specifically asked about the applicability of 
the 90-day notice requirement for those required to move temporarily or 
to temporarily discontinue use of their property.
    FHWA Response: FHWA considered the commenter's questions about 
notices for persons who are required to move temporarily or to 
temporarily discontinue use of their property. The final rule includes 
specific eligibilities in Sec.  24.202(a) for persons required to move 
temporarily as proposed in the NPRM, which include notice requirements.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.202(a) Persons Required To Move Temporarily--Advisory 
Services

    Two commenters raised a question about meeting the requirements for 
providing advisory services to persons required to move temporarily.
    FHWA Response: FHWA believes that the requirements of Sec.  
24.205(c) provide detailed requirements for advisory services for those 
displaced are applicable in part to those persons required to move 
temporarily. However, the primary purpose of advisory services is to 
ensure that a displaced person is fully informed about the assistance 
and benefits that may be available to them. Such advisory services 
necessarily require an agency to develop and maintain ongoing 
communication with a person required to move temporarily. Such 
communication will ensure that the agency understands the needs of the 
person required to move temporarily and addresses those needs as 
required and allowed in this rule.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.203 Relocation Notices

    FHWA received responses from two commenters on relocation notices. 
One commenter asked that the final rule clarify when and how notice 
requirements in this rule should be applied to Federal rental housing 
programs. This commenter pointed out that some programs do not have a 
readily identifiable initiation of negotiations. One commenter 
suggested the elimination of the notice of intent to

[[Page 36930]]

acquire, rehabilitate, or demolish, and reasoned that the General 
Information Notice already serves the same purpose; and also asked that 
the final rule include a discussion of timing for the various notices. 
This commenter reasoned that the NPRM contains a description of 
notices, which do not always clearly fit into Federal agency 
acquisition and relocation processes, and which are sometimes 
dissimilar to what is described in the final rule. One commenter 
suggested that Federal funding agencies ensure that notices are written 
in easily understood terms and organized in a way to ensure that 
displaced persons or occupants are provided with information they need 
in as basic a manner as possible.
    FHWA Response: The requirement for notices is one of the most 
basic, but also one of the most important, requirements in this rule. 
Notices serve to ensure that those impacted by a Federal or federally 
assisted project or program receive information and assistance that 
they will need to successfully relocate.
    FHWA understands the concerns about how some of the requirements 
are not easily applied to all Federal programs but does not believe 
that changes to the final rule can adequately address concerns that are 
specific to each Federal agency's program. FHWA believes agencies 
should develop policies and guidance to clarify how requirements in 
this rule are implemented, as necessary.
    FHWA agrees with the commenter who suggested that notices should be 
written in a manner that ensures that those impacted or affected by a 
Federal or federally assisted project or program receive notices that 
are clear, concise, and ensure that the necessary information is 
efficiently and effectively provided. FHWA believes that the final rule 
provides the requirements necessary to develop such notices but 
believes that each Federal agency must develop its own processes and 
policies to ensure that the notices being provided serve the purpose of 
providing needed information as effectively and efficiently as 
possible.
    Similarly, FHWA does not agree that the notice of intent to 
acquire, rehabilitate, or demolish be removed from this regulation. As 
indicated in the regulatory language, the notice's specific purpose is 
to provide written assurance that the agency intends to acquire the 
real property, in whole or in part. This notice is provided to an 
occupant who is either required to move temporarily or who may be 
permanently displaced. An important purpose of this notice is to allow 
a person who may be either required to move temporarily or who may be 
permanently displaced to move in advance of offers or other notices 
while not jeopardizing any potential relocation assistance to which 
they may be entitled.
    As a result of the above analysis, FHWA revised Sec.  24.203(d) to 
specifically include persons who are required to temporarily move. FHWA 
believes that the modifications to Sec.  24.203(d) will clarify the 
purpose, intent, and timing of this notice. The FHWA does not believe 
an additional discussion in Sec.  24.203 on timing of notices is 
warranted.

Section 24.205(c) Relocation Planning Advisory Services and 
Coordination

    FHWA received one comment requesting that as part of relocation 
assistance advisory services, and to ensure active citizen 
participation throughout the whole project, agencies should establish a 
relocation committee to include agency personnel, community residents, 
and community leaders. The commenter noted such a committee could be 
essential in cultivating a bond of trust with the residents, moving 
proposed projects forward in a timely manner, and in helping to 
identify the needs of displaced persons.
    FHWA Response: FHWA appreciates this information on best practices 
but does not believe that such a process should be a requirement. 
However, FHWA does agree with the commenter's insight that establishing 
trust with tenants encourages participation and provides a good method 
to ensure successful relocation outcomes and advance projects in a 
timely manner. The FHWA notes that the relocation planning requirements 
remained largely unchanged for almost 40 years, in this final rule and 
the rulemakings that preceded it; beginning with the final rule in 
1989, 59 FR 8909 (March 2, 1989), and in the 2005 rulemaking, 70 FR 590 
(January 4, 2005). The 1989 final rule preamble explained in part that 
``. . . FHWA believes that most displacing agencies are well aware of 
the program or project benefits which can be derived through early and 
sound relocation planning and many agencies currently use comprehensive 
planning techniques in project development. FHWA does not view 
relocation planning as a complicated, time-consuming activity. FHWA 
sees relocation planning as a process which provides meaningful 
information to program and project decisionmakers. It does not need to 
result in a detailed document containing unnecessary data and needless 
problem solving. Instead, it should be a process which is scoped to the 
complexity and nature of anticipated program or project relocation 
activity and should not require a burdensome commitment of agency 
resources.''
    The Uniform Relocation Assistance and Real Property Acquisition 
Policies Act of 1970 notes that ``This subchapter establishes a uniform 
policy for the fair and equitable treatment of persons displaced as a 
direct result of programs or projects undertaken by a Federal agency or 
with Federal financial assistance. The primary purpose of this 
subchapter is to ensure that such persons shall not suffer 
disproportionate injuries as a result of programs and projects designed 
for the benefit of the public as a whole and to minimize the hardship 
of displacement on such persons.'' 42 U.S.C. 4621. This section also 
includes congressional findings and declarations which note that the: 
``. . . (2) relocation assistance policies must provide for fair, 
uniform, and equitable treatment of all affected persons; (3) the 
displacement of businesses often results in their closure . . .''
    While this final rule will not include additional requirements for 
relocation planning, FHWA believes that modern projects and attendant 
right-of-way needs are becoming more complex and, in some cases, more 
impactful to those displaced and the surrounding communities. Such 
planning necessitates a thorough analysis and understanding of the 
potential displacements a proposed project or its alignments may cause. 
Such analysis and understanding are critical to ensuring that those 
displaced do not suffer disproportionate injuries and that they receive 
uniform, fair, and equitable treatment.
    FHWA encourages each funding agency to carefully review its 
policies and procedures while implementing this rule in order to ensure 
that the relocation planning requirements are being caried out. FHWA 
believes that the consequences of not carrying out the requirements of 
relocation planning may cause disproportionate injury to those 
displaced, project delay, escalation of project costs, and difficulty 
in timely development and advancement of projects. FHWA will consider 
developing new FAQ and other supporting materials to explain the need 
for effective relocation planning, emphasize best practices and success 
stories, and to examine lessons learned.
    FHWA also revised the appendix A, Sec.  24.205(a) discussion by 
adding a reference to those who live in other federally subsidized 
housing to ensure that agencies are aware of the need to assess and 
plan for effective advisory

[[Page 36931]]

services. The FHWA encourages agencies to creatively and 
collaboratively develop methods to provide advisory services that meet 
the needs of those displaced.

Section 24.205(c) Relocation Planning Advisory Services and 
Coordination

    FHWA received one comment requesting that as part of relocation 
assistance advisory services, and to ensure active citizen 
participation throughout the whole project, agencies should establish a 
relocation committee to include agency personnel, community residents, 
and community leaders. The commenter noted that at the public 
corporation where the commenter works, a housing committee was 
established. The commenter relayed that the committee was essential in 
cultivating a bond of trust with the residents, moving proposed 
projects forward in a timely manner, and in helping to identify the 
needs of displaced persons.
    FHWA Response: FHWA appreciates the information about the housing 
committee and its processes and best practices. FHWA however does not 
believe that such a process should be a requirement. In addition, 
appendix A Sec.  24.205(a) addresses the need to ensure that 
relocations that may take additional time for advisory services and 
coordination are properly addressed through the relocation planning 
process.
    However, FHWA agrees with the commenter's insight about the 
importance of the relationship with residents to ensure active citizen 
participation and to move the proposed project in a timely manner. FHWA 
also agrees with the commenter that residents can help identify the 
specific needs of some families.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.205(c)(2)(II)(C) Relocation Assistance Advisory Services; 
Services To Be Provided--Inspection Criteria

    One commenter believes that improvements could be made to the 
requirements necessary to establish that a dwelling is DSS. They 
reasoned that updating, revising, and clarifying inspection 
requirements in the Uniform Act would be consistent with current 
requirements in many federally assisted housing programs. They noted 
that the Housing Opportunity Through Modernization Act of 2016 (Pub. L. 
114-201) designated both lead-based paint, and missing or defective 
carbon monoxide detectors, as life-threatening conditions for the 
purposes of initial housing quality standards inspections for Housing 
Choice Voucher and Project-Based Voucher units. They also noted that 
the Lead Safe Housing Rule, 24 CFR 35.80 et seq., which applies to all 
target housing that is federally owned or assisted, also requires lead 
paint inspections, and risk assessments/remediation, if necessary, 
prior to occupancy in all programs (excluding mortgage insurance), 
except the Housing Choice Voucher Program and project-based units 
receiving less than $5,000. The commenter believes that updating 
Uniform Act inspection language to include similar provisions would be 
consistent with current requirements.
    The FHWA Response: A DSS inspection in this final rule requires a 
determination that the dwelling meets the more stringent requirements 
of this rule, local housing code, Federal agency regulations, or the 
agency's regulations or written policy. For example, in instances in 
which the funding agency has established requirements or standards for 
DSS that are more stringent than the regulation's requirements, the 
funding agencies' requirements would need to be met. Displacing 
agencies will need to ensure that they understand which DSS 
requirements are most stringent and apply them when making a DSS 
inspection and determination.
    FHWA appreciates that some agencies require that a DSS inspection 
include inspection and determination protocol in addition to those 
required by this rule. These additional considerations or requirements 
may be established through specific agency policy, regulation, or 
statute. FHWA, however, does not believe that requiring a certain 
inspection criterion, in this case a criterion for lead-based paint, in 
this final rule is necessary. FHWA believes that such inspections and 
testing should best be done by providers who have the requested 
training and tools to ensure effective lead-based paint testing. FHWA 
believes that the regulation's requirement that the dwelling meets the 
more stringent requirements of this rule, local housing code, Federal 
agency regulation or the agency's regulations or written policy, 
ensures that each Federal funding agency and its recipients will be 
aware of and use the required criteria that ensure a dwelling is DSS. 
Funding agencies may determine that additional guidance or 
requirements, which require additional considerations or standards be 
met when making DSS determinations, are necessary for their program.
    As a result of this analysis, no additional change was made in the 
final rule.

Section 24.205(c)(2)(II)(C) Relocation Assistance Advisory Services; 
Services To Be Provided--Comparable Inspection

    One commenter understands the proposed changes to allow an agency 
to forego the required DSS inspection. One commenter felt that the 
requirement for the agency to inspect a comparable dwelling prior to 
using it in any eligibility determination is overly burdensome to the 
agency. One commenter advised that the agency currently relies on an 
outside visual inspection and review of MLS listing information when 
selecting comparable replacement housing. This commenter has the belief 
that most displaced persons do not choose the comparable housing made 
available to them, and when they do select a replacement dwelling, the 
agency requires the dwelling to pass an extensive DSS inspection prior 
to occupancy and a replacement housing payment being made. One 
commenter stated if agencies do not inspect comparable replacement 
units, the rule should specify that the maximum replacement housing 
payment must be recalculated if the unit upon which it was based is 
later found to not be DSS. Two commenters were uncertain if the new 
language regarding inspection of the dwellings used in the comparable 
replacement housing determination means that all the comparable 
dwellings must be inspected, or if only the selected comparable 
dwelling must be inspected. One of these commenters requested guidance 
on what would be an acceptable reason for not being able to walk 
through and physically inspect the interior and exterior of comparable 
dwellings.
    FHWA Response: Prior to requiring a residential occupant to move 
from their dwelling, an agency must make at least one DSS comparable 
replacement dwelling available to them. This final rule at Sec.  
24.205(c)(2)(ii)(C) continues to require that where feasible, 
comparable housing should be inspected prior to being made available. A 
walkthrough and physical inspection of the interior and exterior of the 
displaced person's replacement dwelling also continues to be required 
to ensure that the replacement dwelling is DSS prior to a payment being 
provided to the displaced person. The requirement for a physical 
inspection of the replacement dwelling is unchanged in this final rule. 
FHWA also believes that given the importance of ensuring displaced 
persons are treated fairly, consistently, and equitably, so they will 
not suffer disproportionate injuries as a result of

[[Page 36932]]

projects designed for the benefit of the public as a whole, an agency 
should develop policies that limit or prohibit the use of uninspected 
comparable dwellings. As a result of this analysis, FHWA has 
reorganized the appendix A sections of both Sec.  24.205(c)(2)(ii)(C) 
and Sec.  24.403(a)(1) to more clearly relate to the relevant 
regulation section requirements and for purposes of organizational 
clarity.
    As a result of this analysis, no additional change was made in the 
final rule.

Section 24.205(c)(2)(ii)(C), Relocation Advisory Assistance Services--
Notification Requirements When DSS Inspection of Comparable Replacement 
Housing Is Not Performed

    One commenter advised that the notice requirement may suggest the 
agency is not providing all relocation services to the displaced 
person. One commenter suggested that providing a written justification 
of why a DSS inspection was not done for a comparable dwelling before 
determination of the RHP should not be a requirement in the final rule. 
This commenter felt that the agency should be allowed to provide an 
alternative justification in the RHP calculation and package that is 
eventually presented to the displaced person.
    FHWA Response: The NPRM proposal required that in unusual or 
extraordinary circumstances when a physical inspection of a comparable 
dwelling is not possible, the agency is required to provide the 
displaced person written justification. FHWA does not believe that 
acknowledging that a comparable dwelling was not physically inspected 
in unusual or extraordinary circumstances and requiring a written 
notice in these instances will limit required assistance and services 
to those displaced. FHWA notes that the required written notice must be 
provided to a displaced person as soon as possible but not later than 
the notice of relocation eligibility, Sec.  24.203(b). FHWA also notes 
that the primary question here is typically whether the interior of the 
comparable dwelling was physically walked through and inspected.
    FHWA understands that not all comparable dwellings may be available 
for physical inspection for a variety of practical reasons but believes 
agencies must balance that against the critical requirement that a 
comparable dwelling must be DSS in order to be deemed made available. 
FHWA believes that a walk through and physical inspection of the 
interior and exterior are the only realistic and reliable ways an 
agency can ensure that it has met the requirements to ensure a 
comparable replacement dwelling is DSS. Therefore, it is important to 
emphasize that instances in which a physical walk through and 
inspection of a comparable dwelling is not possible, should be the 
exception and not the normal course of business. When possible, 
agencies should consider removing uninspected comparable dwellings from 
consideration. Nothing in this rule prohibits agencies from 
establishing additional policies or requirements for physical 
inspection of comparable dwellings.
    In addition, an agency should provide clear direction and policy or 
requirements on how to document and communicate why an inspection was 
not made both to the displaced person and in the agency's records. 
Should the selected comparable dwelling later be found to not be DSS 
then the agency's policies and procedures must ensure that a displaced 
person's eligibility determination will be recalculated. If the agency 
does not recalculate the eligibility in these instances, FHWA does not 
believe that the requirement to ensure that a decent, safe and sanitary 
dwelling be made available are met.
    As a result of this analysis, FHWA has reorganized the appendix A 
sections of both Sec.  24.205(c)(2)(ii)(C) and Sec.  24.403(a)(1) and 
added language to more clearly indicate the relevant regulation section 
requirements and for purposes of organizational clarity.
    As a result of this analysis, no additional change was made in the 
final rule.

Section 24.205(c)(2)(ii)(D)--Relocation Planning, Advisory Services, 
and Coordination; Appendix A

    One comment was received regarding language in the NPRM encouraging 
agencies ``. . . whenever possible . . .'' to provide minority persons 
who reside in communities of minority concentration with opportunities 
to relocate to DSS housing in areas other than those of minority 
concentration. The commenter believes these preferences should be up to 
the persons being relocated. Further, they state that there is a 
likelihood that this will lead to non-uniform treatment of displaced 
persons. The commenter further raised concerns that the requirement to 
document efforts to meet the goals of this section would be 
administratively burdensome.
    FHWA Response: FHWA believes the needs and preferences of all 
displaced persons are determining factors in developing a relocation 
assistance eligibility comparable determination. The role of the 
acquiring agency is to give displaced persons reasonable opportunities 
to relocate to comparable housing without mandating or limiting areas 
of that housing. However, it is the displaced person's right to make 
the final replacement dwelling selection for themselves. FHWA notes 
that the goals and statements in this section of the current final rule 
have been consistently stated in preceding final rules for almost 40 
years. During that time, FHWA received little indication that this 
section's goals and permissive language were unclear or impractical. 
FHWA reviewed the statutory language in the Uniform Act at Section 
4621(b)(2) and (3), Declaration of Findings and Policy. The primary 
purpose of the relocation assistance is described as ensuring that 
displaced persons do not suffer disproportionate injuries as a result 
of being displaced for programs or projects undertaken by a Federal 
agency or with Federal financial assistance. It further states that 
``the improvement of housing conditions of economically disadvantaged 
persons under this subchapter shall be undertaken, to the maximum 
extent feasible . . .''
    FHWA revised appendix A to more clearly indicate that agencies 
should continue to, where practical and feasible, provide those 
displaced persons who live in areas of minority concentration 
opportunities to improve their housing conditions and living 
situations, and that agencies should maintain adequate written 
documentation of efforts made to locate such comparable and replacement 
housing.

Section 24.208(c) Aliens Not Lawfully Present in the United States

    FHWA received five comments on this section's proposed changes. One 
commenter expressed concerns that the NPRM's proposed changes might 
involve the collection of sensitive personally identifiable information 
and would require implementing new processes to ensure the information 
is appropriately safeguarded. One commenter asked that the word 
``alien'' not be used as it may be perceived to be offensive. One 
commenter felt that the proposed changes to the verification process 
would be administratively burdensome and suggested simply retaining the 
requirement for verification on a case-by-case basis. One commenter 
noted that they viewed the proposed change as creating a new 
requirement. One commenter noted that they run an essentially parallel 
system, which results in a certification from their recipients 
verifying citizenship

[[Page 36933]]

and immigration status, and believes it meets the requirements of this 
section.
    FHWA Response: FHWA appreciates the comments, perspectives, and 
concerns expressed. FHWA believes that it is important to note that 
this section of the regulation continues to require that displaced 
persons provide a certification that they are a citizen or national of 
the United States, or an alien lawfully present in the United States. 
The statutory requirement found at 42 U.S.C. 4605 was added to the 
regulations by a final rule in 1999 (64 FR 7127, February 12, 1999). 
Should the agency deem an alien's certification to not be credible or 
invalid, the regulation continues to require that the agency take the 
additional step of verifying the person's United States citizenship 
status. The primary change in this final rule is to the method for 
verification. The final rule requires agencies to utilize the United 
States Citizenship and Immigration Services (USCIS) Systematic Alien 
Verification System (SAVE) rather than the previous requirement to 
contact the local Bureau of Citizenship and Immigration Services office 
for verification. Agency processes for obtaining and handling personal 
information as part of their Uniform Act programs should be secure and 
collect the fact-specific information required for verification.
    FHWA acknowledges a need to ensure that in verifying citizenship 
status, a displaced person should be afforded deference and 
consideration to ensure that derogatory or otherwise insensitive 
language is not used. The use of the term ``alien'' as it relates to 
this rule can be found in statute in Public Law 105-117, November 21, 
1997. FHWA considered whether other terms might reasonably be used. 
FHWA notes that the term ``alien not lawfully present in the United 
States'' appears in the Uniform Act, 42 U.S.C. 4605(a). Moreover, the 
term ``alien'' has a specific legal meaning and is used in several 
other Federal agency regulations and statutes describing citizenship 
status for those who live in the United States. (See Title 8, U.S.C. 
and 8 CFR Chapter I). Consequently, FHWA has not made any changes in 
this final rule.

Subpart D--Payments for Moving and Related Expenses

Section 24.301(b)(2) Moves From a Dwelling, Self-Moves; Section 
24.301(c)(2) Moves From a Mobile Home, Self-Moves: Use of Commercial 
Moving Bids or Agency Staff Prepared Estimates for Self-Moves

    FHWA received responses from eight commenters regarding the 
proposed alternative reimbursement methodology for residential self-
moves. The NPRM included a request for comments on adding an option for 
residential self-moves based on either the amount of the lower of two 
commercial moving bids, or an estimate prepared by a qualified agency 
staff person. FHWA also asked for comments on whether a commercial 
mover's overhead and profit should be subtracted from a self-move 
payment eligibility determination or if the self-move payment should be 
based on the full amount of the lowest bid. FHWA received a wide 
variety of suggestions in response.
    One commenter stated that reducing the administrative burden on the 
displaced person is a positive thing and that payment to the displaced 
person for a residential self-move should be based on either the lower 
of two moving bids, or the average of the two bids. Another commenter 
was concerned that allowing a residential self-move payment based on 
the lower of two bids from a commercial mover would result in an 
increase in administrative burden to agency personnel. The commenter 
believes that it may be preferable to only add or adopt the use of a 
moving cost finding for nonresidential moves as described in the 
preamble that allows a qualified agency staff person to prepare 
estimates.
    Five commenters believe that determining a moving company's 
overhead costs would be difficult and impractical. One commenter 
suggested that any adjustment to the bid amount should be a flat 
percentage deduction, and that overhead in this rule should only 
include administrative expenses and office space costs, while another 
suggested that 20 percent of the lowest bid amount is a fair amount to 
deduct for a commercial mover's overhead. This same commenter stated 
that this percentage is used in their State and is based on their poll 
of several commercial movers.
    One commenter believes that the administrative costs should not 
include costs of vehicle, gas, labor, etc., used during a move. The 
commenter reasoned that the costs for vehicle, gas, and labor are costs 
that are also borne by the displaced person as part of a self-move and 
should be compensated.
    One commenter asked whether FHWA would monitor the hourly fees 
charged to a consumer when using self-moves. The commenter further 
wanted to know if a person can submit a Freedom of Information Act 
request to FHWA for movers' rates. The commenter also wanted to know 
what the displaced person's eligibility for reimbursement would be if 
the rates are not within the limit scales of the U.S. Department of 
Labor's Consumer Price Index.
    One commenter did not support using commercial moving bids to 
determine eligibility for reimbursement of a residential displaced 
person's self-move. Another commenter believes that adding an 
additional residential self-move payment option may have drawbacks and 
would add additional complexity to each residential relocation. This 
same commenter expressed the belief that residential displaced persons 
may be less able than nonresidential displaced persons to determine 
whether a self-move would be advantageous.
    One commenter noted, that in their experience, reimbursement based 
on actual costs is not a viable option for a residential self-move, 
because it is often very difficult to obtain actual cost receipts from 
the displaced person, or alternatively for a displaced person to obtain 
information and documentation from commercial movers, which would be 
needed to calculate reimbursement eligibility.
    FHWA Response: FHWA appreciates the supportive and constructive 
comments received and program insight offered. FHWA believes the 
addition of a self-move option is beneficial in that it provides more 
choices to the displaced person. FHWA believes it is the responsibility 
of the agency to provide adequate advisory services to ensure that the 
displaced person clearly understands the moving options available and 
makes a selection that best meets their needs. FHWA noted both the 
support and concerns raised about use of commercial bids to determine 
reimbursement amount eligibility for residential self-moves and about 
whether and how to adjust the amount of the lowest commercial bid to 
account for overhead. FHWA notes that overhead costs across the Nation 
and in individual markets vary based on a number of factors. FHWA does 
not believe that establishing a national and Federal Government-wide 
flat percentage to account for overhead in this final rule is 
practical. For these reasons, the final rule will not require a 
deduction from a move cost estimate to account for overhead. FHWA 
considered whether allowing reimbursement on this basis might lead to 
waste, fraud, or abuse and believes that proper funding agency 
oversight and stewardship will ensure that this provision is 
appropriately and effectively administered. Federal funding agencies 
that believe more financial control is needed may develop policies and 
procedures that include the

[[Page 36934]]

deduction of an amount from the commercial bids which represents 
overhead and profit but are not required to do so.
    The current regulation allows a qualified staff person to prepare 
the moving cost payment estimate for a nonresidential self-move; 
therefore, allowing similar method to establish reimbursement 
eligibility for a residential move should not be burdensome. FHWA also 
notes that the self-move reimbursement for labor based on hourly rates, 
etc. is not new to this rulemaking. The Federal funding agencies may 
also utilize policies and guidance on how best to administer this 
requirement. For example, in its role as a Federal funding agency, FHWA 
provides stewardship and oversight by requiring approved manuals that 
describe approved processes its grantees follow in determining actual 
reasonable and necessary reimbursement. FHWA received little or no 
feedback over the years that would lead FHWA to conclude that this 
additional residential move cost reimbursement option may create waste, 
fraud, or abuse.
    FHWA revised the final rule by making similar revisions in Sec.  
24.301(b)(2)(ii) through (iv) (moves from a dwelling) and (c)(2)(ii) 
through (iv) (moves from a mobile home). Section 24.301(b)(2)(ii) and 
(c)(2)(ii) add criteria needed to determine and document self-move 
reimbursement eligibilities. Section 24.301(b)(2)(iii) and (c)(2)(iii) 
adds new flexibility to allow use of a move cost estimate prepared by 
qualified agency staff. Section 24.301(b)(2)(iv) and (c)(2)(iv) adds 
new flexibility to base residential self-move cost reimbursement 
eligibility on the lower of two commercial moving cost bids.

Section 24.301(d) Moves From a Business, Farm, or Nonprofit 
Organization--Moving Cost Finding and Nonresidential Moving Cost 
Schedule

    FHWA received three comments on whether a moving cost finding for 
nonresidential moves should be reinstated, or if a nonresidential 
moving cost schedule should be developed and included in the final 
rule. Both methods were proposed to streamline the process for 
determining moving cost benefit amounts for low-cost, uncomplicated 
nonresidential moves. One commenter was opposed to a Fixed Moving Cost 
Schedule for Nonresidential Moves because there are too many variables 
but supported adding a nonresidential fixed moving cost schedule for 
use when developing a benefit amount for personal property located in 
storage facilities. Another commenter concurred with the proposal to 
adopt the use of a moving cost finding for businesses and to consider 
development of a nonresidential moving cost schedule for uncomplicated 
moves because these methods would provide streamlined approaches that 
will reduce the burden for both the nonresidential displaced person and 
the agency. A final commenter supported development of a tool similar 
to the Fixed Residential Moving Cost Schedule and preferred any type of 
schedule to take jurisdictional cost differences into account. This 
same commenter believed that the proposed schedule would reduce 
administrative burden and expedite the payment of moving expenses to 
displaced businesses and use of such a tool would eliminate the time-
consuming tasks of soliciting at least two commercial moving bids or 
seeking backup documentation from displaced businesses to support their 
reimbursement requests.
    FHWA Response: FHWA appreciates receiving the comments regarding 
the proposal to reinstate a nonresidential move cost finding and to 
develop a nonresidential moving cost schedule. FHWA recently completed 
a research project examining possible nonresidential moving cost 
estimation and reimbursement methods in use by a study group of nine 
State DOTs and four Federal agencies. The comments received in the NPRM 
are in line with the findings in the study's final report, which will 
be published shortly.
    FHWA agrees that including additional streamlining methods for 
developing moving cost eligibility determinations can provide 
additional options and reduce administrative burden to both displaced 
persons and agencies. However, FHWA does not have enough supportive 
materials and data to institute a fixed cost schedule for 
nonresidential moves in this final rule. FHWA will continue to explore 
potential options and may consider at a later date the possibility of 
adding a nonresidential moving cost schedule option to a future 
rulemaking.
    FHWA believes that for nonresidential moves, a move cost finding 
would only be appropriate for moves of personal property which are 
uncomplicated and therefore do not require disconnect and reconnection, 
and for items which do not require specialty movers, such as a rigger, 
or equipment to provide specialty moving services. FHWA believes that 
it is important to establish a maximum amount for nonresidential move 
cost findings. The final report of nonresidential moving cost methods 
included a survey group of nine State DOTs and identified any current 
move cost finding threshold levels currently used with respect to 
nonresidential moving costs. The criteria for the use of these findings 
vary by State DOT for an uncomplicated move. State DOTs used thresholds 
to determine uncomplicated moves which could be accomplished using a 
schedule ranging from $2,500 to $10,000 in costs. Several State DOTs 
also used additional criteria to further identify non-complex moves 
that could be accomplished using a schedule move. Based on this 
research and information, FHWA included in the final rule a move cost 
finding option that may be used for uncomplicated nonresidential moves 
of no more than $5,000 in estimated cost. FHWA revised the final rule 
at Sec.  24.301(d)(2) by adding Sec.  24.301(d)(2)(iii) Move Cost 
Finding.
    The FHWA will develop FAQ to provide additional examples of when a 
move cost finding may be appropriate for nonresidential moves.

Section 24.301(e) Payment for Actual Reasonable Moving and Related 
Expenses--Personal Property Only

    FHWA received seven comments regarding the use of the additional 
room method to establish moving cost eligibility when moving personal 
property located outside of a dwelling. Five commenters supported using 
the additional room method as a sensible way to deal with small, 
residential personal property only--outside moves. Three of these 
commenters believe that use of the additional room method would be much 
more convenient and cost effective as opposed to doing a separate 
residential personal property only--outside move. One commenter 
suggested that the use of the additional room method be allowed for 
moving personal property outside the dwelling when the occupants will 
be displaced. This same commenter asked if it would be appropriate to 
use the additional room method to establish a minimum payment or if 
there would be a way to pro-rate that amount for a smaller residential 
personal property only--outside move where an additional room could be 
considered a windfall.
    FHWA Response: FHWA's NPRM proposed changes to appendix A section 
24.301(e), Personal Property Only, recognize that in some instances the 
costs of obtaining moving bids for moving personal property located 
outside of the dwelling are prohibitive. The appendix A discussion 
provides examples of when it may be appropriate to use the additional 
room method to determine moving cost reimbursement eligibility. FHWA 
does not believe that the moving cost schedule can be used to

[[Page 36935]]

either establish a minimum payment or to determine a fractional or a 
percentage payment amount for personal property moves. The fixed 
residential moving cost schedule is meant to be a simplified method for 
determining eligibility and documenting determinations of eligibility; 
therefore, attempting to establish a minimum payment or calculating a 
fractional amount is not allowed. The appendix A link to the schedule 
on the FHWA website will be updated when the new schedule is published, 
however, the current schedule is available on the FHWA website via this 
link: www.fhwa.dot.gov/real_estate/uniform_act/relocation/moving_cost_schedule.cfm.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.301(e) Personal Property Only

    One comment was received suggesting agencies be permitted to 
prepare relocation plans and negotiate directly with property owners 
when relocation is for personal property only move, such as moving a 
shed. The commenter believes that allowing some types of simple moves 
of personal property should not necessarily need to wait until the 
project commences. The commenter expressed concern with the time 
necessary for the agency to meet the relocation planning requirements 
and the added costs of plan preparation that may impact project budgets 
and project delivery.
    FHWA Response: Any real property acquisition and relocation 
activity must be completed in compliance with Uniform Act requirements 
if Federal funding or Federal financial assistance will be used for the 
program or project, even if such funds have not yet been approved as of 
the date of the displacement. Agencies are required to identify and 
plan for displacements in the early stages of project development, and 
prior to any action that will cause displacements, as discussed in 
Sec.  24.205(a). The planning includes scoping the nature and 
complexity of any displacements, and evaluation of agency resources 
available to carry out timely and orderly relocations. This necessarily 
includes providing moving expenses of personal property only.
    As proposed in the NPRM, this final rule in appendix A, Sec.  
24.301(e), includes a streamlined method for residential moves where 
only a limited amount of personal property is moved. For these 
residential moves, agencies may make an eligibility determination and 
payment based upon the use of the ``additional room'' category of the 
Fixed Residential Move Cost Schedule. This option provides the owner of 
the personal property the option of performing a self-move. Agencies 
may also use a single commercial bid or estimate may be used for low-
cost, uncomplicated residential moves as discussed in Sec. Sec.  
24.301(b) and (c) and for nonresidential moves, Sec.  24.301(d) allows 
similar options.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.301(g)(7) Payment for Actual Reasonable Moving & Related 
Expenses--Tenant Replacement Housing Search Costs, Credit Checks

    One commenter expressed concern that some tenant occupants cannot 
afford to pay out-of-pocket costs for numerous credit checks when 
searching for a replacement rental dwelling, which often require credit 
checks for each adult that will be residing in the dwelling. The 
commenter proposed the addition of a credit check allowance of at least 
$500 as a ``related expense.'' Under the commenter's proposal, the 
tenant occupant would be required to provide receipts to the agency 
showing actual costs for any credit checks completed, and if not 
provided, that amount would be deducted from their moving cost 
reimbursement.
    FHWA Response: FHWA recognizes that a credit check or application 
fee are a typical cost for the process of obtaining tenant replacement 
housing. The FHWA revised the final rule by adding a new Sec.  
24.301(g)(7) to allow reimbursement of a tenant's credit checks and 
applications fees incurred while searching for a replacement rental 
dwelling; revising Sec.  24.301(h)(9) to list ineligible costs 
associated with a tenant's search for a replacement rental dwelling, 
and renumbering Sec.  24.301(g)(7) accordingly. FHWA anticipates that 
there will be differences in fees depending on the location and that in 
some markets, tenants may have to make several applications to lease a 
dwelling. Agencies may also consider making advanced payments for 
necessary tenant credit checks to relieve a hardship as allowable under 
Sec.  24.207(c).

Section 24.301(g)(12) Payment for Actual Reasonable Moving and Related 
Expenses--New Construction Permits

    FHWA received a response from one commenter who believes excluding 
new construction permit fees from moving cost reimbursement eligibility 
creates a hardship for the displaced person, since they are being 
required to relocate.
    FHWA Response: The NPRM did not propose a change to the eligibility 
of new construction permit fees. In most instances, such fees are not 
an eligible expense. FHWA notes that the NPRM clarified that permit 
fees are eligible expenses when a construction permit is necessary for 
repairs, improvements, or modifications to make to the replacement 
property suitable for the operation of the displaced person's business, 
farm, or nonprofit organization. FHWA believes that construction or 
substantial reconstruction of a structure at the replacement site to 
make it fit for occupancy is not generally an allowable moving cost 
expense, except in justifiable circumstances, such as, when no 
replacement site with existing improvements fit for occupancy is 
available to accommodate the business, farm, or nonprofit organization, 
or if determined to be reasonable and necessary under Sec.  24.304 or 
if required by local law, code, or ordinances.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.301(g)(13) Payment for Actual Reasonable Moving and Related 
Expenses--Professional Services

    FHWA received one comment on Sec.  24.301(g)(13) recommending that 
professional services eligibility determinations be pre-approved and in 
writing.
    FHWA Response: FHWA believes that the actual, reasonable, and 
necessary test for eligibility for reimbursement of expenses is 
generally explained and discussed with a displaced person when 
providing advisory services. The purpose of the discussion is to ensure 
that the displaced person is informed about both eligibility and the 
relevant agency procedures for establishing eligibility. FHWA agrees 
that it is good practice to maintain written documentation during a 
relocation. For a complicated relocation, Agencies may want to provide 
certain written approvals or explanations of eligibility to a displaced 
person. However, FHWA believes requiring written preapproval of 
professional services in this rule is unnecessary. Agencies may 
establish policies and procedures as they deem necessary, which may 
require certain preapprovals; however, FHWA notes that each move and 
determination of actual reasonable and necessary costs are fact 
specific issues.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

[[Page 36936]]

Section 24.301(g)(15)(i)-(ii) Eligible Actual Moving Expenses--Actual 
Direct Loss of Tangible Personal Property

    FHWA received two comments regarding the proposed changes related 
to calculating a payment for actual direct loss of tangible personal 
property. One commenter supports the proposal to expressly reimburse 
for moving items not currently in use but disagrees with the proposal 
to exclude reimbursement for storage. One commenter agrees with the 
proposal to modify these paragraphs to allow for a new two-part 
consideration and provide separate paragraphs for calculating payments 
for property currently in use and items not currently in use. The 
commenter also concurs with the proposal to have a separate subordinate 
paragraph for goods held for sale, and believes these changes clarify 
the payment calculation requirements.
    FHWA Response: The final rule will incorporate the NPRM's proposed 
changes including separate methods for calculating payments for items 
currently in use and for items not currently in use. For items in use, 
reimbursement will be based on the lesser of the cost to move and 
reinstall the item or fair market value of the item in place at the 
displacement site ``as is for continued use.'' For items not currently 
in use, the reimbursement will be based on the cost to move the item, 
as is, with no allowance for storage. FHWA believes that basing the 
reimbursement eligibility for nonresidential personal property items 
not currently in use on the cost to move the item ``as is,'' with no 
allowance for storage, is appropriate in most circumstances. However, 
FHWA included clarifying language in Sec.  24.301(g)(15)(ii) addressing 
instances when storage may be appropriate because the replacement site 
is not yet ready. This final rule change allows an agency to address 
those instances where the process of moving from the acquired 
nonresidential site to the replacement site is delayed. In those 
instances, the final rule will require an agency to approve storage 
before these costs can be reimbursed.

Section 24.301(g)(18)(i) Searching for a Replacement Location

    Five comments were received regarding the increase of the maximum 
eligibility for search expenses to $5,000. Two comments were received 
regarding the addition of attorney's fees as an eligible cost when 
searching for a replacement location. Two commenters support the 
payment being increased to the maximum of $5,000. One of those 
commenters added that if the amount is increased, documentation of the 
expenses should be required. One commenter noted that attorney's fees 
should not be included as an eligible expense because the bulk of the 
eligibility could be used for attorney's fees and limit other costs 
incurred by the displaced person. This commenter indicated that 
attorney's fees associated with the purchase and closing should be 
eligible under Sec.  24.301(g)(8), Other Moving and Related Expenses. 
One commenter believes that the inclusion of attorney's fees within 
search expenses would cause confusion between eligibility in this 
section and those for professional services eligible under Sec.  
24.303(b). The commenter suggests that attorney's fees which are 
determined to be reasonable and necessary be made explicitly eligible 
under Sec.  24.303(b). One commenter expressed concern about the 
current FAQ being proposed for incorporation into Sec.  
24.301(g)(18)(i)(F) in appendix A, to provide clarification that search 
expenses may be incurred anytime the business anticipates it may be 
displaced will create eligibility issues, especially with a project 
that eventually does not go forward. The commenter speculated that 
businesses would not keep track of their expenses prior to agency 
involvement with them and suggested limiting the period of time from 
anytime to 90 days prior to the Initiation of Negotiations.
    FHWA Response: FHWA believes the increased reimbursement limits 
will allow a displaced person to be reimbursed for more of the search 
costs they may incur. The FHWA also believes the option to use legal 
counsel to negotiate the purchase or lease of a replacement site is an 
option elected by the business owner and eligibility would be subject 
to an agency's determination that the costs are actual reasonable and 
necessary.
    The final rule includes eligibility for attorney's fees in Sec.  
24.301(g)(18)(i)(F) with clarification in the corresponding section of 
appendix A, by striking ``time spent'' and inserting ``expenses'' to 
allow eligibility for attorney's fees necessary for negotiating the 
purchase of a replacement site. The changes clarify that expenses for 
reimbursement of documented, reasonable, and necessary attorney's fees 
for such negotiations is an eligible expense up to the $5,000 maximum 
for search expenses in this final rule. FHWA believes attorney's fees 
are separate and distinct from negotiations under searching expenses 
when applied under Sec.  24.303(b) as a professional service for 
determining the suitability of the replacement site for the 
nonresidential relocation. The FHWA believes incorporating these 
changes in this final rule will allow clarity and flexibility for 
displaced nonresidential occupants. As discussed in the NPRM preamble, 
FHWA will incorporate a current FAQ into the appendix A to clarify that 
search expenses may be incurred anytime the business anticipates it may 
be displaced, to include the period prior to project authorization or 
the initiation of negotiations if the agency determines them to be 
actual, reasonable, and necessary.
    FHWA believes displaced nonresidential occupants may need the 
opportunity to search for a suitable replacement site at the earliest 
opportunity. These changes in the final rule allow that should the 
nonresidential person be displaced, such expenses may be eligible for 
reimbursement when the business received the notice required in Sec.  
24.203(b) and may only qualify for payment after the agency determined 
such costs to be actual, reasonable, and necessary.

Section 24.301(g)(18)(i)-(ii) Searching for a Replacement Location--One 
Time Minimal Documentation Payment

    FHWA received responses from six commenters regarding the proposed 
addition of an alternative $1,000 payment eligibility, requiring little 
or no documentation, for costs associated with searching for a 
replacement location. One commenter supported the change and, in 
concert with two other commenters, requested the words ``up to'' be 
removed from the language for this section, so the minimum payment 
would be $1,000. One of these same commenters also suggested the word 
``little'' be replaced with minimal. Several commenters suggested that 
FHWA consider the little or no documentation search payment eligibility 
be a minimum of $2,500.
    Two of the commenters stated that the flexibility of not requiring 
documentation will relieve an administrative burden for both the 
displaced person and agencies. One of these commenters reasoned that 
increasing the alternative payment amount to $2,500 is supportable 
because the payment amount of $1,000 does not provide adequate 
incentive for the displaced person to accept the lower amount, and it 
is likely a business will incur searching expenses that exceed the 
$1,000. This same commenter cited the FHWA's 2010 Business Relocation 
Assistance Retrospective Study, which found that the administrative 
burden placed on both businesses and agencies by the extensive 
documentation

[[Page 36937]]

required to claim searching expenses caused a number of businesses not 
to claim them.
    One commenter was not supportive of the $1,000 alternative search 
expense payment option and believes that most business relocations 
result in search costs in excess of $1,000. This commenter also does 
not find the existing documentation requirement for search expenses to 
be too burdensome and stated the additional option would create more 
complexity in relocation notices and advisory services.
    FHWA Response: FHWA supports displaced persons having flexibilities 
and options, and the opportunity to make informed choices about 
benefits the Uniform Act provides to meet their needs. FHWA also 
supports streamlining efforts that benefit displaced persons and 
funding agencies where possible. As an alternative to Sec.  
24.301(g)(18)(i) reimbursement, the proposed provision at Sec.  
24.301(g)(18)(ii) provides Federal agencies with the option to allow, 
on a project or program wide basis, a one-time alternative searching 
expense payment of $1,000 with little or no documentation. FHWA agrees 
that ``up to'' should be removed from the paragraph, and that 
``little'' documentation be replaced with ``minimal'' documentation 
where applicable.
    FHWA agrees with several comments that stated, in part, that 
businesses sometimes elect not to request reimbursement for search 
costs due to the perceived administrative burden of making the claim. 
The FHWA also agrees with the comments that noted businesses frequently 
incur search costs well above $1,000. FHWA believes that a minimal 
documentation option for search costs addresses both concerns while 
balancing the need for funding agencies to ensure that waste, fraud, 
and abuse do not occur when making Uniform Act payments. This new 
flexibility will reduce administrative burden on both the displaced 
person and the agency. FHWA does not agree that this alternative search 
expense payment option should be increased to a minimum of $2,500. FHWA 
believes that should a displaced person expect to have more than $1,000 
in search costs, they should elect to document those costs in order to 
claim reimbursement for actual, reasonable, and necessary search 
expenses associated with their relocation.
    As a result of the above analysis, FHWA revised Sec.  
24.301(g)(18)(ii) as noted above.

Section 24.301(h)(5) Payment for Actual Reasonable Moving and Related 
Expenses--Ineligible Moving and Related Expenses; Loss of Trained 
Employees

    One commenter requested the inclusion of the cost to train new 
employees as an eligible nonresidential moving cost expense when a move 
to a nonresidential replacement site location results in a loss of 
trained employees. The commenter shared that some businesses relocated 
further away than expected due to lack of availability of suitable 
replacement property, resulting in many businesses losing trained 
employees. Since it is not cost effective to relocate all the 
employees, a suggested alternative to cover training costs of new 
employees could be allowed as an eligible reestablishment or moving 
cost.
    FHWA Response: The loss of trained employees continues in this 
final rule to be an ineligible expense under Sec.  24.301(h)(5); 
however, an agency may request a waiver of the requirement under Sec.  
24.7 from the Federal funding agency, when appropriate.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.302(a) Fixed Payment for Moving Expenses--Residential Moves

    FHWA received two comments related to the Fixed Payment for Moving 
Expenses--Residential Moves. One commenter asked if the proposed change 
means an agency will pay to move items into storage instead of to 
replacement housing with no allowance for moving them out. One 
commenter did not agree with the proposed change as it would limit 
fixed residential move payments to one move, and when storage is deemed 
reasonable and necessary, the displaced person should be entitled to 
two moves; one to put personal property into storage, and again to move 
personal property to their replacement home/rental from storage.
    FHWA Response: FHWA believes the fixed schedule allows for a one-
time self-move but not additional moves from storage. FHWA notes that 
the fixed schedule move is a simplified and streamlined method of 
reimbursement and is predicated on the cost of moving personal property 
from the acquired property. In most cases, the need for storage may 
best be met by using other moving eligibilities that have been provided 
to allow for storage as necessary.
    Agencies should ensure that adequate advisory services are provided 
so that a displaced person can make an informed decision about which 
moving cost eligibility would best meet their needs.
    As a result of the above analysis, FHWA reviewed this section of 
the regulations and has edited the section to improve clarity about the 
requirements. No substantive changes were made to this section of the 
final rule.

Section 24.303(a) Related Nonresidential Eligible Expenses; Connections 
to Utilities at the Replacement Site

    FHWA received three comments in relation to eligible nonresidential 
moving expenses for connection to utilities when the replacement site 
is being developed, or when constructing a new building or structure at 
the replacement site. The commenters asked for clarification of whether 
fees for connecting to local municipal water and sewer infrastructure 
is an eligible expense when the nonresidential displaced person is 
constructing a new building. A commenter also requested clarification 
of whether a new construction site would no longer be eligible for 
utilities to be connected from the right-of-way or property line to a 
newly constructed building as discussed in Sec.  24.303(a) and appendix 
A. This commenter also requests that the regulation specify that 
utility connections are for the operational needs of the business, and 
that appendix A specify whether capital improvements, such as storm 
water improvements, are an eligible expense. One commenter appreciated 
the change for utility installation eligibility from ``nearby'' to 
``from the replacement site's property line,'' while another did not 
based on the belief that this change is too restrictive for 
nonresidential displaced persons and would cause financial hardship.
    FHWA Response: The NPRM's proposed change to this section clarified 
that costs associated with upgrading or installing needed utility 
service from the property line to the structure are eligible costs 
under this part when the agency determines them to be actual, 
reasonable, and necessary. The previous rule was unevenly applied by 
agencies, with some agencies using a liberal interpretation of 
``nearby'' and others being more conservative. Over the years, FHWA 
found that determining what ``nearby'' meant, and consequently what 
costs might be reimbursable, was impractical. FHWA believes that the 
NPRM's proposed change reasonably describes the types of costs that may 
be eligible for reimbursement under this part because it focuses on 
costs incurred on the replacement property and further specifies that 
this section allows for

[[Page 36938]]

only those costs from the property line to the structure. FHWA also 
believes that costs for connecting utilities from the right-of-way line 
to a newly constructed or to be constructed building are neither 
clearly eligible nor ineligible. The regulation and appendix A both 
require an agency to make actual, reasonable, and necessary 
determinations which rely on the individual facts of each case. FHWA 
agrees with commenters' understanding that such a determination 
includes consideration of what costs are essential to the continuing 
operation of the business. FHWA also does not believe that installation 
of storm water management improvements on real property are eligible 
costs as contemplated in Sec. Sec.  24.303(a) or (c) because they are 
neither costs necessary to connect to utilities nor impact fees and 
one-time assessments as described in this section of the regulation. 
The FHWA adopts the NPRM's language as proposed. FHWA may however, 
develop one or more FAQs to respond to additional practical questions 
that are raised during the introduction and implementation of this 
rule.

Section 24.303(c) Related Nonresidential Eligible Expenses; Impact Fees 
or One-Time Assessments for Anticipated Heavy Utility Usage

    FHWA received two comments regarding impact fees or one-time 
assessments for anticipated heavy utility usage. One commenter 
disagrees with limiting eligibility of impact fees or one-time 
assessments for utilities to anticipated heavy utility usage as it may 
discourage business relocation. One commenter asked for clarification 
about whether the fees were reimbursable under this part and noted that 
the fees often can be tens of thousands of dollars or more.
    FHWA Response: FHWA is not making a change in requirements or 
imposing new limits on eligibility for Sec.  24.303(c) reimbursement 
for impact fees or one-time assessments for anticipated heavy utility 
facility service usage such as water, sewer, gas, electric, steam, etc. 
FHWA notes that current Uniform Act, FAQ #75 (https://www.fhwa.dot.gov/real_estate/policy_guidance/uafaqs.cfm) discusses and clarifies 
eligibility for reimbursement of impact fees and one-time assessments 
under this part. FHWA believes that the current policy, as articulated 
in FAQ #75, provides sufficient reimbursement for impact fees or one-
time assessments for anticipated heavy utility facility service usage. 
FHWA also notes that both the NPRM's preamble and appendix A for this 
section provide additional details on impact fees or one-time 
assessments for anticipated heavy utility facility service usage 
eligibility. FHWA will consider developing additional FAQs to further 
clarify the eligibility. FHWA believes providing information on the 
potential eligibility of impact fees for anticipated heavy utility 
usage and increased costs are important advisory services.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.304(b)(5)) Reestablishment Expenses--Nonresidential Moves; 
Ineligible Expenses, New Construction or Reconstruction of a 
Replacement Site Structure

    FHWA received four comments related to reestablishment and moving 
expenses eligibilities for new construction or reconstruction of a 
structure for a nonresidential replacement site. One commenter asked 
for the terms ``substantially construct'' and ``substantially 
reconstruct'' to be defined. One commenter expressed an opinion that 
building out a shell for office space should be approved as part of 
reestablishment when it does not qualify as a reimbursable expense for 
modifying the structure so that personal property can be reconnected. 
One commenter believes there are times when substantial reconstruction 
or building out of a shell is necessary as it relates to personal 
property, such as a dental practice where installation of water and gas 
lines for connection to the dental chairs is necessary. This commenter 
interprets the clarification related to new construction or 
reconstruction of a structure for a nonresidential replacement site as 
too stringent and believes that those costs should be allowed as an 
eligible moving expense.
    FHWA Response: FHWA proposed a new Sec.  24.304(b)(5) in the NPRM 
to clarify that costs to construct or substantially reconstruct a 
building are considered capital expenditures and are generally 
ineligible for reimbursement as a reestablishment expense for a 
nonresidential displacement. The FHWA revised the regulatory language 
and discussion in appendix A in this final rule to more clearly focus 
the discussion of ineligible expenses on construction, reconstruction, 
and rehabilitation of a building. The FHWA removed the terms 
``substantially construct'' and ``substantially reconstruct'' and in 
this final rule uses the terms ``construct,'' ``reconstruct,'' or 
``rehabilitate'' to more clearly focus on ineligible reestablishment 
expenses. FHWA does not believe that it is practical to try to define 
or describe all the scenarios where an agency may determine these costs 
to be ineligible due to the need to ``construct,'' reconstruct,'' or 
``rehabilitate.''
    FHWA believes that construction or reconstruction or rehabilitation 
of a building are usually ineligible expenses; however, there may be 
special cases where construction, reconstruction or rehabilitation may 
be necessary. Such instances usually arise when a replacement building 
suitable for occupancy cannot be found. Eligible costs for making a 
building suitable for occupancy, as discussed in this regulation, may 
require the addition of necessary facilities such as bathrooms, room 
partitions, built-in display cases, and similar items, either because 
they are required by Federal, State, or local codes, ordinances, or 
because the agency determines that such costs are reasonable and 
necessary for the operation of the business. Agencies will need to 
consider eligibility and requests for reimbursement of costs to 
construct, reconstruct, or rehabilitate a building on a case-by-case 
basis and determine whether that eligibility should be requested via a 
Sec.  24.7 waiver of the requirements of Sec.  24.304(b)(5). As 
proposed in the NPRM, FHWA incorporated two current FAQs into a new 
appendix A item with an example of when such a waiver is requested and 
discusses the costs that may be determined eligible for reimbursement 
pursuant to such waiver.

Section 24.305(e); Fixed Payment for Moving Expenses--Nonresidential 
Moves; Average Annual Net Earnings Appendix A

    FHWA received one comment regarding an addition in appendix A Sec.  
24.305(e) expressing support for the expansion of flexibility being 
provided for benefits to businesses in operation for less than 2 full 
years.
    FHWA Response: FHWA believes the revision to appendix A Sec.  
24.305(e) clarifies that a business must only contribute materially to 
the income of the displaced person for a period of time during the 2 
taxable years prior to displacement but does not have to be in 
existence for 2 full years prior to displacement in order to be 
eligible for relocation benefits. FHWA notes that there is no change to 
the definition of ``contributes materially'' or Sec. Sec.  24.305(a)(6) 
and (e), in this final rule, because as currently written, they give 
clear direction for equitable treatment of businesses in operation 
either seasonally or for less than 2 full years, and for calculating a 
prorated benefit payment. FHWA believes the final rule's

[[Page 36939]]

revision to appendix A, Sec.  24.305(e), confirms and supports the 
regulatory allowance that a displaced business may be eligible to 
receive payment for a business that is open for less than 2 full years, 
and provides a more detailed discussion and practical examples of 
calculating benefits for a variety of circumstances, including 
prorating the average annual net earnings of a business or farm 
operation, and sample calculations for businesses with less than 2 full 
years in operation, and seasonally operated businesses.
    As a result of the above analysis, no change was made to appendix 
A.

Subpart E--Replacement Housing Payments

Section 24.402(b) Replacement Housing Payment for 90 Day Tenants and 
Certain Others; Low-Income Rental Replacement Housing Calculations

    FHWA received one comment regarding the determination of whether a 
tenant occupant is determined to have low income for the purpose of the 
rental replacement housing payment calculation based on 30 percent of 
the displaced household's income. The commenter stated that the 
proposed change ties the income calculation to a new index.
    FHWA Response: The NPRM did not include a proposal to change low-
income calculation and determination methodology. The change in the 
NPRM's proposed regulatory text only included a corrected URL reference 
to the U.S. Department of Housing and Urban Development's Annual Survey 
of Income Limits for Public Housing and Section 8 Programs at: 
www.fhwa.dot.gov/real_estate/policy_guidance/low_income_calculations/index.cfm.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.402(b)(2)(i) Replacement Housing Payment for 90 Day Tenants; 
Tenant RHP for Little or No Rent

    One commenter requested that FHWA provide guidance on what 
constitutes ``little rent'' as discussed in Sec.  24.402(b)(2)(i), 
which requires that if a tenant is paying ``little to no rent,'' a fair 
market rent must be determined. The commenter asked for clarification 
of whether ``little rent'' is 50 percent or 25 percent below fair 
market rent for this instance.
    FHWA Response: FHWA does not believe that ``little rent'' can be 
defined in this rule in a way that could reasonably be expected to 
apply to all instances an agency may encounter. However, FHWA believes 
that when little or no rent is paid, the important aspect is not the 
definition of the term, but rather ensuring that the agency establishes 
policies and procedures to ensure that a uniform process exists to make 
that determination. After an agency determines fair market rent and 
establishes base monthly rent, a hardship determination can be made. 
Agencies making the determination would consider whether the use of the 
base monthly rent for the rental replacement housing payment 
calculation would create a hardship for the displaced person. Such 
hardship is discussed in Sec. Sec.  24.402(b)(2)(i) for low income or 
other circumstances.
    FHWA does not believe that changing ``little or no rent'' to ``less 
than fair market rent or no rent'' would resolve the commenter's 
concern. The FHWA agrees that the word ``little'' does not have a 
meaning specific to the regulation; however, it has been used in 
several instances throughout the regulatory history of this part. Over 
that period of time, FHWA has not noted requests for clarifications or 
questions about interpretations on the meaning of ``little rent.'' 
Often, fair market rent is defined within a range of value, so 
determining if the amount of rent being paid is within that range and 
using the amount paid should be appropriate.
    FHWA will prepare an FAQ to provide examples of best practices and 
potential scenarios that may assist an agency in uniformly identifying 
and addressing instances when little rent is paid.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

Section 24.402(b) Replacement Housing Payment for 90 Day Tenants; 
Tenant RHP--Base Monthly Rent, Utilities

    FHWA received four comments about calculating base monthly rent and 
the utility costs portion of that payment. One commenter believes that 
the best method to calculate monthly utility costs are to use the 
actual costs to the owner or tenant at the replacement site. One 
commenter thinks an ``apples to apples'' comparison using either 
estimates or actual bills needs to be made. They pointed out that it 
would be unfair to mix actual vs. estimated costs. Two commenters 
stated that in the event that different utility providers are in use at 
the replacement and the acquired subject property, then the regulations 
should permit the use of an existing methodology available for 
estimating these costs such as the HUD Utility Schedule Model, a tool 
based on a national survey of energy consumption produced by the U.S. 
Energy Information Administration. The commenters believe that such a 
tool is familiar and can be used in the public housing and Section 8 
programs to expedite rental assistance payment calculations. Another 
commenter's preferred method is a utility allowance schedule for a 
city/county that would be used to determine estimated utility payment 
obligations. The commenter believes it is fairer to the tenant and 
allows an apple (displacement) to apples (comparable) to apples 
(replacement) comparison regarding utility costs and consideration of a 
rent/utility cost differential. The commenter expressed concern that 
utility allowance schedules consistently show costs that are lower than 
the actual utility costs tenants pay for their dwellings, and 
consequently they often end up being penalized and receive less rental 
assistance if differing sources for utility costs are used. Another 
commenter expressed the view that the NPRM language requiring actual 
utility costs be used ``to the extent practicable'' in determining the 
base monthly rental at the displacement dwelling is extremely 
burdensome.
    FHWA Response: The NPRM notes that Sec.  24.402(b) charges the 
agency with making the determination of the appropriate method to use 
for determining the estimated average monthly utility costs. The NPRM 
also states the base monthly rental shall be established solely on the 
criteria in Sec.  24.402(b)(2)(i) of this section for persons with 
income exceeding the U.S. Department of Housing and Urban Development's 
Annual Survey of Low Income Limits for Public Housing and Section 8 
Programs ``low income'' limits, or for persons refusing to provide 
appropriate evidence of income, or for persons who are dependents. FHWA 
agrees that, when possible, the use of actual utility costs will 
provide the most accurate basis for calculating eligibility and 
reimbursement. FHWA also recognizes that information or documentation 
of actual costs may not always be available for various reasons. FHWA 
will continue to encourage agency to document, file, and then utilize 
an estimate to develop a base monthly rent at the displacement dwelling 
when documentation of those costs is not available. This final rule 
does not require use of a specific method or source for estimating 
utility costs but encourages each agency to develop policies and 
procedures to ensure uniformity in calculation.
    As a result of the above analysis, no changes were made to this 
section of the final rule.

[[Page 36940]]

Section 24.402(c) Replacement Housing Payment for 90 Day Tenants and 
Certain Others; Tenant RHP--Down Payment Assistance Payment; Less Than 
90-Day Owner Occupant

    FHWA received one comment regarding a down payment assistance 
payment for a less than 90-day owner-occupant. The commenter pointed 
out that the NPRM proposed to add clarifying language to appendix A to 
describe rental assistance payment eligibilities for a displaced 
homeowner who fails to meet the 90-day occupancy requirements, which is 
not in appendix A. Also, the appendix A section only refers to 
displaced homeowners who elect to rent and does not include the 
proposed clarifying language.
    FHWA Response: FHWA revised the language in Sec.  24.402(c) and 
appendix A of this part to include a reference to the last resort 
housing requirements when a displaced person has been in occupancy less 
than 90 days as discussed in Sec.  24.404(c)(3) for such owners and 
tenants.

Section 24.403(a)(1)--Additional Rules Governing Replacement Housing 
Payments--Number of Comparable Dwellings To Be Used and Related 
Inspection Requirements

    One commenter asked about using the same three dwellings for more 
than one replacement housing computation.
    FHWA Response: FHWA believes that considering three or more 
comparable dwellings for a replacement housing computation ensures 
there are several comparable dwellings available for the displaced 
person, and that if the selected comparable is no longer available, 
provides the agency with alternative comparable dwellings that it can 
use to recalculate a displaced person's eligibility. FHWA also notes 
that the requirements of Sec.  24.403(a)(1) were not proposed for 
change in the NPRM. FHWA does agree with the commenter's apparent 
concern about using the same comparable dwellings for several 
displacements and agrees that such a practice is generally inconsistent 
with the requirements of this final rule. Agencies must, at minimum 
require that the comparable dwellings they use are available by 
frequently checking to ensure that the comparable dwellings remain 
available while the displaced person continues their search for a 
replacement dwelling. The final rule will continue to require that at 
least three comparable replacement dwellings be considered and the 
payment computed on the basis of the dwelling most nearly 
representative of, and equal to or better than, the displacement 
dwelling.
    As a result of this analysis, no changes were made to this section 
of the regulation.

Section 24.403(a)(1)--Additional Rules Governing Replacement Housing 
Payments--Inspection Requirements

    One commenter stated that the proposed new appendix A language for 
49 CFR 24.403(a)(1) regarding inspections of comparable replacement 
dwellings for the purposes of computing the cost is extremely unclear 
as to the standards and requirements for DSS inspections under this 
section. Although the proposed language states that ``[r]eliance on an 
exterior visual inspection, or examination of an MLS listing does not, 
in most cases constitute a full DSS inspection,'' the standards for 
what constitutes a full inspection are not stated and also lack a 
description of the proper protocol if the housing unit fails 
inspection.
    FHWA Response: Appendix A at Sec.  24.403(a)(1) explains that the 
purpose and limits of a DSS inspection ``. . . as required by this part 
is a visual inspection to ensure that certain requirements as they 
relate to the definition of DSS in the rule are being met.'' These DSS 
inspections are not the same as a full home inspection that a home 
inspector would be hired to do. 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.
    As a result of this analysis, FHWA has reorganized both this 
section and Sec.  24.205(c)(2)(ii)(C) of appendix A and added language 
to more clearly relate the requirements in the relevant section of the 
regulation and to clarify the sections.

Section 24.403(a)(2) Additional Rules Governing Replacement Housing 
Payments, Carve-Outs and Major Exterior Attributes

    FHWA received one comment requesting additional guidance for 
agencies in addressing major exterior attributes at the residential 
displacement property that are not readily available in comparable 
replacement housing. Examples include, but are not limited to, 
properties that contain more than one dwelling unit and parcels that 
are larger than a typical dwelling site for the area. The commenter 
requested additional guidance for determining the portion of a mixed-
use property that will be attributed to the residential portion of the 
property for the purposes of calculating a replacement housing payment. 
The commenter noted that such determinations are typically referred to 
as ``carve-outs'' in practice, however the words ``carve-out'' never 
actually appear in the Uniform Act. The commenter further asked if the 
residential portion, or the business portion should be carved out from 
a mixed-use property involving relocations. The commenter stated that 
in practice, the value of the property rarely equals the sum of the two 
parts, causing the determination of which part is carved out to 
potentially change the price differential payment significantly. The 
commenter suggested instructions such as those contained in the May/
June 2009 IRWA magazine article titled, ``Residential Carve-Outs, 
Uncovering the Mystery'', by David Leighow, or a well-written FAQ, be 
provided to address this concern.
    FHWA Response: FHWA believes the discussion in Sec.  24.403(a)(2) 
is clear on the requirement that the contributory value of major 
exterior attributes must be subtracted from the acquisition price of 
the displacement dwelling, for purposes of computing the Replacement 
Housing Payment when the comparable dwelling site lacks a major 
exterior attribute. However, FHWA believes that the addition of 
language in this final rule, additional new discussion in appendix A, 
and a few general examples in appendix A will ensure that the users of 
the regulation are able to consistently develop carve-out calculations. 
The agency's first effort should always be to attempt to locate a 
comparable dwelling with the attribute before selecting a dwelling 
without the attribute. The FHWA will also consider revising current FAQ 
#108, https://www.fhwa.dot.gov/real_estate/policy_guidance/uafaqs.cfm, 
which addresses major exterior attributes and or adding an additional 
FAQ, if necessary.

Section 24.403(a)(3) Additional Rules Governing Replacement Housing 
Payments; Acquisition of a Portion of a Typical Residential Property

    FHWA received one comment stating the commenter's preference of 
using the whole displacement property value for computing the 
replacement housing payment.
    FHWA Response: FHWA believes calculation of a replacement housing 
eligibility based on only the portion of the property that the agency 
is acquiring, could cause a substantial increase in a displaced 
person's

[[Page 36941]]

replacement housing eligibility, which may not be necessary to ensure 
the availability of comparable housing. The NPRM proposal, and its 
incorporation into this final rule, allows Federal funding agencies to 
determine when it would be appropriate to make an offer on the entire 
parcel or just the portion needed for the project. FHWA believes that 
agencies should be given the option to offer to purchase the remainder, 
and then calculate the replacement housing eligibility based on the 
purchase offer for the entire parcel.
    FHWA also understands that in some instances, owners may not wish 
to sell the remainder. FHWA believes the changes to Sec.  24.403(a)(3) 
proposed in the NPRM and incorporated in this final rule will allow 
property owners to either retain the remainder or to sell it, depending 
on which option best suits their needs. However, should they elect to 
retain the remainder, they should understand that such an election 
would not require an agency to recalculate the relocation assistance 
eligibility. FHWA believes that when using this option, the agency will 
need to ensure the displaced person is provided advisory services 
explaining that should the displaced person elect to retain the 
remainder, they will be responsible for providing the contributory 
value of the remainder, as determined in the agency's valuation, in 
order to purchase the comparable dwelling or a similar replacement 
dwelling. FHWA included a sample calculation and added language to 
appendix A of Sec.  24.403(a)(3) of this final rule, to clarify when 
and how to apply this calculation method. FHWA believes the two options 
discussed in the regulation and appendix A sections of this part, to 
either include or exclude the contributory of the remainder, provides 
flexibility for the agencies when making a replacement housing 
eligibility calculation. FHWA notes that recipients will need to work 
with the funding agency to document and implement applicable policies 
and procedures.
    As a result of the above analysis, no change was made to this 
section of the final rule.

Sections 24.401(b), 24.402(b) and 24.404; Replacement Housing of Last 
Resort

    FHWA received one comment regarding the monetary limits for 
Replacement Housing Payments. The NPRM states that a replacement 
housing payment ``may not exceed $31,000'' for a 90-day homeowner-
occupant replacement housing payment determination in Sec.  24.401(b), 
or ``shall not exceed $7,200'' for 90-day tenants or certain others 
rental replacement housing payment determination in Sec.  24.402(b). 
The commenter recommends alternatives under Sec.  24.404, Replacement 
Housing of Last Resort, be referenced in Sec. Sec.  24.401(b) and 
24.402(b) to ensure agencies are aware that replacement housing 
payments may exceed these thresholds when circumstances for making the 
replacement housing payment determination meet the requirements of 
Replacement Housing Last Resort.
    FHWA Response: FHWA agrees with the commenter that for 
clarification, additional language should be added to the regulation to 
reference replacement housing of last resort. FHWA modified Sec. Sec.  
24.401(b) and 24.402(b) to include a reference to Sec.  24.404, 
Replacement Housing of Last Resort, to ensure the applicable provisions 
are applied when costs related to a replacement housing payment 
determination will exceed the otherwise prescribed thresholds.

Subpart F--Mobile Homes

    FHWA received various comments, suggestions, and statements from 
two commenters on methods to streamline this section of the regulation. 
One commenter is supportive of continuing the two-part benefit 
determination process for persons displaced from their mobile home. 
This same commenter stated that the proposed dwelling test would reduce 
benefits for low-income displaced persons and would also create 
significant challenges in locations with limited mobile home options. 
One commenter believes the existing provisions of the rule pertaining 
to mobile homes should not be reorganized or streamlined, as doing so 
is likely to risk undermining the attributes of the present rule. This 
same commenter described the current rule's method of calculating the 
replacement housing payments for mobile home occupants as rational, as 
they provide much-needed, appropriate protections for displaced mobile 
home occupants and are not difficult to implement. This same commenter 
believes appendix A only clarifies the definition of mobile home with 
regard to allowable types of replacement housing, and all other 
requirements contained in the definition should be removed from 
appendix A because they impose barriers on displaced recreational 
vehicle residents' Uniform Act eligibilities. This same commenter 
suggests changing the definition of mobile home in Sec.  24.2(a) to 
include manufactured homes and recreational vehicles used as primary 
residences.
    FHWA Response: FHWA appreciates the support expressed for the 
current Subpart F mobile home regulations, the reasoning regarding 
streamlining, the definition of mobile home, and the dwelling test. 
FHWA believes the requirements for comparable replacement housing apply 
to all types of replacement dwellings. The NPRM explains that 
identification of comparable dwellings for a person displaced from a 
mobile home need not be restricted to another mobile home as a matter 
of policy or practice. Dwellings, other than those defined as mobile 
homes, may be used when selecting comparable replacement housing for 
calculating a replacement housing payment. FHWA notes the one change 
discussed in the NPRM and incorporated in this final rule is to Sec.  
24.502(c) for determining base monthly rent. It clarifies that the 
actual cost paid to the landlord for the site will be used, except 
market rent is to be used when little or no rent is paid for renting 
the site. FHWA also believes appendix A discusses the DSS requirements 
for comparable and replacement mobile homes. Removal of this discussion 
would be detrimental to the protections being provided to displaced 
persons because they explain, in part, minimum requirements for non-
standard replacement dwellings selected by the displaced persons.
    FHWA revised the definitions sections in this final rule to include 
the term ``manufactured home'' and a reference to the regulations at 24 
CFR 3280.2. This revised definition includes the term ``mobile 
home''.\3\ The appendix A discussion for this definition has similarly 
been reorganized for clarity. This regulation will continue to use the 
term ``mobile home'' for purposes of clarity and consistency.
---------------------------------------------------------------------------

    \3\ HUD regulates safety and design features for manufactured 
homes, including but not limited to mobile homes. Under Federal law 
governing safety and design of manufactured homes and for HUD 
programs and projects, the term ``manufactured home'' is used as 
found in regulation at 24 CFR 3280.3. (See 42 U.S.C. 5401 et seq.)
---------------------------------------------------------------------------

Rulemaking Analyses and Notices

Executive Order 12866 (Regulatory Planning and Review), Executive Order 
13563 (Improving Regulation and Regulatory Review), and DOT Regulatory 
Policies and Procedures

    The Office of Management and Budget (OMB) has determined that this 
rulemaking would be a significant regulatory action within the meaning 
of Executive Order (E.O.) 12866 (as amended by E.O. 14094 ``Modernizing 
Regulatory Review''). However, the rulemaking is not economically 
significant for purposes of E.O. 12866. The rule will not have an 
annual effect

[[Page 36942]]

on the economy of $200 million or more. The rule will not adversely 
affect in a material way the economy, any sector of the economy, 
productivity, competition, or jobs. In addition, the changes would not 
materially alter the budgetary impact of any entitlements, grants, user 
fees, or loan programs.
    A more detailed discussion of the economic analysis associated with 
this rulemaking can be found in the RIA, which is available in the 
docket. The RIA is largely similar to the regulatory evaluation of the 
NPRM. However, it has been revised to reflect changes in the final rule 
and to update the analysis given the time passed since the analysis 
conducted for the NPRM. The FHWA did not receive any public comments 
directly related to the RIA during the NPRM comment period.
    The costs of the final rule over 10 years for all Uniform Act 
agencies are estimated to be $2.2 million when discounted at 7 percent 
and $2.4 million when discounted at 3 percent. The annualized costs are 
estimated to be $311,000 per year when discounted at 7 percent and 
$283,000 per year when discounted at 3 percent. The larger impact of 
this final rule is in the form of transfers from the Government to 
property owners whose real estate is acquired for Federal projects. The 
estimated amount of transfers for the Government-wide program over the 
10-year analysis period resulting from this rule are estimated to be 
$169.5 million when discounted at 7 percent and $214.6 million when 
discounted at 3 percent, or roughly $24.1 million per year when 
annualized at 7 percent or $25.2 million per year when annualized at 3 
percent. This rule can therefore be thought of as predominantly a 
transfer rule, as the estimated costs are significantly smaller than 
the estimated transfers. FHWA was the only agency that provided data 
upon which to base estimates of the transfers. Therefore, the magnitude 
of the change in transfers for all Federal agencies may be somewhat 
larger than is estimated here.
    The bulk of the estimated costs are related to updating program 
materials to reflect the changes in the final rule. In addition, some 
smaller recipient and Federal agency administrative cost savings have 
been estimated.\4\ Again, FHWA was the only agency that had a detailed 
data set available for its Uniform Act program, and therefore only the 
administrative cost savings to FHWA have been estimated here. Based on 
communications with other Uniform Act agencies, FHWA analysts believe 
that FHWA has the largest Uniform Act program; however, other agencies 
have sizable programs as well. Therefore, the total cost savings across 
all agencies will likely be larger.
---------------------------------------------------------------------------

    \4\ A recipient is the direct recipient of Federal program 
funds, is not a Federal agency and is accountable to the Federal 
funding agency for the use of the funds and for compliance with 
applicable Federal requirements.
---------------------------------------------------------------------------

    The benefits of the final rule primarily relate to improved equity 
and fairness to entities that are displaced from their properties or 
that move as a result of projects receiving Federal funds. For example, 
the final rule raises the statutory maximums for payments to displaced 
entities to assist with the reestablishment of the business, farm, or 
nonprofit organization. There is strong evidence that entities 
experience reestablishment costs well above the current maximum amount. 
Raising the maximum payment levels would compensate those entities more 
fairly and equitably for the negative impacts they experience as a 
result of a Federal or federally assisted project. However, the 
fairness and equity benefits of the final rule cannot be quantified or 
monetized. The higher level of payments may also contribute to more 
entities being able to successfully reestablish after displacement.
    The final rule contains changes, such as a requirement for annual 
reporting, that can be expected to improve transparency, and, 
therefore, oversight of the program. Again, that benefit is not 
quantified or monetized in the analysis.
    The table below offers a summary of the costs and benefits of the 
final rule over the 10-year analysis period. Given that the benefits of 
the rule related to equity and fairness have not been quantified, it 
would be misleading to report a calculation of net benefits for this 
final rule. Nonetheless, the benefits related to equity and fairness 
are believed to be sufficient to justify the cost of the final 
rule.5 6
---------------------------------------------------------------------------

    \5\ These estimates are an upper bound estimate, based on the 
maximum amount that program expenditures could increase based on the 
final rule's changes in maximum reimbursement amounts.
    \6\ There may be additional increases in search expense due to 
the final rule's inclusion of attorney's fees as a category of 
reimbursement.

                      Table 1--Summary of Costs and Benefits for Analysis Period 2023-2032
----------------------------------------------------------------------------------------------------------------
                  Item                      Discounted 7%     Discounted 3%     Annualized 7%     Annualized 3%
----------------------------------------------------------------------------------------------------------------
Costs:
    Reverse Mortgages...................           $29,046           $36,647            $4,136            $4,296
    Revising Program Materials..........         2,216,271         2,451,123           315,547           287,346
    Federal agency Reporting Requirement           184,582           232,883            26,280            27,301
Cost Savings:
    Revising Max. RHP/RAP (FHWA Only)...         (235,772)         (300,627)          (33,569)          (35,243)
    Homeowner 90 Day Eligibility (FHWA             (7,286)           (9,193)           (1,037)           (1,078)
     Only)..............................
    Appraisal Waivers...................    Not Quantified    Not Quantified    Not Quantified    Not Quantified
    Third Tier of Waiver Valuations.....    Not Quantified    Not Quantified    Not Quantified    Not Quantified
    Use of Single Agents................    Not Quantified    Not Quantified    Not Quantified    Not Quantified
    Inspection of Comparable Housing....    Not Quantified    Not Quantified    Not Quantified    Not Quantified
    Other Clarity & Streamlining Changes    Not Quantified    Not Quantified    Not Quantified    Not Quantified
                                         -----------------------------------------------------------------------
        Total Costs *...................         2,186,841         2,410,833           311,357           282,623
Benefits:
    Equity & Fairness...................    Not Quantified    Not Quantified    Not Quantified    Not Quantified
    Program Oversight...................    Not Quantified    Not Quantified    Not Quantified    Not Quantified
----------------------------------------------------------------------------------------------------------------


[[Page 36943]]


                  Table 2--Transfers to Displaced Persons for Analysis Period 2023-2032 (FHWA)
----------------------------------------------------------------------------------------------------------------
                  Item                      Discounted 7%     Discounted 3%     Annualized 7%     Annualized 3%
----------------------------------------------------------------------------------------------------------------
Residential displaced persons:
    Revising Max. RHP/RAP...............                $0                $0                $0                $0
    Homeowner 90-day Eligibility \5\....         1,770,513         2,231,474           252,081           261,597
    Reverse Mortgages...................    Not Quantified    Not Quantified    Not Quantified    Not Quantified
    Rental Application and Credit Check          2,239,669         2,825,733           318,879           331,262
     Fees...............................
Nonresidential Displaced Persons:
    Reimbursement for Updating Other        Not Quantified    Not Quantified    Not Quantified    Not Quantified
     Media..............................
    Search Expenses \6\.................         8,072,686        10,257,668         1,149,369         1,202,512
    Re-Establishment Expenses...........       125,461,485       158,817,606        17,862,893        18,618,268
    Fixed Payments In-Lieu-Of Moving            31,997,535        40,514,920         4,555,729         4,749,585
     Expenses...........................
                                         -----------------------------------------------------------------------
        Total...........................       169,541,889       214,647,402        24,138,951        25,163,224
----------------------------------------------------------------------------------------------------------------
* Totals may not match sums due to rounding.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (Pub. L. 96-354, 
5 U.S.C. 601-612), FHWA has evaluated the effects of this rule on small 
entities and has determined that it is not anticipated to have a 
significant economic impact on a substantial number of small entities, 
which includes State DOTs, Local Public agencies, other State 
governmental agencies or recipients and subrecipients of Federal 
agencies subject to this regulation. This action updates the 
Government-wide regulation that provides assistance for persons, 
including small businesses, displaced by Government acquisition of real 
property. One of the reasons for this rulemaking is to increase 
assistance for the small number of displaced small businesses impacted 
by the Uniform Act. The FHWA has determined this rulemaking would have 
a positive impact on those relatively few small businesses that are 
affected by Government acquisition of real property. Financial impacts 
on local governments are mitigated by the fact that any increased costs 
would accrue only on federally assisted programs, which would include 
participation of Federal funds. For these reasons, FHWA certifies that 
the rule will not have a significant economic impact on a substantial 
number of small entities.

Unfunded Mandates Reform Act of 1995

    This rule would not impose unfunded mandates as defined by the 
Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4, 109 Stat. 48). 
This rule would not result in the expenditure by State, local, and 
Tribal governments, in the aggregate, or by the private sector, of $168 
million or more in any one year (2 U.S.C. 1532). In addition, the 
definition of ``Federal Mandate'' in the Unfunded Mandates Reform Act 
excludes financial assistance of the type in which State, local, or 
Tribal governments have authority to adjust their participation in the 
program in accordance with changes made in the program by the Federal 
Government.

Executive Order 13132 (Federalism Assessment)

    This rule has been analyzed in accordance with the principles and 
criteria contained in E.O. 13132, ``Federalism'' 64 FR 43255 (Aug. 10, 
1999), and FHWA has determined that this rule would not have sufficient 
federalism implications to warrant the preparation of a federalism 
assessment. The FHWA has also determined that this action would not 
preempt any State law or State regulation or affect any State's ability 
to discharge traditional State government functions.

Paperwork Reduction Act of 1995

    Under the Paperwork Reduction Act of 1995 (PRA) (44 U.S.C. 3501, et 
seq.), Federal agencies must obtain approval from the OMB for 
collections of information they conduct, sponsor, or require through 
regulations. The PRA applies to Federal agencies' collections of 
information imposed on 10 or more persons. ``Persons'' include a State, 
territorial, tribal, or local government, or branch thereof, or their 
political subdivisions.
    This final rule would call for a collection of information under 
the PRA. As defined in 5 CFR 1320.3(c), ``collection of information'' 
comprised of reporting, recordkeeping, monitoring, posting, labeling, 
and other similar actions. This action contains amendments to the 
existing information collection requirements previously approved under 
OMB Control Number 2125-0586. The title and description of the 
information collection, a description of those who must collect the 
information, and an estimate of the total annual burden follow and are 
outlined in full in the RIA contained in the docket for this 
rulemaking.
    The Uniform Act provides important protections and assistance for 
people affected by federally funded projects. Congress passed the law 
to safeguard people whose real property is acquired or who move from 
their homes, businesses, nonprofit organizations, or farms as a result 
of projects receiving Federal financial assistance. MAP-21 modified the 
statutory payment levels for which displaced persons may be eligible 
under the Uniform Act's implementing regulations, necessitating the 
current proposed rulemaking. In addition, FHWA is making changes to 
wording and section organization in this final rule to better reflect 
the Federal experience implementing Uniform Act programs.
    This requirement amends an existing collection of information by 
increasing the number of instances requiring information to be 
collected under OMB control number 2125-0586. The burden hours reserved 
under these requirements are not sufficient to cover the additional in-
depth updates resulting from regulatory revisions in this final rule.
    Agencies conducting a program or project under the Uniform Act must 
carry out their legal responsibilities to affected property owners and 
displaced persons. Recipients and subrecipients must collect 
information in order to determine, document, and provide Uniform Act 
benefits and assistance. Federal agencies are also required to develop 
and provide to the Lead Agency, FHWA, an annual summary report that 
describes the Uniform Act activities conducted by the Federal agency 
and their funding recipients.
    FHWA does not have available to it information that would allow for 
the calculation of burden hours for each Federal agency's 
administration and oversight of the Government-wide program. Each 
Federal agency will

[[Page 36944]]

separately develop information collection requests for their program's 
administration and oversight. FHWA has developed a separate regulatory 
impact analysis which documents the costs for its program 
administration and oversight. That analysis is available in the docket 
for this rulemaking.
    FHWA can estimate the one-time Government-wide cost of implementing 
the new provisions of this rule to be 37,800 hours. This estimate 
includes costs and benefits for the necessary updates and revisions to 
program materials including operations manuals. FHWA bases this 
estimate on approximately 168 respondents' efforts to perform the 
necessary updates and revisions. The estimated burden hours are for a 
one-time update and result from the publication of a final rule.
    A notice seeking public comments on the collection of information 
was included in the NPRM published in the Federal Register on Wednesday 
December 18, 2019, at 84 FR 69466. No comments on the information 
collection were received.
    The FHWA is required to submit this collection of information 
request to OMB for review and approval.

National Environmental Policy Act

    FHWA has analyzed this rule pursuant to NEPA (42 U.S.C. 4321 et 
seq.) and has determined that it is categorically excluded under 23 CFR 
771.117(c)(20), which applies to the promulgation of rules, 
regulations, and directives. Categorically excluded actions meet the 
criteria for categorical exclusions under the Council on Environmental 
Quality regulations and under 23 CFR 771.117(a) and normally do not 
require any further NEPA approvals by FHWA. This regulation provides 
the policies, procedures, and requirements for acquisition of real 
property interests for Federal and federally assisted projects. This 
action has no potential for environmental impacts until the regulations 
are applied at the project level. The FHWA would have an obligation to 
evaluate the potential environmental impacts of such a future project-
level action if the action constitutes a major Federal action under 
NEPA.
    This action qualifies for categorical exclusions under 23 CFR 
771.117(c)(20) (promulgation of rules, regulations, and directives) and 
771.117(c)(1) (activities that do not lead directly to construction). 
FHWA has evaluated whether the action would involve unusual 
circumstances or extraordinary circumstances and has determined that 
this proposed action would not involve such circumstances. As a result, 
FHWA finds that this rulemaking would not result in significant impacts 
on the human environment.

Executive Order 13175 (Tribal Consultation)

    FHWA has analyzed this rule in accordance with the principles and 
criteria contained in E.O. 13175, ``Consultation and Coordination with 
Indian Tribal Governments'' 65 FR 67249 (Nov. 9, 2000). This measure 
applies to States that receive Title 23, U.S.C. Federal-aid highway 
funds, and it would not have substantial direct effects on one or more 
Indian Tribes, would not impose substantial direct compliance costs on 
Indian Tribal governments, and would not preempt Tribal laws. 
Accordingly, the funding and consultation requirements of E.O. 13175 do 
not apply and a Tribal summary impact statement is not required.

Executive Order 12898 (Environmental Justice)

    The E.O. 12898, ``Federal Actions to Address Environmental Justice 
in Minority Populations and Low-Income Populations'' 59 FR 7629 (Feb. 
16, 1994), requires that each Federal agency make achieving 
environmental justice part of its mission by identifying and 
addressing, as appropriate, disproportionately high and adverse human 
health or environmental effects of its programs, policies, and 
activities on minorities and low-income populations. FHWA has 
determined that this rule does not raise any environmental justice 
issues. The regulations would not cause disproportionately high and 
adverse human health and environmental effects on minority or low-
income populations. The regulations establish procedures and 
requirements for agencies and others when acquiring, managing, and 
disposing of real property interests. The environmental justice 
principles, in the context of acquisition, management, and disposition 
of real property, should be considered during the planning and 
environmental review process for the particular proposal. FHWA will 
consider environmental justice when it makes a future funding or other 
approval decision on a project-level basis.

Regulation Identifier Number (RIN)

    A RIN is assigned to each regulatory action listed in the Unified 
Agenda of Federal Regulations. The Regulatory Information Service 
Center publishes the Unified Agenda in the spring and fall of each 
year. The RIN contained in the heading of this document can be used to 
cross reference this action with the Unified Agenda.

List of Subjects in 49 CFR Part 24

    Appraisal, Appraisal review, Just compensation, Real property 
acquisition, Relocation assistance, Reporting and recordkeeping 
requirements, Transportation, Waiver valuations.

    Issued under authority delegated in 49 CFR 1.81 and 1.85:
Shailen P. Bhatt,
Administrator, Federal Highway Administration.

0
In consideration of the foregoing, FHWA revises 49 CFR part 24, to read 
as follows:

PART 24--UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY 
ACQUISITION FOR FEDERAL AND FEDERALLY ASSISTED PROGRAMS

Subpart A--General
Sec.
24.1 Purpose.
24.2 Definitions and acronyms.
24.3 No duplication of payments.
24.4 Assurances, monitoring, and corrective action.
24.5 Manner of notices and electronic signatures.
24.6 Administration of jointly-funded projects.
24.7 Federal agency waiver of regulations in this part.
24.8 Compliance with other laws and regulations.
24.9 Recordkeeping and reports.
24.10 Appeals.
24.11 Adjustments of limits and payments.
Subpart B--Real Property Acquisition
Sec.
24.101 Applicability of acquisition requirements.
24.102 Basic acquisition policies.
24.103 Criteria for appraisals.
24.104 Review of appraisals.
24.105 Acquisition of tenant-owned improvements.
24.106 Expenses incidental to transfer of title to the agency.
24.107 Certain litigation expenses.
24.108 Donations.
Subpart C--General Relocation Requirements
Sec.
24.201 Purpose.
24.202 Applicability.
24.203 Relocation notices.
24.204 Availability of comparable replacement dwelling before 
displacement.
24.205 Relocation planning, advisory services, and coordination.
24.206 Eviction for cause.
24.207 General requirements--claims for relocation payments.
24.208 Aliens not lawfully present in the United States.

[[Page 36945]]

24.209 Relocation payments not considered as income.
Subpart D--Payments for Moving and Related Expenses
Sec.
24.301 Payment for actual reasonable moving and related expenses.
24.302 Fixed payment for moving expenses--residential moves.
24.303 Related nonresidential eligible expenses.
24.304 Reestablishment expenses--nonresidential moves.
24.305 Fixed payment for moving expenses--nonresidential moves.
24.306 Discretionary utility relocation payments.
Subpart E--Replacement Housing Payments
Sec.
24.401 Replacement housing payment for 90-day homeowner-occupants.
24.402 Replacement housing payment for 90-day tenants and certain 
others.
24.403 Additional rules governing replacement housing payments.
24.404 Replacement housing of last resort.
Subpart F--Mobile Homes
Sec.
24.501 Applicability.
24.502 Replacement housing payment for a 90-day mobile homeowner 
displaced from mobile home.
24.503 Rental assistance payment for 90-day mobile home tenants and 
certain others.
Subpart G--Certification
Sec.
24.601 Purpose.
24.602 Certification application.
24.603 Monitoring and corrective action.
Appendix A to Part 24--Additional Information
Appendix B to Part 24--Statistical Report Form

    Authority:  42 U.S.C. 4601 et seq.; 49 CFR 1.85.

PART 24--UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY 
ACQUISITION FOR FEDERAL AND FEDERALLY ASSISTED PROGRAMS

Subpart A--General


Sec.  24.1  Purpose.

    The purpose of this part is to promulgate rules to implement the 
Uniform Relocation Assistance and Real Property Acquisition Policies 
Act of 1970, as amended (42 U.S.C. 4601 et seq.) (Uniform Act), in 
accordance with the following objectives:
    (a) To ensure that owners of real property to be acquired for 
Federal and federally assisted projects are treated fairly and 
consistently, to encourage and expedite acquisition by agreements with 
such owners, to minimize litigation and relieve congestion in the 
courts, and to promote public confidence in Federal and federally 
assisted land acquisition programs;
    (b) To ensure that persons displaced as a direct result of Federal 
or federally assisted projects are treated fairly, consistently, and 
equitably so that such displaced persons will not suffer 
disproportionate injuries as a result of projects designed for the 
benefit of the public as a whole; and
    (c) To ensure that agencies implement the regulations in this part 
in a manner that is efficient and cost effective.


Sec.  24.2  Definitions and acronyms.

    (a) Definitions. Unless otherwise noted, the following terms used 
in this part shall be understood as defined in this section:
    Agency means any entity utilizing Federal funds or Federal 
financial assistance for a project or program that acquires real 
property or displaces a person.
    (i) Federal agency means any department, agency, or instrumentality 
in the executive branch of the United States Government, any wholly 
owned U.S. Government corporation, the Architect of the Capitol, the 
Federal Reserve Banks and branches thereof, and any person who has the 
authority to acquire property by eminent domain under Federal law.
    (ii) State agency means any department, agency, or instrumentality 
of a State or of a political subdivision of a State, any department, 
agency, or instrumentality of two or more States or of two or more 
political subdivisions of a State or States, and any person who has the 
authority to acquire property by eminent domain under State law.
    Alien not lawfully present in the United States means an alien who 
is not ``lawfully present'' in the United States as defined in 8 CFR 
103.12 and includes:
    (i) An alien present in the United States who has not been admitted 
or paroled into the United States pursuant to the Immigration and 
Nationality Act (8 U.S.C. 1101 et seq.) and whose stay in the United 
States has not been authorized by the U.S. Secretary of Homeland 
Security; and
    (ii) An alien who is present in the United States after the 
expiration of the period of stay authorized by the U.S. Secretary of 
Homeland Security or who otherwise violates the terms and conditions of 
admission, parole, or authorization to stay in the United States.
    Appraisal means a written statement independently and impartially 
prepared by a qualified appraiser setting forth an opinion of defined 
value of an adequately described property as of a specific date, 
supported by the presentation and analysis of relevant market 
information.
    Business means any lawful activity, except a farm operation, that 
is conducted:
    (i) Primarily for the purchase, sale, lease, and/or rental of 
personal and/or real property, and/or for the manufacture, processing, 
and/or marketing of products, commodities, and/or any other personal 
property;
    (ii) Primarily for the sale of services to the public;
    (iii) Primarily for outdoor advertising display purposes, when the 
display must be moved as a result of the project; or
    (iv) By a nonprofit organization that has established its nonprofit 
status under applicable Federal or State law.
    Citizen for purposes of this part includes both citizens of the 
United States and noncitizen nationals.
    Comparable replacement dwelling means a dwelling which is:
    (i) Decent, safe, and sanitary as described in the definition of 
decent, safe, and sanitary in this paragraph (a);
    (ii) Functionally equivalent to the displacement dwelling. The term 
functionally equivalent means that it performs the same function and 
provides the same utility. While a comparable replacement dwelling need 
not possess every feature of the displacement dwelling, the principal 
features must be present. Generally, functional equivalency is an 
objective standard, reflecting the range of purposes for which the 
various physical features of a dwelling may be used. However, in 
determining whether a replacement dwelling is functionally equivalent 
to the displacement dwelling, the agency may consider reasonable trade-
offs for specific features when the replacement unit is equal to or 
better than the displacement dwelling (see appendix A of this part, 
Section 24.2(a) Comparable replacement dwelling);
    (iii) Adequate in size to accommodate the occupants;
    (iv) In an area not subject to unreasonable adverse environmental 
conditions;
    (v) In a location generally not less desirable than the location of 
the displaced person's dwelling with respect to public utilities and 
commercial and public facilities, and reasonably accessible to the 
person's place of employment;
    (vi) On a site that is typical in size for residential development 
with normal site improvements, including customary landscaping. The 
site need not include

[[Page 36946]]

special improvements such as outbuildings, swimming pools, or 
greenhouses. (See also Sec.  24.403(a)(2));
    (vii) Currently available to the displaced person on the private 
market except as provided in paragraph (ix) of this definition (see 
appendix A to this part, Section 24.2(a), definition of comparable 
replacement dwelling); and
    (viii) Within the financial means of the displaced person:
    (A) A replacement dwelling purchased by a homeowner in occupancy at 
the displacement dwelling for at least 90 days prior to initiation of 
negotiations (90-day homeowner) is considered to be within the 
homeowner's financial means if the homeowner will receive the full 
price differential as described in Sec.  24.401(c), all increased 
mortgage interest costs as described at Sec.  24.401(d) and all 
incidental expenses as described at Sec.  24.401(f), plus any 
additional amount required to be paid under Sec.  24.404.
    (B) A replacement dwelling rented by an eligible displaced person 
is considered to be within his or her financial means if, after 
receiving rental assistance under this part, the person's monthly rent 
and estimated average monthly utility costs for the replacement 
dwelling do not exceed the person's base monthly rental for the 
displacement dwelling as described at Sec.  24.402(b)(2).
    (C) For a displaced person who is not eligible to receive a 
replacement housing payment because of the person's failure to meet 
length-of-occupancy requirements, comparable replacement rental housing 
is considered to be within the person's financial means if an agency 
pays that portion of the monthly housing costs of a replacement 
dwelling which exceeds the person's base monthly rent for the 
displacement dwelling as described in Sec.  24.402(b)(2). Such rental 
assistance must be paid under Sec.  24.404.
    (ix) For a person receiving Government housing assistance before 
displacement, a dwelling that may reflect similar Government housing 
assistance. In such cases any requirements of the Government housing 
assistance program, including fair housing, civil rights, and those 
relating to the size of the replacement dwelling, shall apply. 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, subject to the eligibility requirements of the Government 
housing assistance program. An agency is obligated to inform the person 
of his or her options under this part and the implications of accepting 
a different form of assistance than the assistance that the person may 
currently be receiving. If a person accepts assistance under a 
Government housing assistance program, the rules of that program apply, 
and the rental assistance payment under Sec.  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 housing assistance has been applied. In determining 
comparability of housing under this part:
    (A) A public housing unit may qualify as a comparable replacement 
dwelling only for a person displaced from a public housing unit.
    (B) A privately owned unit with a housing project--based rental 
program subsidy (e.g., tied to the unit or building) may qualify as a 
comparable replacement dwelling only for a person displaced from a 
similarly subsidized unit or public housing unit.
    (C) An offer for tenant-based rental assistance, such as a HUD 
Section 8 Housing Choice Voucher, may be provided along with an offer 
of a comparable replacement dwelling to a person receiving a similar 
subsidy assistance or occupying a privately owned subsidized unit or 
public housing unit before displacement. The displacing agency must 
confirm that the owner will accept tenant based rental assistance 
before offering the unit as comparable replacement housing. (see 
appendix A to this part, section 24.2(a), definition of comparable 
replacement dwelling)
    Contribute materially means that during the 2 taxable years prior 
to the taxable year in which displacement occurs, or during such other 
period as the agency determines to be more equitable, a business or 
farm operation:
    (i) Had average annual gross receipts of at least $5,000; or
    (ii) Had average annual net earnings of at least $1,000; or
    (iii) Contributed at least 33\1/3\ percent of the owner's or 
operator's average annual gross income from all sources.
    (iv) If the application of the above criteria creates an inequity 
or hardship in any given case, the agency may approve the use of other 
criteria as determined appropriate. (See appendix A of this part, 
section 24.305(e))
    Decent, safe, and sanitary (DSS) dwelling means a dwelling which 
meets the requirements of paragraphs (i) through (vii) of this 
definition or the most stringent of the local housing code, Federal 
agency regulations, or the agency's regulations or written policy. The 
DSS dwelling shall:
    (i) Be structurally sound, weather tight, and in good repair;
    (A) Many local housing and occupancy codes require 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;
    (B) [Reserved]
    (ii) Contain a safe electrical wiring system adequate for lighting 
and other devices;
    (iii) Contain a heating system capable of sustaining a healthful 
temperature (of approximately 70 degrees) for a displaced person, 
except in those areas where local climatic conditions do not require 
such a system;
    (iv) Be adequate in size with respect to the number of rooms and 
area of living space needed to accommodate the displaced person. The 
number of persons occupying each habitable room used for sleeping 
purposes shall not exceed that permitted by the most stringent of the 
local housing code, Federal agency regulations or requirements, or the 
agency's regulations or written policy. In addition, the Federal 
funding agency shall follow the requirements for separate bedrooms for 
children of the opposite gender included in local housing codes or in 
the absence of local codes, the policies of such agencies;
    (v) There shall be a separate, well lighted and ventilated bathroom 
that provides privacy to the user and contains a sink, bathtub, or 
shower stall, and a toilet, all in good working order and properly 
connected to appropriate sources of water and to a sewage drainage 
system. When required by local code standards for residential 
occupancy, there shall be a kitchen area that contains a fully usable 
sink, properly connected to potable hot and cold water and to a sewage 
drainage system, and adequate space and utility service connections for 
a stove and refrigerator (see appendix A to this part, section 24.2(a), 
definition of DSS);
    (vi) Contains unobstructed egress to safe, open space at ground 
level; and
    (vii) For a displaced person with a disability, be free of any 
barriers which would preclude reasonable ingress, egress, or use of the 
dwelling by such displaced person. (See appendix A of this part, 
Section 24.2(a), definition of DSS)
    Displaced person means:
    (i) Generally. Except as provided in paragraph (ii) of this 
definition, any person who permanently moves from the real property or 
moves his or her

[[Page 36947]]

personal property from the real property. (This includes a person who 
occupies the real property prior to its acquisition, but who does not 
meet the length of occupancy requirements of the Uniform Act as 
described at Sec. Sec.  24.401(a) and 24.402(a).)
    (A) As a direct result of a written notice of intent to acquire, 
rehabilitate, and/or demolish (see Sec.  24.203(d)), the initiation of 
negotiations for, or the acquisition of, such real property in whole or 
in part for a project;
    (B) As a direct result of rehabilitation or demolition for a 
project; or
    (C) As a direct result of a written notice of intent to acquire, or 
the acquisition, rehabilitation or demolition of, in whole or in part, 
other real property on which the person conducts a business or farm 
operation, for a project. However, eligibility for such person under 
this paragraph (i)(C) applies only for purposes of obtaining relocation 
assistance advisory services under Sec.  24.205(c), and moving expenses 
under Sec.  24.301, Sec.  24.302, or Sec.  24.303.
    (ii) Persons required to move temporarily. A person who is required 
to move or moves his or her personal property from the real property as 
a direct result of the project but is not required to relocate 
permanently. Such determination shall be made by the agency in 
accordance with any requirement, policy, or guidance established by the 
Federal agency funding the project (see appendix A to this part, 
section 24.2(a)). All benefits for persons required to move on a 
temporary basis are described in Sec.  24.202(a).
    (iii) Voluntary acquisitions. A tenant who moves as a direct result 
of a voluntary acquisition as described in Sec.  24.101(b)(1) through 
(3) is eligible for relocation assistance when there is a binding 
written agreement between the agency and the owner that obligates the 
agency, without further election, to purchase the real property. 
Federal Funding agencies should develop policies identifying the types 
of agreements used in its programs or projects which it considers to be 
binding and which would therefore trigger eligibility for tenants as 
displaced persons. Agreements such as options to purchase and 
conditional purchase and sale agreements are not considered a binding 
agreement within the meaning of this paragraph (iii) until all 
conditions to the agency's obligation to purchase the real property 
have been satisfied. Provided that, the agency may determine that a 
tenant who moves before there is a binding agreement is eligible for 
relocation assistance once a binding agreement exists allowing 
establishment of eligibility (see appendix A to this part, section 
24.2(a)).
    (iv) Persons not displaced. The following is a nonexclusive listing 
of persons who do not qualify as displaced persons under this part:
    (A) A person who moves before the initiation of negotiations (see 
Sec.  24.403(d)), unless the agency determines that the person was 
displaced as a direct result of the program or project;
    (B) A person who initially enters into occupancy of the property 
after the date of its acquisition for the project;
    (C) A person who has occupied the property for the purpose of 
obtaining assistance under the Uniform Act;
    (D) An owner-occupant who moves as a result of an acquisition of 
real property as described in Sec.  24.101(a)(2) or (b)(1) or (2), or 
as a result of the rehabilitation or demolition of the real property. 
(However, the displacement of a tenant as a direct result of any 
acquisition, rehabilitation, or demolition for a Federal or federally 
assisted project is subject to this part.);
    (E) A person whom the agency determines is not displaced as a 
direct result of a partial acquisition;
    (F) A person who, after receiving a notice of relocation 
eligibility (described at Sec.  24.203(b)), is notified in writing that 
he or she will not be displaced for a project. Such written 
notification shall not be issued unless the person has not moved and 
the agency agrees to reimburse the person for any expenses incurred to 
satisfy any binding contractual relocation obligations entered into 
after the effective date of the notice of relocation eligibility;
    (G) An owner-occupant who conveys his or her property, as described 
in Sec.  24.101(a)(2) or (b)(1) or (2), after being informed in writing 
that if a mutually satisfactory agreement on terms of the conveyance 
cannot be reached, the agency will not acquire the property. In such 
cases, however, any resulting displacement of a tenant is subject to 
the regulations in this part;
    (H) A person who retains the right of use and occupancy of the real 
property for life following its acquisition by the agency;
    (I) An owner who retains the right of use and occupancy of the real 
property for a fixed term after its acquisition by the Department of 
the Interior under Public Law 93-477, Appropriations for National Park 
System, or Public Law 93-303, Land and Water Conservation Fund, except 
that such owner remains a displaced person for purposes of subpart D of 
this part;
    (J) A person who is determined to be in unlawful occupancy prior to 
or after the initiation of negotiations, or a person who has been 
evicted for cause, under applicable law, as provided for in Sec.  
24.206. However, advisory assistance may be provided to unlawful 
occupants at the option of the agency in order to facilitate the 
project;
    (K) A person who is not lawfully present in the United States and 
who has been determined to be ineligible for relocation assistance in 
accordance with Sec.  24.208; or
    (L) Temporary, daily, or emergency shelter occupants are in most 
cases not considered displaced persons. However, agencies may determine 
that a person occupying a shelter is a displaced person due to factors 
which could include reasonable expectation of a prolonged stay, or 
other extenuating circumstances. At a minimum, agencies shall provide 
advisory assistance to all occupants at initiation of negotiations. 
(See appendix A to this part, section 24.2(a), definition of displaced 
persons.)
    Dwelling means the place of permanent or customary and usual 
residence of a person, according to local custom or law, including a 
single-family house; a single-family unit in a two-family, multi-
family, or multi-purpose property; a unit of a condominium or 
cooperative housing project; a mobile home, or any other residential 
unit.
    Dwelling site means a land area that is typical in size for similar 
dwellings located in the same neighborhood or rural area. (See appendix 
A to this part, section 24.2(a).)
    Farm operation means any activity conducted solely or primarily for 
the production of one or more agricultural products or commodities, 
including timber, for sale or home use, and customarily producing such 
products or commodities in sufficient quantity to be capable of 
contributing materially to the operator's support.
    Federal financial assistance means a grant, loan, or contribution 
provided by the United States, except any Federal guarantee, insurance 
or tax credits (Low Income Housing Tax Credit) and any interest 
reduction payment to an individual in connection with the purchase and 
occupancy of a residence by that individual.
    Household income means total gross income received for a 12-month 
period from all sources (earned and unearned) including, but not 
limited to wages, salary, child support, alimony, unemployment 
benefits, workers compensation, social security, or the net income from 
a business. It does not include income received or earned by dependent 
children under 18, or full-time students who are students for at least 
5 months of the year and are under

[[Page 36948]]

the age of 24. (See appendix A to this part, section 24.2(a), for 
examples of exclusions to income.)
    Initiation of negotiations, unless a different action is specified 
in applicable Federal program regulations, means the following:
    (i) Whenever the displacement results from the acquisition of the 
real property by a Federal agency or State agency, the term means the 
delivery of the initial written offer of just compensation by the 
agency to the owner or the owner's representative to purchase the real 
property for the project. However, if the Federal agency or State 
agency issues a notice of its intent to acquire, rehabilitate, or 
demolish the real property, and a person moves after that notice, but 
before delivery of the initial written purchase offer, the term means 
the actual move of the person from the property.
    (ii) Whenever the displacement is caused by rehabilitation, 
demolition, or privately undertaken acquisition of the real property 
(and there is no related acquisition by a Federal agency or a State 
agency), the term means the notice to the person that he or she will be 
displaced by the project or, if there is no notice, the actual move of 
the person from the property.
    (iii) In the case of a permanent relocation to protect the public 
health and welfare, under the Comprehensive Environmental Response 
Compensation and Liability Act of 1980 (Pub. L. 96-510, or Superfund), 
the term means the formal announcement of such relocation or the 
Federal or federally-coordinated health advisory where the Federal 
Government later decides to conduct a permanent relocation.
    (iv) In the case of permanent relocation of a tenant as a result of 
a voluntary-acquisition of real property described in Sec.  
24.101(b)(1) the tenant is not eligible for relocation assistance under 
this part, until there is a binding written agreement between the 
agency and the owner that obligates the agency, without further 
election, to purchase the real property. (See appendix A to this part, 
section 24.2(a).) Agreements such as options to purchase and 
conditional purchase and sale agreements are not considered a binding 
agreement within the meaning of this part unless such agreements 
satisfy the requirements of the Federal agency providing the Federal 
financial assistance or until all conditions to the agency's obligation 
to purchase the real property have been satisfied.
    Lead Agency means the Department of Transportation acting through 
the Federal Highway Administration.
    Mobile home (manufactured home), when used in this part, includes 
manufactured homes and recreational vehicles used as residences. The 
term manufactured home is defined at 24 CFR part 3280 (see appendix A 
to this part, section 24.2(a)).
    Mortgage means such classes of liens as are commonly given to 
secure advances on, or the unpaid purchase price of, real property, 
under the laws of the State in which the real property is located, 
together with the credit instruments, if any, secured thereby.
    Nonprofit organization means an organization that is incorporated 
under the applicable laws of a State as a nonprofit organization and 
exempt from paying Federal income taxes under section 501 of the 
Internal Revenue Code (26 U.S.C. 501).
    Owner of a dwelling means a person who is considered to have met 
the requirement to own a dwelling if the person purchases or holds any 
of the following interests in real property:
    (i) Fee title, a life estate, a land contract, a 99-year lease, or 
a lease including any options for extension with at least 50 years to 
run from the date of acquisition; or
    (ii) An interest in a cooperative housing project which includes 
the right to occupy a dwelling; or
    (iii) A contract to purchase any of the interests or estates 
described in this section; or
    (iv) Any other interest, including a partial interest, which in the 
judgment of the agency warrants consideration as ownership.
    Owner's or tenant's designated representative means a 
representative designated by a property owner or tenant to receive all 
required notifications and documents from the agency. The owner or 
tenant must provide the agency a written notification which states that 
they are designating a representative, provide that person's name and 
contact information and what if any notices or information, the 
representative is not authorized to receive.
    Person means any individual, family, partnership, corporation, or 
association.
    Program or project means any activity or series of activities 
undertaken by a Federal agency or with Federal financial assistance 
received or anticipated in any phase of an undertaking in accordance 
with the Federal funding agency guidelines.
    Recipient means a non-Federal entity that receives a Federal award 
directly from a Federal agency to carry out an activity under a Federal 
program. The recipient is accountable to the Federal funding agency for 
the use of the funds and for compliance with applicable Federal 
requirements. The term recipient does not include subrecipients.
    Reverse mortgage (also known as a Home Equity Conversion Mortgage 
(HECM)) means a first mortgage which provides for future payments to 
the homeowner based on accumulated equity and which a housing creditor 
is authorized to make under any Federal law or State constitution, law, 
or regulation. See 12 U.S.C. 1715z-20 for additional information. It is 
a class of lien generally available to persons 62 years of age or 
older. Reverse mortgages do not require a monthly mortgage payment and 
can also be used to access a home's equity. The reverse mortgage 
becomes due when none of the original borrowers lives in the home, if 
taxes or insurance become delinquent, or if the property falls into 
disrepair.
    Salvage value means the probable sale price of an item offered for 
sale to knowledgeable buyers with the requirement that it be removed 
from the property at a buyer's expense (i.e., not eligible for 
relocation assistance). This includes items for re-use as well as items 
with components that can be re-used or recycled when there is no 
reasonable prospect for sale except on this basis.
    Small business means a business having not more than 500 employees 
working at the site being acquired or displaced by a program or 
project, which site is the location of economic activity. Sites 
occupied solely by outdoor advertising signs, displays, or devices do 
not qualify as a business for purposes of Sec.  24.303 or Sec.  24.304.
    State means any of the several States of the United States or the 
District of Columbia, the Commonwealth of Puerto Rico, any territory or 
possession of the United States, or a political subdivision of any of 
these jurisdictions.
    Subrecipient means a government agency or legal entity that enters 
into an agreement with a recipient to carry out part or all of the 
activity funded by Federal program grant funds. A subrecipient is 
accountable to the recipient for the use of the funds and for 
compliance with applicable Federal requirements.
    Temporary, daily, or emergency shelter (shelter) means any 
facility, the primary purpose of which is to provide a person with a 
temporary overnight shelter which does not allow prolonged or 
guaranteed occupancy. A shelter typically requires the occupants to 
remove their personal property and themselves from the premises on a 
daily basis, offers no guarantee of reentry in the evening, and in most 
cases does not

[[Page 36949]]

meet the definition of dwelling as used in this part.
    Tenant means a person who has the temporary use and occupancy of 
real property owned by another.
    Uneconomic remnant means a parcel of real property in which the 
owner is left with an interest after the partial acquisition of the 
owners' property, and which the agency has determined has little or no 
value or utility to the owner.
    Uniform Act or Act means the Uniform Relocation Assistance and Real 
Property Acquisition Policies Act of 1970 (Pub. L. 91-646, 84 Stat. 
1894; 42 U.S.C. 4601 et seq.), and amendments thereto.
    Unlawful occupant means a person who occupies without property 
right, title, or payment of rent, or a person legally evicted, with no 
legal rights to occupy a property under State law. An agency, at its 
discretion, may consider such person to be in lawful occupancy for the 
purpose of determining eligibility for assistance under the Uniform 
Act.
    Utility costs means expenses for electricity, gas, other heating 
and cooking fuels, water, and sewer.
    Utility facility means:
    (i) Any line, facility, or system for producing, transporting, 
transmitting, or distributing communications, cable, television, power, 
electricity, light, heat, gas, oil, crude products, water, steam, 
waste, storm water not connected with highway drainage, or any other 
similar commodity, including any fire or police signal system or street 
lighting system, which directly or indirectly serves the public; any 
fixtures, equipment, or other property associated with the operation, 
maintenance, or repair of any such system. A utility facility may be 
publicly, privately, or cooperatively owned.
    (ii) The term shall also mean the utility company including any 
substantially owned or controlled subsidiary. For the purposes of this 
part the term includes those utility-type facilities which are owned or 
leased by a Government agency for its own use, or otherwise dedicated 
solely to Governmental use. The term utility includes those facilities 
used solely by the utility which are part of its operating plant.
    Utility relocation means the adjustment of a utility facility 
required by the program or project undertaken by the agency. It 
includes removing and reinstalling the facility, including necessary 
temporary facilities; necessary right-of-way on a new location; moving, 
rearranging, or changing the type of existing facilities; and taking 
any necessary safety and protective measures. It shall also mean 
constructing a replacement facility that has the functional equivalency 
of the existing facility and is necessary for the continued operation 
of the utility service, the project economy, or sequence of project 
construction.
    Waiver valuation means the valuation process used and the product 
produced when the agency determines that an appraisal is not required, 
pursuant to Sec.  24.102(c)(2) appraisal waiver provisions. Waiver 
valuations are not appraisals as defined by the Uniform Act and this 
part.
    (b) Acronyms. The following acronyms are commonly used in the 
implementation of programs subject to this part:
    (1) DOT (U.S. Department of Transportation).
    (2) FEMA (Federal Emergency Management Agency).
    (3) FHA (Federal Housing Administration).
    (4) FHWA (Federal Highway Administration).
    (5) FIRREA (Financial Institutions Reform, Recovery, and 
Enforcement Act of 1989).
    (6) HLR (housing of last resort).
    (7) HUD (U.S. Department of Housing and Urban Development).
    (8) MIDP (mortgage interest differential payment).
    (9) RHP (replacement housing payment).
    (10) STURAA (Surface Transportation and Uniform Relocation 
Assistance Act of 1987).
    (11) UA or URA (Uniform Relocation Assistance and Real Property 
Acquisition Policies Act of 1970).
    (12) USCIS (U.S. Citizenship and Immigration Services).
    (13) USPAP (Uniform Standards of Professional Appraisal Practice).


Sec.  24.3  No duplication of payments.

    No person shall receive any payment under this part if that person 
receives a payment under Federal, State, local law, or insurance 
proceeds which is determined by the agency to have the same purpose and 
effect as such payment under this part. (See appendix A to this part, 
section 24.3.)


Sec.  24.4  Assurances, monitoring, and corrective action.

    (a) Assurances. (1) Before a Federal agency may approve any grant 
to, or contract, or agreement with, an agency under which Federal 
financial assistance will be made available for a project which results 
in real property acquisition or displacement that is subject to the 
Uniform Act, the agency must provide appropriate assurances that it 
will comply with the Uniform Act and this part. An agency's assurances 
shall be in accordance with sections 4630 and 4655 of the Uniform Act. 
The agency's Uniform Act section 4655 assurances must contain specific 
reference to any State law which the agency believes provides an 
exception to sections 4651 or 4652 of the Uniform Act. If, in the 
judgment of the Federal agency, Uniform Act compliance will be served, 
an agency may provide these assurances at one time to cover all 
subsequent federally assisted programs or projects. An agency, which 
both acquires real property and displaces persons, may combine its 
sections 4630 and 4655 of the Uniform Act assurances in one document.
    (2) If a Federal agency or recipient provides Federal financial 
assistance to a person causing displacement, such Federal agency or 
recipient is responsible for ensuring compliance with the requirements 
of this part, notwithstanding the person's contractual obligation to 
the recipient to comply with the requirements of this part.
    (3) As an alternative to the assurance requirement described in 
paragraph (a)(1) of this section, a Federal agency may provide Federal 
financial assistance to a recipient after it has accepted a 
certification by such recipient in accordance with the requirements in 
subpart G of this part.
    (b) Monitoring and corrective action. The Federal agency will 
monitor compliance with this part, and the agency shall take whatever 
corrective action is necessary to comply with the Uniform Act and this 
part. The Federal agency may also apply sanctions in accordance with 
applicable program regulations. (Also see Sec.  24.603)
    (c) Prevention of fraud, waste, and mismanagement. The agency shall 
take appropriate measures to carry out this part in a manner that 
minimizes fraud, waste, and mismanagement.


Sec.  24.5  Manner of notices and electronic signatures.

    (a) Each notice that the agency is required to provide to a 
property owner or occupant under this part, except the notice described 
at Sec.  24.102(b), shall be personally served or sent by certified or 
registered first-class mail, return receipt requested (or by companies 
other than the United States Postal Service that provide the same 
function as certified mail with return receipts) and documented in 
agency files. A Federal funding agency may approve a process to permit 
the displaced person to elect to receive required notices by electronic 
delivery in lieu of the use of certified or

[[Page 36950]]

registered first-class mail, return receipt requested, or personally 
served notices, when an agency demonstrates a means to document receipt 
of such notices by the property owner or occupant. A Federal funding 
agency may approve a process to permit the use of electronic signature 
which meet the requirements of paragraph (e) of this section.
    (b) An agency requesting use of electronic delivery of notices must 
include the following safeguards:
    (1) A process to inform property owners and occupants they will 
continue to receive Notices as described in paragraph (a) of this 
section unless they voluntarily elect to receive electronic notices.
    (2) A process to document and record when information is legally 
delivered in digital format. A date and timestamp must establish the 
date of delivery and receipt with an electronic record capable of 
retention.
    (3) A process to link the electronic signature with an electronic 
document in a way that can be used to determine whether the electronic 
document was changed subsequent to when an electronic signature was 
applied to the document.
    (4) A certification that use of electronic notices is consistent 
with existing State and Federal laws.
    (c) Each notice shall be written in plain, understandable language. 
Persons who are unable to read and understand the notice must be 
provided with appropriate translation and counseling. Each notice shall 
indicate the name and telephone number of a person who may be contacted 
for answers to questions or other needed help. (See appendix A to this 
part, section 24.5.)
    (d) A property owner or tenant may designate a representative to 
receive offers, correspondence, and information and to provide any 
information on their behalf required by the displacing agency by 
providing a written request to the agency (see Sec.  24.2(a), 
definition of owner's or tenant's designated representative).
    (e) An agency requesting use of electronic signature of documents 
must include the following safeguards:
    (1) A process to document and record when information is legally 
delivered in digital format. A date and timestamp must establish the 
date of delivery and receipt with an electronic record capable of 
retention.
    (2) A process to link the electronic signature with an electronic 
document in a way that can be used to determine whether the electronic 
document was changed subsequent to when an electronic signature was 
applied to the document.
    (3) A certification that use of electronic signatures is consistent 
with existing State and Federal laws.


Sec.  24.6  Administration of jointly-funded projects.

    Whenever two or more Federal agencies provide financial assistance 
to an agency or agencies, other than a Federal agency, to carry out 
functionally or geographically related activities which will result in 
the acquisition of property or the displacement of a person, the 
Federal agencies may by agreement designate one such agency as the 
cognizant Federal agency. In the unlikely event that agreement among 
the agencies cannot be reached as to which agency shall be the 
cognizant Federal agency, then the Lead Agency shall designate one of 
such agencies to assume the cognizant role. At a minimum, the agreement 
shall set forth the federally assisted activities which are subject to 
its terms and cite any policies and procedures, in addition to this 
part, that are applicable to the activities under the agreement. Under 
the agreement, the cognizant Federal agency shall ensure that the 
project is in compliance with the provisions of the Uniform Act and 
this part. All federally assisted activities under the agreement shall 
be deemed a project for the purposes of this part.


Sec.  24.7  Federal agency waiver of regulations in this part.

    The Federal agency funding the project may waive any requirement in 
this part not required by law if it determines that the waiver does not 
reduce any assistance or protection provided to an owner or displaced 
person under this part. Any request for a waiver shall be justified on 
a case-by-case basis.


Sec.  24.8  Compliance with other laws and regulations.

    The implementation of this part must be in compliance with other 
applicable Federal laws and implementing regulations, including, but 
not limited to, the following:
    (a) Section I of the Civil Rights Act of 1866 (42 U.S.C. 1982 et 
seq.).
    (b) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et 
seq.).
    (c) The Fair Housing Act (42 U.S.C. 3601 et seq.), as amended.
    (d) The National Environmental Policy Act of 1969 (42 U.S.C. 4321 
et seq.).
    (e) Section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 790 et 
seq.).
    (f) The Flood Disaster Protection Act of 1973 (42 U.S.C. 4002 et 
seq.).
    (g) The Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.).
    (h) Executive Order 11063--Equal Opportunity and Housing, as 
amended by Executive Order 12892.
    (i) Executive Order 11246--Equal Employment Opportunity, as 
amended.
    (j) Executive Order 11625--Minority Business Enterprise.
    (k) Executive Orders 11988--Floodplain Management, and 11990--
Protection of Wetlands.
    (l) Executive Order 12250--Leadership and Coordination of Non-
Discrimination Laws.
    (m) Executive Order 12630--Governmental Actions and Interference 
with Constitutionally Protected Property Rights.
    (n) Robert T. Stafford Disaster Relief and Emergency Assistance 
Act, as amended (42 U.S.C. 5121 et seq.).
    (o) Executive Order 12892--Leadership and Coordination of Fair 
Housing in Federal Programs: Affirmatively Furthering Fair Housing.


Sec.  24.9  Recordkeeping and reports.

    (a) Records. The agency shall maintain adequate records of its 
acquisition and displacement activities in sufficient detail to 
demonstrate compliance with this part. These records shall be retained 
for at least 3 years after each owner of a property and each person 
displaced from the property receives the final payment to which he or 
she is entitled under this part, or in accordance with the applicable 
regulations of the Federal funding agency, whichever is later.
    (b) Confidentiality of records. Records maintained by an agency in 
accordance with this part are confidential regarding their use as 
public information, unless applicable law provides otherwise.
    (c) Reports. Each Federal agency that has programs or projects 
requiring the acquisition of real property or causing a displacement 
from real property subject to the provisions of the Uniform Act shall 
provide to the Lead Agency an annual summary report by November 15 that 
describes the real property acquisitions, displacements, and related 
activities conducted by the Federal agency for the prior calendar year. 
(See appendix A to this part, section 24.9(c).)


Sec.  24.10  Appeals.

    (a) General. The agency shall promptly review appeals in accordance 
with the requirements of applicable law and this part.
    (b) Actions which may be appealed. Any aggrieved person may file a 
written appeal with the agency in any case in which the person believes 
that the agency has failed to properly consider the person's 
application for assistance under this part. Such assistance may

[[Page 36951]]

include, but is not limited to, the person's eligibility for, or the 
amount of, a payment required under Sec.  24.106 or Sec.  24.107, or a 
relocation payment required under this part. The agency shall consider 
a written appeal regardless of form.
    (c) Time limit for initiating appeal. The agency may set a 
reasonable time limit for a person to file an appeal. The time limit 
shall not be less than 60 days after the person receives written 
notification of the agency's determination on the person's claim.
    (d) Right to representation. A person has a right to be represented 
by legal counsel or other representative in connection with his or her 
appeal, but solely at the person's own expense.
    (e) Review of files by person making appeal. The agency shall 
permit a person to inspect and copy all materials pertinent to his or 
her appeal, except materials which are classified as confidential by 
the agency. The agency may, however, impose reasonable conditions on 
the person's right to inspect, consistent with applicable laws.
    (f) Scope of review of appeal. In deciding an appeal, the agency 
shall consider all pertinent justification and other material submitted 
by the person, and all other available information that is needed to 
ensure a fair and full review of the appeal.
    (g) Determination and notification after appeal. Promptly after 
receipt of all information submitted by a person in support of an 
appeal, the agency shall make a written determination on the appeal, 
including an explanation of the basis on which the decision was made, 
and furnish the person a copy. If the full relief requested is not 
granted, the agency shall inform the person that the determination is 
the agency's final decision and that the person may seek judicial 
review of the agency's determination.
    (h) Agency official to review appeal. The agency official 
conducting the review of the appeal shall be either the head of the 
agency or his or her authorized designee. However, the official shall 
not have been directly involved in the action appealed.


Sec.  24.11  Adjustments of limits and payments.

    (a) The Lead Agency may adjust the following valuation limits and 
maximum relocation benefits payments:
    (1) The waiver valuation limits at Sec.  24.102(c)(2)(ii) 
introductory text and (c)(2)(ii)(C);
    (2) The conflict of interest valuation limits at Sec.  
24.102(n)(3); and
    (3) The maximum amounts of relocation payments provided at 
Sec. Sec.  24.301, 24.304, 24.305, 24.401, 24.402, 24.502, and 24.503.
    (b) The head of the Lead Agency will evaluate whether the cost of 
living, inflation, or other factors indicate that limits, and payments 
provided in paragraph (a) of this section, should be adjusted to meet 
the policy objectives of the Uniform Act. The Lead Agency will divide 
the Consumer Price Index for All Urban Consumers (CPI-U) index for the 
year of the assessment (current year), by the CPI-U index for the year 
of the previous assessment (base year index/year of last adjustment) to 
determine the effect of inflation over the assessment period. If 
adjustments are determined to be necessary, the head of the Lead Agency 
will publish the new maximum benefit limits eligible for Federal 
participation in the Federal Register. (See appendix A to this part, 
section 24.11.)

Subpart B--Real Property Acquisition


Sec.  24.101  Applicability of acquisition requirements.

    (a) Direct Federal program or project. (1) The requirements of this 
subpart apply to any acquisition of real property for a direct Federal 
program or project, except acquisition for a program or project that is 
undertaken by the Tennessee Valley Authority or the Rural Utilities 
Service. (See appendix A to this part, section 24.101(a).)
    (2) If a Federal agency (except for the Tennessee Valley Authority 
or the Rural Utilities Service) will not acquire a property because 
negotiations fail to result in an agreement, the owner of the property 
or the owner's designated representative shall be so informed in 
writing. Owners of such properties are not displaced persons, and as 
such, are not entitled to relocation assistance benefits. However, 
tenants on such properties may be eligible for relocation assistance 
benefits. (See Sec.  24.2(a).)
    (b) Programs and projects receiving Federal financial assistance. 
The requirements of this subpart apply to any acquisition of real 
property for programs and projects where there is Federal financial 
assistance in any part of project costs except for the acquisitions 
described in paragraphs (b)(1) through (3) of this section. The 
relocation assistance provisions in this part are not applicable to 
owner-occupants who move as a result of a voluntary acquisition. (See 
Sec.  24.2(a), definition of displaced person.) The relocation 
assistance provisions in this part are applicable to tenants who must 
permanently relocate as a result of an acquisition described in 
paragraphs (b)(1) through (3) of this section. Such tenants are 
considered displaced persons. (See Sec.  24.2(a), definition of 
displaced person.)
    (1) The agency will not use the power of eminent domain to acquire 
the property, and the following conditions are met:
    (i) No later than the time of the offer the agency informs the 
owner of the property or the owner's designated representative in 
writing of the following:
    (A) The agency will not acquire the property if negotiations fail 
to result in an amicable agreement; and
    (B) The agency's estimate of fair market value for the property to 
be acquired. (See appendix A to this part, sections 24.101(b)(1)(i) and 
24.101(b)(1)(i)(B).)
    (ii) Where an agency wishes to purchase more than one property 
within a general geographic area on this basis, all owners are to be 
treated similarly. (See appendix A to this part, section 
24.101(b)(1)(ii).)
    (iii) The property to be acquired is not part of an intended, 
planned, or designated project area where all or substantially all of 
the property within the area must be acquired within specific time 
limits. (See appendix A to this part, section 24.101(b)(1)(iii).)
    (2) The acquisition of real property by a cooperative from a person 
who, as a condition of membership in the cooperative, has agreed to 
provide without charge any real property that is needed by the 
cooperative.
    (3) Acquisition for a program or project that receives Federal 
financial assistance from the Tennessee Valley Authority or the Rural 
Utilities Service.
    (c) Less-than-full-fee interest in real property. (1) The 
provisions of this subpart apply when acquiring fee title subject to 
retention of a life estate or a life use; to acquisition by leasing 
where the lease term, including option(s) for extension, is 50 years or 
more; and, to the acquisition of permanent and/or temporary easements 
necessary for the project. However, the agency may apply the 
regulations in this subpart to any less-than-full-fee acquisition that, 
in its judgment, should be covered.
    (2) The provisions of this subpart do not apply to temporary 
easements or permits needed solely to perform work intended exclusively 
for the benefit of the property owner, which work may not be done if 
agreement cannot be reached.
    (d) Federally-assisted projects. For projects receiving Federal 
financial assistance, the provisions of Sec. Sec.  24.102, 24.103, 
24.104, and 24.105 apply to the greatest extent practicable under State 
law. (See Sec.  24.4(a).)

[[Page 36952]]

Sec.  24.102  Basic acquisition policies.

    (a) Expeditious acquisition. The agency shall make every reasonable 
effort to acquire the real property expeditiously by negotiation.
    (b) Notice to owner. As soon as feasible, the agency shall notify 
the owner in writing of the agency's interest in acquiring the real 
property and the basic protections provided to the owner by law and 
this part. (See Sec. Sec.  24.203 and 24.5(d) and appendix A to this 
part, section 24.102(b).)
    (c) Appraisal, waiver thereof, and invitation to owner. (1) Before 
the initiation of negotiations, the real property to be acquired shall 
be appraised, except as provided in paragraph (c)(2) of this section, 
and the owner, or the owner's designated representative, shall be given 
an opportunity to accompany the appraiser during the appraiser's 
inspection of the property.
    (2) An appraisal is not required if:
    (i) The owner is donating the property and releases the agency from 
its obligation to appraise the property; or
    (ii) The agency determines that an appraisal is unnecessary because 
the valuation problem is uncomplicated and has a low fair market value, 
and the anticipated value of the proposed acquisition is estimated at 
$15,000 or less, based on a review of available data. The agency 
representative making the determination to use the waiver valuation 
option must understand valuation principles, techniques, and use of 
appraisals in order to be able to determine whether the valuation of 
the proposed acquisition is uncomplicated and has a low fair market 
value. (See appendix A to this part, section 24.102(c)(2).)
    (A) When an appraisal is determined to be unnecessary, the agency 
shall prepare a waiver valuation.
    (1) Waiver valuations are not appraisals by definition in this part 
(See Sec.  24.2). Persons preparing or reviewing a waiver valuation are 
precluded from complying with Standards Rules 1, 2, 3, and 4 of the 
``Uniform Standards of Professional Appraisal Practice,'' as 
promulgated by the Appraisal Standards Board of The Appraisal 
Foundation \1\ (see appendix A to this part, sections 24.102(c) and 
24.103(a).)
---------------------------------------------------------------------------

    \1\ Uniform Standards of Professional Appraisal Practice 
(USPAP). Published by The Appraisal Foundation, a nonprofit 
educational organization. Copies may be ordered from The Appraisal 
Foundation.
---------------------------------------------------------------------------

    (2) Because a waiver valuation is not an appraisal, a review of a 
waiver valuation is not required. However, some recipients may also be 
subject to State laws or agency requirements to review a waiver 
valuation.
    (B) The person performing the waiver valuation must have sufficient 
understanding of the local real estate market in order to be qualified 
to perform the waiver valuation.
    (C) The Federal agency funding the project may approve exceeding 
the $15,000 threshold, up to an amount of $35,000, if the agency 
acquiring the real property offers the property owner the option of 
having the agency appraise the property.
    (D) If the agency determines that the proposed acquisition is 
uncomplicated and has a low fair market value, and if the agency 
acquiring the real property offers the property owner the option of 
having the agency appraise the property, the agency may request 
approval from the Federal funding agency to use a waiver valuation for 
properties with estimated values of more than $35,000 and up to 
$50,000. Approval for using a waiver valuation of more than $35,000, 
but up to $50,000 may only be requested on a project-by-project basis 
and the request for doing so shall be made in writing to the Federal 
funding agency setting forth the anticipated benefits of, and reasons 
for, raising the waiver valuation ceiling above $35,000. Within 6 
months of completion of acquisition activities a close-out report 
measuring cost/time benefits, condemnation rate, settlement rate, and 
any other relevant metric which the funding agency requires to 
adequately document both the administrative savings and accuracy and 
efficacy of the waiver valuations of more than $35,000, but up to 
$50,000 shall be submitted to the funding agency.
    (E) Under paragraphs (c)(2)(ii)(C) and (D) of this section, if the 
property owner elects to have the agency appraise the property, the 
agency must obtain an appraisal and shall not use the waiver valuation 
procedures described in paragraphs (c)(2)(ii)(A) through (D) of this 
section. (See appendix A to this part, section 24.102(c)(2).)
    (d) Establishment and offer of just compensation. Before the 
initiation of negotiations, the agency shall establish an amount which 
it believes is just compensation for the real property. The amount 
shall not be less than the approved appraisal or waiver valuation of 
the fair market value of the property, taking into account the value of 
allowable damages or benefits to any remaining property. An agency 
official must establish the amount believed to be just compensation. 
(See Sec.  24.104.) Promptly thereafter, the agency shall make a 
written offer to the owner or the designated owner's representative to 
acquire the property for the full amount believed to be just 
compensation. (See appendix A to this part, section 24.102(d).)
    (e) Summary statement. Along with the initial written purchase 
offer, the owner or the designated owner's representative shall be 
given a written statement of the basis for the offer of just 
compensation, which shall include:
    (1) A statement of the amount offered as just compensation. In the 
case of a partial acquisition, the compensation for the real property 
to be acquired and the compensation for damages, if any, to the 
remaining real property shall be separately stated.
    (2) A description and location identification of the real property 
and the interest in the real property to be acquired.
    (3) An identification of the buildings, structures, and other 
improvements (including removable building equipment and trade 
fixtures) which are included as part of the offer of just compensation. 
Where appropriate, the statement shall identify any other separately 
held ownership interest in the property, e.g., a tenant-owned 
improvement, and indicate that such interest is not covered by this 
offer.
    (f) Basic negotiation procedures. The agency shall make all 
reasonable efforts to contact the owner or the owner's designated 
representative and discuss its offer to purchase the property, 
including the basis for the offer of just compensation and explain its 
acquisition policies and procedures, including its payment of 
incidental expenses in accordance with Sec.  24.106. The owner shall be 
given reasonable opportunity to consider the offer and present material 
which the owner believes is relevant to determining the value of the 
property and to suggest modification in the proposed terms and 
conditions of the purchase. The agency shall consider the owner's or 
the designated owner's representative's presentation. (See appendix A 
to this part, section 24.102(f).)
    (g) Updating offer of just compensation. If the information 
presented by the owner, or a material change in the character or 
condition of the property, indicates the need for new waiver valuation 
or appraisal information, or if a significant delay has occurred since 
the time of the appraisal(s) or waiver valuation of the property, the 
agency shall have the appraisal(s) or waiver valuation updated or 
obtain a new appraisal(s) or waiver valuation. If the latest appraisal 
or waiver valuation information indicates that a change in the purchase 
offer is warranted, the agency shall promptly

[[Page 36953]]

reestablish just compensation and offer that amount to the owner in 
writing.
    (h) Coercive action. The agency shall not advance the time of 
condemnation, or defer negotiations or condemnation, or the deposit of 
funds with the court, or take any other coercive action in order to 
induce an agreement on the price to be paid for the property.
    (i) Administrative settlement. The purchase price for the property 
may exceed the amount offered as just compensation when reasonable 
efforts to negotiate an agreement at that amount have failed and an 
authorized agency official approves such administrative settlement as 
being reasonable, prudent, and in the public interest. When Federal 
funds pay for or participate in acquisition costs, a written 
justification shall be prepared, which states what available 
information, including trial risks, supports such a settlement. (See 
appendix A to this part, section 24.102(i).)
    (j) Payment before taking possession. Before requiring the owner to 
surrender possession of the real property, the agency shall pay the 
agreed purchase price to the owner, or in the case of a condemnation, 
deposit with the court, for the benefit of the owner, an amount not 
less than the agency's approved appraisal of the fair market value of 
such property, or the court award of compensation in the condemnation 
proceeding for the property. In exceptional circumstances, with the 
prior approval of the owner or the owner's designated representative, 
the agency may obtain a right-of-entry for construction purposes before 
making payment available to an owner. (See appendix A to this part, 
section 24.102(j).)
    (k) Uneconomic remnant. If the acquisition of only a portion of a 
property would leave the owner with an uneconomic remnant, the agency 
shall offer to acquire the uneconomic remnant along with the portion of 
the property needed for the project. (See Sec.  24.2(a).)
    (l) Inverse condemnation. If the agency intends to acquire any 
interest in real property by exercise of the power of eminent domain, 
it shall institute formal condemnation proceedings and not 
intentionally make it necessary for the owner to institute legal 
proceedings to prove the fact of the taking of the real property.
    (m) Fair rental. If the agency permits a former owner or tenant to 
occupy the real property after acquisition for a short term, or a 
period subject to termination by the agency on short notice, the rent 
shall not exceed the fair market rent for such occupancy. (See appendix 
A to this part, section 24.102(m).)
    (n) Conflict of interest. (1) The appraiser, review appraiser, or 
person performing the waiver valuation shall not have any interest, 
direct or indirect, in the real property being valued for the agency. 
Compensation for developing an appraisal or waiver valuation shall not 
be based on the reported opinion of value.
    (2) No person shall attempt to unduly influence or coerce an 
appraiser, review appraiser, or waiver valuation preparer regarding any 
valuation aspect of an appraisal, waiver valuation, or review of 
appraisals or waiver valuations. Persons functioning as negotiators may 
not supervise or formally evaluate the performance of any appraiser, 
waiver valuation preparer, or review appraiser performing appraisal or 
appraisal review work, except that, for a program or project receiving 
Federal financial assistance, the Federal funding agency may waive this 
requirement if it determines it would create a hardship for the agency.
    (3) An appraiser, review appraiser, or waiver valuation preparer 
may be authorized by the agency to act as a negotiator for the 
acquisition of real property for which that person has performed an 
appraisal, appraisal review or waiver valuation only if the offer to 
acquire the property is $15,000, or less. Agencies that wish to use 
this same authority to act as the negotiator on a valuation greater 
than $15,000, and up to $35,000, may not use a waiver valuation, and 
these acquisitions are subject to the following conditions:
    (i) For those acquisitions where the appraiser or review appraiser 
will also act as the negotiator, an appraisal must be performed in 
compliance with Sec.  24.103 and reviewed in compliance with Sec.  
24.104;
    (ii) Agencies and recipients desiring to exercise this option must 
request approval in writing from the Federal funding agency;
    (iii) The requesting agency shall have a separate and distinct 
quality control process in place and set forth in the written 
procedures approved by the Federal funding agency; and
    (4) Agencies wishing to allow subrecipients to use conflict of 
interest waivers of more than $15,000 must determine and document that 
the subrecipient has a separate and distinct quality control process in 
place which is set forth in written procedures approved by the agency 
or in an agency approved subrecipient's written procedures. (See 
appendix A to this part, section 24.102(n).) Agencies and recipients 
desiring to exercise this option must request approval in writing from 
the Federal funding agency.


Sec.  24.103  Criteria for appraisals.

    (a) Appraisal requirements. This section sets forth the 
requirements for real property acquisition appraisals for Federal and 
federally assisted programs. Appraisals are to be performed according 
to this section, which is intended to be consistent with the USPAP. 
(See appendix A to this part, section 24.103(a).) The agency may have 
appraisal requirements that supplement this section, including, and to 
the extent appropriate, the Uniform Appraisal Standards for Federal 
Land Acquisition (UASFLA), also commonly referred to as the ``Yellow 
Book''. The USPAP is published by The Appraisal Foundation. The UASFLA 
is published by the Appraisal Foundation in partnership with the 
Department of Justice on behalf of the Interagency Land Acquisition 
Conference. The UASFLA is a compendium of Federal eminent domain 
appraisal law, both case and statute, regulations, and practices.\1\ 
Copies of the USPAP and the UASFLA may be ordered from The Appraisal 
Foundation in print and electronic forms.\2\
---------------------------------------------------------------------------

    \1\ www.justice.gov/file/408306/download.
    \2\ http://www.appraisalfoundation.org/imis/TAF/Standards/Appraisal_Standards/TAF/Standards.aspx.
---------------------------------------------------------------------------

    (1) The agency acquiring real property has a legitimate role in 
contributing to the appraisal process, especially in developing the 
scope of work and defining the appraisal problem. The scope of work and 
performance of an appraisal under this section depends on the 
complexity of the appraisal problem.
    (2) The agency has the responsibility to assure that the appraisals 
it obtains are relevant to its program needs, reflect established and 
commonly accepted Federal and federally assisted program appraisal 
practice, and at a minimum, comply with the definition of appraisal in 
Sec.  24.2(a) and the requirements in paragraphs (a)(2)(i) through (v) 
of this section. (See appendix A to this part, sections 24.103 and 
Section 24.103(a).)
    (i) An adequate description of the physical characteristics of the 
property being appraised (and, in the case of a partial acquisition, an 
adequate description of the remaining property), including items 
identified as personal property, a statement of the known and observed 
encumbrances, if any, title information, location, zoning, present use, 
an analysis of highest and best use, and at least a 5-year sales 
history of the property. (See appendix A to this part, section 
24.103(a)(1).)

[[Page 36954]]

    (ii) All relevant and reliable approaches to value consistent with 
established Federal and federally assisted program appraisal practices. 
If the appraiser uses more than one approach, there shall be an 
analysis and reconciliation of approaches to value use that is 
sufficient to support the appraiser's opinion of value. (See appendix A 
to this part, section 24.103(a).)
    (iii) A description of comparable sales, including a description of 
all relevant physical, legal, and economic factors such as parties to 
the transaction, source and method of financing, and verification by a 
party involved in the transaction.
    (iv) A statement of the value of the real property to be acquired 
and, for a partial acquisition, a statement of the value of the damages 
and benefits, if any, to the remaining real property, where 
appropriate.
    (v) The effective date of valuation, date of appraisal, signature, 
and certification of the appraiser.
    (b) Influence of the project on just compensation. The appraiser 
shall disregard any decrease or increase in the fair market value of 
the real property caused by the project for which the property is to be 
acquired, or by the likelihood that the property would be acquired for 
the project, other than that due to physical deterioration within the 
reasonable control of the owner. (See appendix A to this part, section 
24.103(b).)
    (c) Owner retention of improvements. If the owner of a real 
property improvement is permitted to retain it for removal from the 
project site, the amount to be offered for the interest in the real 
property to be acquired shall not be less than the difference between 
the amount determined to be just compensation for the owner's interest 
in the real property and the salvage value (defined at Sec.  24.2(a)) 
of the retained improvement.
    (d) Qualifications of appraisers and review appraisers. (1) The 
agency shall establish criteria for determining the minimum 
qualifications and competency of appraisers and review appraisers. 
Qualifications shall be consistent with the scope of work for the 
assignment. The agency shall review the experience, education, 
training, certification/licensing, designation(s) and other 
qualifications of appraisers, and review appraisers, and use only those 
determined by the agency to be qualified. (See appendix A to this part, 
section 24.103(d)(1).)
    (2) If the agency uses a contract (fee) appraiser to perform the 
appraisal, such appraiser shall be State licensed or certified in 
accordance with title XI of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989 (12 U.S.C. 3331 et seq.).


Sec.  24.104  Review of appraisals.

    The agency shall have an appraisal review process and, at a 
minimum:
    (a) A qualified review appraiser (see Sec.  24.103(d)(1) and 
appendix A to this part, section 24.104) shall examine the presentation 
and analysis of market information in all appraisals to ensure that 
they meet the definition of appraisal found in Sec.  24.2(a), appraisal 
requirements found in Sec.  24.103, and other applicable requirements 
(including, to the extent appropriate, the UASFLA), and support the 
appraiser's opinion of value. The level of review analysis depends on 
the complexity of the appraisal problem (see Sec.  24.103(a)(1) and 
appendix A, section 24.104(a)). As needed, the review appraiser shall, 
prior to acceptance of an appraisal report, seek necessary corrections 
or revisions. The review appraiser shall identify each appraisal report 
as recommended (as the basis for the establishment of the amount 
believed to be just compensation), accepted (meets all requirements, 
but not selected as recommended or approved), or not accepted. If 
authorized by the agency to do so, the staff review appraiser shall 
also approve the appraisal (as the basis for the establishment of the 
amount believed to be just compensation), and, if also authorized to do 
so, develop and report the amount believed to be just compensation. 
(See appendix A to this part, section 24.104(a).)
    (b) If the review appraiser is unable to recommend (or approve) an 
appraisal as an adequate basis for the establishment of the offer of 
just compensation, and it is determined by the agency that it is not 
practical to obtain an additional appraisal, the review appraiser may, 
as part of the review, present and analyze market information in 
conformance with Sec.  24.103 to support a recommended (or approved) 
value. (See appendix A to this part, section 24.104(b).)
    (c) The review appraiser shall prepare a written report that 
identifies the appraisal reports reviewed and documents the findings 
and conclusions arrived at during the review of the appraisal(s). Any 
damages or benefits to any remaining property shall be identified in 
the review appraiser's report. The review appraiser shall also prepare 
a signed certification that states the parameters of the review. The 
certification shall state the approved value and, if the review 
appraiser is authorized to do so, the amount believed to be just 
compensation for the acquisition. (See appendix A to this part, section 
24.104(c).)


Sec.  24.105  Acquisition of tenant-owned improvements.

    (a) Acquisition of improvements. When acquiring any interest in 
real property, the agency shall offer to acquire at least an equal 
interest in all buildings, structures, or other improvements located 
upon the real property to be acquired, which it requires to be removed 
or which it determines will be adversely affected by the use to which 
such real property will be put. This shall include any improvement 
owned by a tenant-owner who has the right or obligation to remove the 
improvement at the expiration of the lease term.
    (b) Improvements considered to be real property. Any building, 
structure, or other improvement, which would be considered real 
property if owned by the owner of the real property on which it is 
located, shall be considered to be real property for purposes of this 
subpart.
    (c) Appraisal and establishment of just compensation for a tenant-
owned improvement. Just compensation for a tenant-owned improvement is 
the amount which the improvement contributes to the fair market value 
of the whole property, or its salvage value, whichever is greater. 
(Salvage value is defined at Sec.  24.2(a).)
    (d) Special conditions for tenant-owned improvements. No payment 
shall be made to a tenant-owner for any real property improvement 
unless:
    (1) The tenant-owner, in consideration for the payment, assigns, 
transfers, and releases to the agency all of the tenant-owner's right, 
title, and interest in the improvement;
    (2) The owner of the real property on which the improvement is 
located disclaims all interest in the improvement; and
    (3) The payment does not result in the duplication of any 
compensation otherwise authorized by law.
    (e) Alternative compensation. Nothing in this subpart shall be 
construed to deprive the tenant-owner of any right to reject payment 
under this subpart and to obtain payment for such property interests in 
accordance with other applicable law.


Sec.  24.106  Expenses incidental to transfer of title to the agency.

    (a) The owner of the real property shall be reimbursed for all 
reasonable expenses the owner necessarily incurred for:
    (1) Recording fees, transfer taxes, documentary stamps, evidence of 
title,

[[Page 36955]]

boundary surveys, legal descriptions of the real property, and similar 
expenses incidental to conveying the real property to the agency. 
However, the agency is not required to pay costs solely required to 
perfect the owner's title to the real property;
    (2) Penalty costs and other charges for prepayment of any 
preexisting recorded mortgage entered into in good faith encumbering 
the real property; and
    (3) The pro rata portion of any prepaid real property taxes which 
are allocable to the period after the agency obtains title to the 
property or effective possession of it, whichever is earlier.
    (b) Whenever feasible, the agency shall pay these costs directly to 
the billing agent so that the owner will not have to pay such costs and 
then seek reimbursement from the agency.


Sec.  24.107  Certain litigation expenses.

    The owner of the real property shall be reimbursed for any 
reasonable expenses, including reasonable attorney, appraisal, and 
engineering fees, which the owner actually incurred because of a 
condemnation proceeding, if:
    (a) The final judgment of the court is that the agency cannot 
acquire the real property by condemnation;
    (b) The condemnation proceeding is abandoned by the agency other 
than under an agreed-upon settlement; or
    (c) The court having jurisdiction renders a judgment in favor of 
the owner in an inverse condemnation proceeding or the agency effects a 
settlement of such proceeding.


Sec.  24.108  Donations.

    An owner whose real property is being acquired may, after being 
fully informed by the agency of the right to receive just compensation 
for such property, donate such property or any part thereof, any 
interest therein, or any compensation paid therefore, to the agency as 
such owner shall determine. The agency is responsible for ensuring that 
an appraisal of the real property is obtained unless the owner releases 
the agency from such obligation, except as provided in Sec.  
24.102(c)(2).

Subpart C--General Relocation Requirements


Sec.  24.201  Purpose.

    This subpart prescribes general requirements governing the 
provision of relocation payments and other relocation assistance in 
this part.


Sec.  24.202  Applicability.

    The requirements in this subpart apply to the relocation of any 
permanently or temporarily displaced person, as defined at Sec.  
24.2(a). Any person who qualifies as a permanently or temporarily 
displaced person must be fully informed of his or her rights and 
entitlements to relocation assistance and payments provided by the 
Uniform Act and this part. (See appendix A to this part, section 
24.202.)
    (a) Persons required to move temporarily. (1) Appropriate notices 
must be provided in accordance with Sec.  24.203 and appropriate 
advisory services must be provided in accordance with Sec.  24.205;
    (2) For persons occupying a dwelling, at least one comparable 
dwelling, is made available prior to requiring a person to move, except 
in the case of an emergency move as described in Sec.  24.204(b)(1), 
(2), or (3) (see appendix A, to this part, section 24.202);
    (3) Similarly, if a person's business will be shut down due to a 
project which either requires the occupant to vacate the property or 
which denies physical access to the property, it may be temporarily 
relocated and reimbursed for all reasonable out of pocket expenses or 
must be determined to be permanently displaced at the agency's option;
    (4) Payment is provided for all out-of-pocket expenses incurred in 
connection with the temporary relocation as the agency determines to be 
reasonable and necessary, associated with comparable replacement 
dwelling, and incidental to selecting a temporary comparable 
replacement dwelling. Such payments may include the reasonable and 
necessary costs of temporarily moving personal property from the real 
property and returning to the real property. Storage of the personal 
property may be allowed when approved by the displacing agency;
    (5) A person's temporary move from their dwelling or business for 
the project may not exceed 12 months. The agency must contact any 
person who has temporarily moved from their dwelling or business when 
that temporary move has lasted for a period beyond 12 months because 
that person is considered permanently displaced and eligible as a 
displaced person. The agency shall offer such eligible persons all 
required relocation assistance benefits and services for permanently 
displaced persons. An agency may not deduct any temporary relocation 
assistance benefits previously provided when determining permanent 
relocation benefits eligibility; and
    (6) A person who is not lawfully present in the United States and 
who has been determined to be ineligible for relocation assistance in 
accordance with Sec.  24.208 is not eligible for temporary relocation 
assistance unless such denial of benefits would create an extremely 
unusual hardship to a designated family member in accordance with Sec.  
24.208(h).
    (b) [Reserved]


Sec.  24.203  Relocation notices.

    (a) General information notice. As soon as feasible, a person who 
may be displaced or who may be required to move temporarily shall be 
furnished with a general written description of the agency's relocation 
program which does at least the following:
    (1) Informs the person that he or she may be displaced (or, if 
appropriate, required to move temporarily from his or her unit) for the 
project and generally describes the relocation payment(s) for which the 
person may be eligible, the basic conditions of eligibility, and the 
procedures for obtaining the payment(s);
    (2) Informs the displaced person (or person required to move 
temporarily from his or her unit, if appropriate) that he or she will 
be given reasonable relocation advisory services, including referrals 
to replacement properties, help in filing payment claims, and other 
necessary assistance to help the displaced person successfully 
relocate;
    (3) Informs the displaced person (or person required to move 
temporarily from his or her dwelling when required by the Federal 
funding agency) that he or she will not be required to move without at 
least 90 days advance written notice (see paragraph (c) of this 
section), and informs any person to be displaced from a dwelling, 
either permanently or temporarily (when required by the Federal funding 
agency), that he or she cannot be required to move unless at least one 
comparable replacement dwelling has been made available;
    (4) Informs the displaced person or person required to move 
temporarily that any person who is an alien not lawfully present in the 
United States is ineligible for relocation advisory services and 
relocation payments under this part, unless such ineligibility would 
result in exceptional and extremely unusual hardship to a qualifying 
spouse, parent, or child, pursuant to Sec.  24.208(h); and
    (5) Describes to the displaced person (or persons required to move 
temporarily) their right to appeal the agency's determination as to a 
person's application for assistance for which a person may be eligible 
under this part.
    (b) Notice of relocation eligibility. Eligibility for relocation 
assistance shall begin on the earliest of: the date of a notice of 
intent to acquire, rehabilitate, and/or demolish (described in 
paragraph (d) of this section); the initiation of negotiations (defined 
in Sec.  24.2(a)); the date that an agreement for

[[Page 36956]]

voluntary acquisition becomes binding (defined in Sec.  24.2(a)); or 
actual acquisition. When this occurs, the agency shall promptly notify 
all occupants in writing of their eligibility for applicable relocation 
assistance.
    (c) Ninety-day notice--(1) General. No lawful occupant shall be 
required to move unless he or she has received at least 90 days advance 
written notice of the earliest date by which he or she may be required 
to move.
    (2) Timing of notice. The agency may issue the notice 90 days or 
earlier before it expects the person to be displaced.
    (3) Content of notice. The 90-day notice shall either state a 
specific date as the earliest date by which the occupant may be 
required to move, or state that the occupant will receive a further 
notice indicating, at least 30 days in advance, the specific date by 
which he or she must move. If the 90-day notice is issued before a 
comparable replacement dwelling is made available, the notice must 
state clearly that the occupant will not have to move earlier than 90 
days after such a dwelling is made available. (See Sec.  24.204(a).)
    (4) Urgent need. In unusual circumstances, an occupant may be 
required to vacate the property on less than 90 days advance written 
notice if the agency determines that a 90-day notice is impracticable, 
such as when the person's continued occupancy of the property would 
constitute a substantial danger to health or safety. A copy of the 
agency's determination shall be included in the applicable case file.
    (d) Notice of intent to acquire, rehabilitate, and/or demolish. A 
notice of intent to acquire, rehabilitate, and/or demolish is an 
agency's written communication that is provided to a person to be 
displaced, including persons required to temporarily move, which 
clearly sets forth that the agency intends to acquire, rehabilitate, 
and/or demolish the property. A notice of intent to acquire, 
rehabilitate, and/or demolish establishes eligibility for relocation 
assistance prior to the initiation of negotiations and/or prior to the 
commitment of Federal financial assistance to the activity. (See Sec.  
24.2 (a).)


Sec.  24.204  Availability of comparable replacement dwelling before 
displacement.

    (a) General. No person to be permanently displaced shall be 
required to move from his or her dwelling unless at least one 
comparable replacement dwelling (defined at Sec.  24.2(a)) has been 
made available to the person. Information on comparable replacement 
dwellings that were used in the determination process must be provided 
to permanently displaced persons. When possible, three or more 
comparable replacement dwellings shall be made available. A comparable 
replacement dwelling will be considered to have been made available to 
a person, if:
    (1) The person is informed in writing of its location;
    (2) The person has sufficient time to negotiate and enter into a 
purchase or lease agreement for the property; and
    (3) Subject to reasonable safeguards, the person is assured of 
receiving the relocation assistance and acquisition payment to which 
the person is entitled in sufficient time to complete the purchase or 
lease of the property.
    (b) Circumstances permitting waiver. The Federal agency funding the 
project may grant a waiver of the requirement in paragraph (a) of this 
section in any case where it is demonstrated that a person must move 
because of:
    (1) A major disaster as defined in section 102 of the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act, as amended (42 
U.S.C. 5122);
    (2) A presidentially declared national emergency; or
    (3) Another emergency which requires immediate vacation of the real 
property, such as when continued occupancy of the displacement dwelling 
constitutes a substantial danger to the health or safety of the 
occupants or the public.
    (c) Basic conditions of emergency move. Whenever a person to be 
displaced is required to move from the displacement dwelling for a 
temporary period because of an emergency as described in paragraph (b) 
of this section, the agency shall:
    (1) Take whatever steps are necessary to assure that the person who 
is required to move from their dwelling is relocated to a DSS dwelling;
    (2) Pay the actual reasonable out-of-pocket moving expenses and any 
reasonable increase in rent and utility costs incurred in connection 
with the emergency move; and
    (3) Make available to the displaced person as soon as feasible, at 
least one comparable replacement dwelling. (For purposes of filing a 
claim and meeting the eligibility requirements for a relocation 
payment; the date of displacement is the date the person moves from 
their dwelling due to the emergency.)


Sec.  24.205  Relocation planning, advisory services, and coordination.

    (a) Relocation planning. During the early stages of development, an 
agency shall plan Federal and federally assisted programs or projects 
in such a manner that recognizes the problems associated with the 
displacement of individuals, families, businesses, farms, and nonprofit 
organizations and develop solutions to minimize the adverse impacts of 
displacement. Such planning, where appropriate, shall precede any 
action by an agency which will cause displacement, and should be scoped 
to the complexity and nature of the anticipated displacing activity 
including an evaluation of program resources available to carry out 
timely and orderly relocations. Planning may involve a relocation 
survey or study, which may include the following:
    (1) An estimate of the number of households to be displaced 
including information such as owner/tenant status, estimated value and 
rental rates of properties to be acquired, family characteristics, and 
special consideration of the impacts on minorities, the elderly, large 
families, and persons with disabilities when applicable.
    (2) An estimate of the number of comparable replacement dwellings 
in the area (including price ranges and rental rates) that are expected 
to be available to fulfill the needs of those households permanently or 
temporarily displaced. When an adequate supply of comparable housing is 
not expected to be available, the agency should consider housing of 
last resort actions.
    (3) An estimate of the number, type, and size of the businesses, 
farms, and nonprofit organizations to be displaced and the approximate 
number of employees that may be affected.
    (4) An estimate of the availability of replacement business sites. 
When an adequate supply of replacement business sites is not expected 
to be available, the impacts of displacing or temporarily moving the 
businesses should be considered and addressed. Planning for permanently 
and temporarily displaced businesses which are reasonably expected to 
involve complex or lengthy moving processes or small businesses with 
limited financial resources and/or few alternative relocation sites 
should include an analysis of business moving problems.
    (5) Consideration of any special relocation advisory services that 
may be necessary from the agency displacing a person and other 
cooperating agencies.
    (b) Loans for planning and preliminary expenses. In the event that 
an agency elects to consider using the duplicative provision in section 
4635 of the Uniform Act which permits the use of project funds for 
loans to cover planning and other preliminary expenses for the 
development of additional housing, the Lead Agency

[[Page 36957]]

will establish criteria and procedures for such use upon the request of 
the Federal Agency funding the program or project.
    (c) Relocation assistance advisory services--(1) General. The 
agency shall carry out a relocation assistance advisory program which 
satisfies the requirements of title VI of the Civil Rights Act of 1964 
(42 U.S.C. 2000d et seq.), title VIII of the Civil Rights Act of 1968 
(42 U.S.C. 3601 et seq., as amended.), and Executive Order 11063 (3 
CFR, 1959-1963 Comp., p. 652), and offer the services described in 
paragraph (c)(2) of this section. If the agency determines that a 
person occupying property adjacent to the real property acquired for 
the project is caused substantial economic injury because of such 
acquisition, it may offer advisory services to such person.
    (2) Services to be provided. The advisory program shall include 
such measures, facilities, and services as may be necessary or 
appropriate in order to:
    (i) Determine, for nonresidential (businesses, farm, and nonprofit 
organizations) displacements, the relocation needs and preferences of 
each business (farm and nonprofit organization) to be displaced or, 
when determined to be necessary by the funding agency, temporarily 
displaced and explain the relocation payments and other assistance for 
which the business may be eligible, the related eligibility 
requirements, and the procedures for obtaining such assistance. This 
shall include a personal interview with each business. At a minimum, 
interviews with displaced business owners and operators should include 
the following items:
    (A) The business's replacement site requirements, current lease 
terms and other contractual obligations and the financial capacity of 
the business to accomplish the move.
    (B) Determination of the need for outside specialists in accordance 
with Sec.  24.301(g)(13) that will be required to assist in planning 
the move, assistance in the actual move, and in the reinstallation of 
machinery and/or other personal property.
    (C) For businesses, an identification and resolution of personalty 
and/or realty issues. Every effort must be made to identify and resolve 
personalty and/or realty issues prior to, or at the time of, the 
appraisal of the property.
    (D) An estimate of the time required for the business to vacate the 
site.
    (E) An estimate of the anticipated difficulty in locating a 
replacement property.
    (F) An identification of any advance relocation payments required 
for the move, and the agency's legal capacity to provide them.
    (ii) Determine, for residential displacements, the relocation needs 
and preferences of each person to be displaced, or temporarily 
displaced when the funding agency determines it to be necessary, and 
explain the relocation payments and other assistance for which the 
person may be eligible, the related eligibility requirements, and the 
procedures for obtaining such assistance. This shall include a personal 
interview with each residential displaced person and, when the funding 
agency determines it to be necessary, each temporarily displaced 
person.
    (A) Provide current and continuing information on the availability, 
purchase prices, and rental costs of comparable replacement dwellings, 
and explain that the person cannot be required to move unless at least 
one comparable replacement dwelling is made available as set forth in 
Sec.  24.204(a).
    (B) As soon as feasible, the agency shall inform the person in 
writing of the specific comparable replacement dwelling and the price 
or rent used for establishing the upper limit of the replacement 
housing payment (see Sec.  24.403(a) and (b)) and the basis for the 
determination, so that the person is aware of the maximum replacement 
housing payment for which he or she may qualify.
    (C) Where feasible, comparable housing shall be inspected prior to 
being made available to assure that it meets applicable standards (see 
Sec.  24.2(a).) If such an inspection is not made, the agency shall 
notify the person to be displaced in writing of the reason that an 
inspection of the comparable was not made and, that if the comparable 
is purchased or rented by the displaced person, a replacement housing 
payment may not be made unless the replacement dwelling is subsequently 
inspected and determined to be decent, safe, and sanitary. (See 
appendix A to this part, section 24.205(c)(2)(ii)(C).)
    (D) Whenever possible, minority persons, including those 
temporarily displaced, shall be given reasonable opportunities to 
relocate to decent, safe, and sanitary replacement dwellings, not 
located in an area of minority concentration, that are within their 
financial means. This does not require an agency to provide a person a 
larger payment than is necessary to enable a person to relocate to a 
comparable replacement dwelling. (See appendix A to this part, section 
24.205(c)(2)(ii)(D).)
    (E) The agency shall offer all persons transportation to inspect 
housing to which they are referred.
    (F) Any displaced person that may be eligible for Government 
housing assistance at the replacement dwelling shall be advised of any 
requirements of such Government housing assistance program that would 
limit the size of the replacement dwelling (see Sec.  24.2(a)), as well 
as of the long-term nature of such rent subsidy, and the limited (42 
month) duration of the relocation rental assistance payment.
    (iii) Provide, for nonresidential moves, current and continuing 
information on the availability, purchase prices, and rental costs of 
suitable commercial and farm properties and locations. Assist any 
person displaced from a business or farm operation to obtain and become 
established in a suitable replacement location.
    (iv) Minimize hardships to persons in adjusting to relocation by 
providing counseling, advice as to other sources of assistance that may 
be available, and such other help as may be appropriate.
    (v) Supply persons to be displaced with appropriate information 
concerning Federal and State housing programs, disaster loan and other 
programs administered by the Small Business Administration, and other 
Federal and State programs offering assistance to displaced persons, 
and technical help to persons applying for such assistance.
    (d) Coordination of relocation activities. Relocation activities 
shall be coordinated with project work and other displacement-causing 
activities to ensure that, to the extent feasible, persons displaced 
receive consistent treatment and the duplication of functions is 
minimized. (See Sec.  24.6.)
    (e) Subsequent occupants. Any person who occupies property acquired 
by an agency, when such occupancy began subsequent to the acquisition 
of the property, and the occupancy is permitted by a short-term rental 
agreement or an agreement subject to termination when the property is 
needed for a program or project, shall be eligible for advisory 
services, as determined by the agency.


Sec.  24.206  Eviction for cause.

    (a) Eviction for cause must conform to applicable Federal, State, 
and local law. Any person who occupies the real property and is in 
lawful occupancy on the date of the initiation of negotiations is 
presumed to be entitled to relocation payments and other assistance set 
forth in this part unless the agency determines that:

[[Page 36958]]

    (1) The person received an eviction notice prior to the initiation 
of negotiations and as a result of that notice is later evicted; or
    (2) The person is evicted after the initiation of negotiations for 
serious or repeated violation of material terms of the lease or 
occupancy agreement; and
    (3) In either case the eviction was not undertaken for the purpose 
of evading the obligation to make available the payments and other 
assistance set forth in this part.
    (b) For purposes of determining eligibility for relocation 
payments, the date of displacement is the date the person moves, or if 
later, the date a comparable replacement dwelling is made available. 
This section applies only to persons who would otherwise have been 
displaced by the project. (See appendix A to this part, section 
24.206.)


Sec.  24.207  General requirements--claims for relocation payments.

    (a) Documentation. Any claim for a relocation payment shall be 
supported by such documentation as may be reasonably required to 
support expenses incurred, such as bills, certified prices, appraisals, 
or other evidence of such expenses. A displaced person or person 
required to move temporarily must be provided reasonable assistance 
necessary to complete and file any required claim for payment.
    (b) Expeditious payments. The agency shall review claims in an 
expeditious manner. The claimant shall be promptly notified as to any 
additional documentation that is required to support the claim. Payment 
for a claim shall be made as soon as feasible following receipt of 
sufficient documentation to support the claim.
    (c) Advanced payments. If a person demonstrates the need for an 
advanced relocation payment in order to avoid or reduce a hardship, the 
agency shall issue the payment, subject to such safeguards as are 
appropriate to ensure that the objective of the payment is 
accomplished.
    (d) Time for filing. (1) All claims for a relocation payment shall 
be filed with the agency no later than 18 months after:
    (i) For tenants, the date of displacement or temporary move.
    (ii) For owners, the date of displacement or the date of the final 
payment for the acquisition of the real property, whichever is later.
    (2) The agency shall waive this time period for good cause.
    (e) Notice of denial of claim. If the agency disapproves all or 
part of a payment claimed or refuses to consider the claim on its 
merits because of untimely filing or other grounds, it shall promptly 
notify the claimant in writing of its determination, the basis for its 
determination, and the procedures for appealing that determination.
    (f) No waiver of relocation assistance. An agency shall not propose 
or request that a person waive his or her rights or entitlements to 
relocation assistance and benefits provided by the Uniform Act and this 
part. (See appendix A to this part, section 24.207(f).)
    (g) Expenditure of payments. Payments, provided pursuant to this 
part, shall not be considered to constitute Federal financial 
assistance. Accordingly, this part does not apply to the expenditure of 
such payments by, or for, a displaced person.
    (h) Deductions from relocation payments. An agency shall deduct the 
amount of any advance relocation payment from the relocation payment(s) 
to which a person is otherwise entitled. The agency shall not withhold 
any part of a relocation payment to a person to satisfy any other 
obligation.


Sec.  24.208  Aliens not lawfully present in the United States.

    (a) Each person seeking relocation payments or relocation advisory 
assistance shall, as a condition of eligibility, certify:
    (1) In the case of an individual, that they are a citizen, or an 
alien who is lawfully present in the United States.
    (2) In the case of a family, that each family member is a citizen 
or an alien who is lawfully present in the United States. The 
certification may be made by the head of the household on behalf of 
other family members.
    (3) In the case of an unincorporated business, farm, or nonprofit 
organization, that each owner is a citizen or an alien who is lawfully 
present in the United States. The certification may be made by the 
principal owner, manager, or operating officer on behalf of other 
persons with an ownership interest.
    (4) In the case of an incorporated business, farm, or nonprofit 
organization, that the corporation is authorized to conduct business 
within the United States.
    (b) The certification provided pursuant to paragraphs (a)(1) 
through (3) of this section shall specify the person's status as a 
citizen or an alien who is lawfully present in the United States. 
Requirements concerning the certification in addition to those 
contained in this section shall be within the discretion of the Federal 
funding agency and, within those parameters, that of the agency 
carrying out such displacements.
    (c) In computing relocation payments under the Uniform Act, if any 
member(s) of a household or owner(s) of an unincorporated business, 
farm, or nonprofit organization is (are) determined to be ineligible 
because of a failure to be lawfully present in the United States, no 
relocation payments may be made to him or her. Any payment(s) for which 
such household, unincorporated business, farm, or nonprofit 
organization would otherwise be eligible shall be computed for the 
household, based on the number of eligible household members and for 
the unincorporated business, farm, or nonprofit organization, based on 
the ratio of ownership between eligible and ineligible owners. (See 
appendix A to this part, section 24.208(c).)
    (d) The agency shall consider the certification provided pursuant 
to paragraph (a) of this section to be valid, unless the agency 
determines in accordance with paragraph (f) of this section that it is 
invalid based on a review of documentation or other information that 
the agency considers reliable and appropriate.
    (e) Any review by the agency of the certifications provided 
pursuant to paragraph (a) of this section shall be conducted in a 
nondiscriminatory fashion. Each agency will apply the same standard of 
review to all such certifications it receives, except that such 
standard may be revised periodically.
    (f) If, based on a review of a person's documentation or other 
credible evidence, an agency has reason to believe that a person's 
certification is invalid (for example a document reviewed does not on 
its face reasonably appear to be genuine), and that, as a result, such 
person may be an alien not lawfully present in the United States, it 
shall obtain the following information before making a final 
determination:
    (1) For a person who has certified that they are an alien lawfully 
present in the United States, the agency shall obtain verification of 
the person's status by using the Systematic Alien Verification for 
Entitlements (SAVE) program administered by USCIS to verify immigration 
status.
    (2) For a person who has certified that they are a citizen or 
national, if the agency has reason to believe that the certification is 
invalid, the agency shall request evidence of United States citizenship 
or nationality and, if considered necessary, verify the accuracy of 
such evidence with the issuer or other appropriate source.
    (g) No relocation payments or relocation advisory assistance shall 
be provided to a person who has not

[[Page 36959]]

provided the certification described in this section or who has been 
determined to be not lawfully present in the United States, unless such 
person can demonstrate to the agency's satisfaction that the denial of 
relocation assistance will result in an exceptional and extremely 
unusual hardship to such person's spouse, parent, or child who is a 
citizen of the United States or an alien lawfully admitted for 
permanent residence in the United States.
    (h) For purposes of paragraph (g) of this section, ``exceptional 
and extremely unusual hardship'' to such spouse, parent, or child of 
the person not lawfully present in the United States means that the 
denial of relocation payments and advisory assistance to such person 
will directly result in (see appendix A to this part, section 
24.208(h)):
    (1) A significant and demonstrable adverse impact on the health or 
safety of such spouse, parent, or child;
    (2) A significant and demonstrable adverse impact on the continued 
existence of the family unit of which such spouse, parent, or child is 
a member; or
    (3) Any other impact that the agency determines will have a 
significant and demonstrable adverse impact on such spouse, parent, or 
child.
    (i) The certification referred to in paragraph (a) of this section 
may be included as part of the claim for relocation payments described 
in Sec.  24.207.
    (Approved by the Office of Management and Budget under control 
number 2105-0508.)


Sec.  24.209  Relocation payments not considered as income.

    No relocation payment received by a displaced person or person 
required to move temporarily under this part shall be considered as 
income for the purpose of the Internal Revenue Code of 1954, which has 
been redesignated as the Internal Revenue Code of 1986 (title 26, 
U.S.C.), or for the purpose of determining the eligibility or the 
extent of eligibility of any person for assistance under the Social 
Security Act (42 U.S.C. 301 et seq.) or any other Federal law, except 
for any Federal law providing low-income housing assistance.

Subpart D--Payments for Moving and Related Expenses


Sec.  24.301  Payment for actual reasonable moving and related 
expenses.

    (a) General. (1) Any owner-occupant or tenant who qualifies as a 
displaced person (defined at Sec.  24.2(a)) and who moves from a 
dwelling (including a mobile home) or who moves from a business, farm, 
or nonprofit organization is entitled to payment of his or her actual 
moving and related expenses, as the agency determines to be reasonable 
and necessary.
    (2) A non-occupant owner of a rented mobile home is eligible for 
actual cost reimbursement under this section to relocate the mobile 
home. If the mobile home is not acquired as real estate, but the 
homeowner-occupant obtains a replacement housing payment under one of 
the circumstances described at Sec.  24.502(a)(3), the homeowner-
occupant is not eligible for payment for moving the mobile home but may 
be eligible for a payment for moving personal property from the mobile 
home.
    (b) Moves from a dwelling. A displaced person's actual, reasonable, 
and necessary moving expenses for moving personal property from a 
dwelling may be determined based on the cost of one, or a combination 
of the methods in paragraphs (b)(1) and (2) of this section (eligible 
expenses for moves from a dwelling include the expenses described in 
paragraphs (g)(1) through (7) of this section):
    (1) Commercial move. Moves performed by a professional mover.
    (2) Self-move. Moves that may be performed by the displaced person 
in one or a combination of the following methods:
    (i) Fixed Residential Moving Cost Schedule. The Fixed Residential 
Moving Cost Schedule described in Sec.  24.302.
    (ii) Actual cost move. Supported by receipted bills for labor and 
equipment. Hourly labor rates should not exceed the cost paid by a 
commercial mover for moving staff necessary for moving the residential 
personal property. Costs for moving personal property that requires 
special handling should not exceed the hourly market rate for a 
commercial specialist. Equipment rental fees should be based on the 
actual cost of renting the equipment but not exceed the cost paid by a 
commercial mover.
    (iii) A moving cost estimate. Prepared by a qualified agency staff 
person, as developed from the agency's thorough review of the personal 
property to be moved and documented costs for materials, equipment, and 
labor. Hourly labor rates should not exceed the cost paid by a 
commercial mover for moving staff. Costs for moving residential 
personal property that requires special handling should not exceed the 
hourly rate for a commercial specialist. Equipment rental fees should 
be based on the actual cost of renting the equipment but not exceed the 
cost paid by a commercial mover. The cost of materials should equal 
those readily available locally.
    (iv) Commercial mover estimate. Based on the lower of two bids from 
a commercial mover. Federal funding agencies may establish policies and 
procedures which require its grantees to calculate and subtract an 
estimated amount of overhead and profit from the moving cost bids to 
establish a reimbursement eligibility.
    (c) Moves from a mobile home. Eligible expenses for moves from a 
mobile home include those expenses described in paragraphs (g)(1) 
through (7) of this section. In addition to the items in paragraph (a) 
of this section, the owner-occupant of a mobile home that is moved as 
personal property and used as the person's replacement dwelling, is 
also eligible for the moving expenses described in paragraphs (g)(8) 
through (10) of this section. A displaced person's actual, reasonable, 
and necessary moving expenses for moving personal property from a 
mobile home may be determined based on the cost of one, or a 
combination of the following methods:
    (1) Commercial move. Moves performed by a professional mover.
    (2) Self-move. Moves that may be performed by the displaced person 
in one or a combination of the following methods:
    (i) Fixed Residential Moving Cost Schedule. The Fixed Residential 
Moving Cost Schedule described in Sec.  24.302.
    (ii) Actual cost move. Supported by receipted bills for labor and 
equipment. Hourly labor rates should not exceed the cost paid by a 
commercial mover for moving staff necessary for moving the residential 
personal property. Costs for moving personal property that requires 
special handling should not exceed the hourly market rate for a 
commercial specialist. Equipment rental fees should be based on the 
actual cost of renting the equipment but not exceed the cost paid by a 
commercial mover.
    (iii) A moving cost estimate. Prepared by a qualified agency staff 
person, as developed from the agency's thorough review of the personal 
property to be moved, and documented estimated costs for materials, 
equipment, and labor. Hourly labor rates should not exceed the cost 
paid by a commercial mover for moving staff. Costs for moving 
residential personal property that requires special handling should not 
exceed the hourly rate for a commercial specialist. Equipment rental 
fees should be based on the actual cost of renting the equipment but 
not exceed the cost paid by a commercial mover. The cost

[[Page 36960]]

of materials should equal those readily available locally.
    (iv) Commercial mover estimate. Based on the lower of two bids from 
a commercial mover. Federal funding agencies may establish policies and 
procedures which require its grantees to calculate and subtract an 
estimated amount of overhead and profit from the moving cost bids to 
establish a reimbursement eligibility.
    (d) Moves from a business, farm, or nonprofit organization. 
Eligible expenses for moves from a business, farm, or nonprofit 
organization include those expenses described in paragraphs (g)(1) 
through (7) and (11) through (18) of this section and Sec.  24.303. 
Personal property as determined by an inventory from a business, farm, 
or nonprofit organization may be moved by one or a combination of the 
following methods:
    (1) Commercial move. Based on the lower of two bids or estimates 
prepared by a commercial mover. At the agency's discretion, payment for 
a low cost or uncomplicated move may be based on a single bid or 
estimate.
    (2) Self-move. A self-move payment may be based on one or a 
combination of the following:
    (i) The lower of two bids or estimates prepared by a commercial 
mover or qualified agency staff person. At the agency's discretion, 
payment for a low cost or uncomplicated move may be based on a single 
bid or estimate; or
    (ii) Supported by receipted bills for labor and equipment. Hourly 
labor rates should not exceed the rates paid by a commercial mover to 
employees performing the same activity and, equipment rental fees 
should be based on the actual rental cost of the equipment but not to 
exceed the cost paid by a commercial mover.
    (iii) A qualified agency staff person may develop a move cost 
finding by estimating and determining the cost of a small uncomplicated 
nonresidential personal property move of $5,000 or less, with the 
written consent of the person. This estimate may include only the cost 
of moving personal property which does not require disconnect and 
reconnect and/or specialty moving services necessary for activities 
including crating, lifting, transportation, and setting of the item in 
place.
    (e) Personal property only. Eligible expenses for a person who is 
required to move personal property from real property but is not 
required to move from a dwelling (including a mobile home), business, 
farm, or nonprofit organization include those expenses described in 
paragraphs (g)(1) through (7) and (18) of this section. (See appendix A 
to this part, section 24.301(e).)
    (f) Advertising signs. The amount of a payment for direct loss of 
an advertising sign, which is personal property shall be the lesser of:
    (1) The depreciated reproduction cost of the sign, as determined by 
the agency, less the proceeds from its sale; or
    (2) The estimated cost of moving the sign, but with no allowance 
for storage.
    (g) Eligible actual moving expenses. (1) Transportation of the 
displaced person and personal property. Transportation costs for a 
distance beyond 50 miles are not eligible, unless the agency determines 
that relocation beyond 50 miles is justified.
    (2) Packing, crating, unpacking, and uncrating of the personal 
property.
    (3) Disconnecting, dismantling, removing, reassembling, and 
reinstalling relocated household appliances and other personal 
property. For businesses, farms, or nonprofit organizations this 
includes machinery, equipment, substitute personal property, and 
connections to utilities available within the building; it also 
includes modifications to the personal property, including those 
mandated by Federal, State, or local law, code, or ordinance, necessary 
to adapt it to the replacement structure, the replacement site, or the 
utilities at the replacement site, and modifications necessary to adapt 
the utilities at the replacement site to the personal property.
    (4) An agency may determine that the storage of personal property 
is a reasonable and necessary moving expense for a displaced person or 
person required to move temporarily under this part. Agencies may 
approve a payment for storage when the process of relocating from the 
acquired site to the replacement site is delayed for reasons beyond the 
control of the displaced person. Storage may not be longer than 12 
months, starting at the date of vacation from the acquired site and 
ending when the replacement site becomes available. Agencies may 
approve storage for more than 12 months in unusual instances as 
justified, documented, and approved by the agency.
    (5) Insurance for the replacement value of the property in 
connection with the move and necessary storage.
    (6) The replacement value of property lost, stolen, or damaged in 
the process of moving (not through the fault or negligence of the 
displaced person, his or her agent, or employee) where insurance 
covering such loss, theft, or damage is not reasonably available.
    (7) A displaced tenant is entitled to reasonable reimbursement, as 
determined by the agency, for actual expenses not to exceed $1,000, 
incurred for rental replacement dwelling application fees or credit 
reports required to lease a replacement dwelling.
    (8) Other moving-related expenses that are not listed as ineligible 
under paragraph (h) of this section, as the agency determines to be 
reasonable and necessary.
    (9) The reasonable cost of disassembling, moving, and reassembling 
any appurtenances attached to a mobile home, such as porches, decks, 
skirting, and awnings, which were not acquired, anchoring of the unit, 
and utility ``hookup'' charges.
    (10) The reasonable cost of repairs and/or modifications so that a 
mobile home can be moved and/or made decent, safe, and sanitary.
    (11) The cost of a nonrefundable mobile home park entrance fee, to 
the extent it does not exceed the fee at a comparable mobile home park, 
if the person is displaced or temporarily moved from a mobile home park 
or the agency determines that payment of the fee is necessary to effect 
relocation.
    (12) Any actual, reasonable, or necessary costs of a license, 
permit, fee, or certification required of the displaced person to 
operate a business, farm, or nonprofit at the replacement location. 
However, the payment may be based on the remaining useful life of the 
existing license, permit, fees, or certification.
    (13) Professional services as the agency determines to be actual, 
reasonable, and necessary for:
    (i) Planning the move of the personal property;
    (ii) Moving the personal property; and
    (iii) Installing the relocated personal property at the replacement 
location.
    (14) Relettering signs, replacing stationery on hand at the time of 
displacement or temporary move, and making reasonable and necessary 
updates to other media that are made obsolete as a result of the move. 
(See appendix A to this part, section 24.301(g)(14).)
    (15) Actual direct loss of tangible personal property incurred as a 
result of moving or discontinuing the business or farm operation. The 
payment shall consist of:
    (i) If the item is currently in use, the lesser of:
    (A) The estimated cost to move the item up to 50 miles and 
reinstall; or
    (B) The fair market value in place of the item, as is for continued 
use, less the proceeds from its sale. To be eligible for payment, the 
claimant must make a good faith effort to sell the personal

[[Page 36961]]

property, unless the agency determines that such effort is not 
necessary.
    (ii) If the item is not currently in use: The estimated cost of 
moving the item 50 miles, as is.
    (iii) When payment for property loss is claimed for goods held for 
sale, the fair market value shall be based on the cost of the goods to 
the business, not the potential selling prices. (See appendix A of this 
part, section 24.301(g)(15).)
    (16) The reasonable cost incurred in attempting to sell an item 
that is not to be relocated.
    (17) If an item of personal property, which is used as part of a 
business or farm operation is not moved but is promptly replaced with a 
substitute item that performs a comparable function at the replacement 
site, the displaced person is entitled to payment of the lesser of:
    (i) The cost of the substitute item, including installation costs 
of the replacement site, minus any proceeds from the sale or trade-in 
of the replaced item; or
    (ii) The estimated cost of moving and reinstalling the replaced 
item but with no allowance for storage. At the agency's discretion, the 
estimated cost for a low cost or uncomplicated move may be based on a 
single bid or estimate.
    (18) Searching for a replacement location.
    (i) A business or farm operation is entitled to reimbursement for 
actual expenses, not to exceed $5,000, as the agency determines to be 
reasonable, which are incurred in searching for a replacement location, 
including:
    (A) Transportation;
    (B) Meals and lodging away from home;
    (C) Time spent searching, based on reasonable salary or earnings;
    (D) Fees paid to a real estate agent or broker to locate a 
replacement site, exclusive of any fees or commissions related to the 
purchase of such sites;
    (E) Time spent in obtaining permits and attending zoning hearings; 
and
    (F) Expenses negotiating the purchase of a replacement site based 
on a reasonable salary or fee, including actual, reasonable, and 
necessary attorney's fees.
    (ii) The Federal funding agency may, on a program wide or project 
basis, allow a one-time payment of $1,000 for search expenses with 
minimal or no documentation as an alternative payment method to 
paragraph (g)(18)(i) of this section. (See appendix A to this part, 
section 24.301(g)(18).)
    (19) When the personal property to be moved is of low value and 
high bulk, and the cost of moving the property would be 
disproportionate to its value in the judgment of the agency, the 
allowable moving cost payment shall not exceed the lesser of: the 
amount which would be received if the property were sold at the site; 
or the replacement cost of a comparable quantity delivered to the new 
business location. Examples of personal property covered by this 
paragraph (g)(19) include, but are not limited to, stockpiled sand, 
gravel, minerals, metals, and other similar items of personal property 
as determined by the agency.
    (h) Ineligible moving and related expenses. The following is a 
nonexclusive listing of payments a displaced person is not entitled to:
    (1) The cost of moving any structure or other real property 
improvement in which the displaced person reserved ownership. (However, 
this part does not preclude the computation under Sec.  
24.401(c)(2)(iii));
    (2) Interest on a loan to cover moving expenses;
    (3) Loss of goodwill;
    (4) Loss of profits;
    (5) Loss of trained employees;
    (6) Any additional operating expenses of a business or farm 
operation incurred because of operating in a new location except as 
provided in Sec.  24.304(a)(6);
    (7) Personal injury;
    (8) Any legal fee or other cost for preparing a claim for a 
relocation payment or for representing the claimant before the agency;
    (9) Expenses for searching for a temporary or replacement dwelling 
which include costs for mileage, meals, lodging, time and professional 
real estate broker or attorney's fees;
    (10) Physical changes to the real property at the temporary or 
replacement location of a business or farm operation except as provided 
in paragraph (g)(3) of this section and Sec.  24.304(a);
    (11) Costs for storage of personal property on real property 
already owned or leased by the displaced person or person to be moved 
temporarily;
    (12) Refundable security and utility deposits; and
    (13) Cosmetic changes to a replacement or temporary dwelling, which 
are not required by State or local law, such as painting, draperies, or 
replacement carpet or flooring.
    (i) Notification and inspection (nonresidential). The agency shall 
inform the displaced person and persons required to move temporarily, 
in writing, of the requirements of this section as soon as possible 
after the initiation of negotiations. This information may be included 
in the relocation information provided the person as set forth in Sec.  
24.203. To be eligible for payments under this section the person must:
    (1) Provide the agency reasonable advance notice of the approximate 
date of the start of the move or disposition of the personal property 
and an inventory of the items to be moved. However, the agency may 
waive this notice requirement after documenting its file accordingly.
    (2) Permit the agency to make reasonable and timely inspections of 
the personal property at both the displacement and replacement sites 
and to monitor the move.
    (j) Transfer of ownership (nonresidential). Upon request and in 
accordance with applicable law, the claimant shall transfer to the 
agency ownership of any personal property that has not been moved, 
sold, or traded in.


Sec.  24.302  Fixed payment for moving expenses--residential moves.

    Any person displaced from a dwelling or a seasonal residence or a 
dormitory style room is entitled to receive a fixed moving cost payment 
as an alternative to a payment for actual moving and related expenses 
under Sec.  24.301. This payment shall be determined according to the 
Fixed Residential Moving Cost Schedule approved by FHWA and published 
in the Federal Register on a periodic basis. The payment to a person 
with minimal personal possessions who is in occupancy of a dormitory 
style room or a person whose residential move is performed by an agency 
at no cost to the person shall be limited to the amount stated in the 
most recent edition of the Fixed Residential Moving Cost Schedule. In 
addition, an agency may approve storage for a displaced person's 
personal property for a period of up 12 months as a reasonable, actual 
and necessary moving expense under Sec.  24.301(g)(4).
    (a) An agency may determine that the storage of personal property 
is a reasonable and necessary moving expense for a displaced person 
under this part. The determination shall be based on the needs of the 
displaced person; the nature of the move; the plans for permanent 
relocation; the amount of time available for the relocation process; 
and, whether storage will facilitate relocation. If the agency 
determines that storage is reasonable and necessary in conjunction with 
a fixed cost moving payment made under this section, the agency shall 
pay the actual, reasonable, and necessary storage expenses in 
accordance with Sec.  24.301(g)(4). However, regardless of whether 
storage is approved, the Fixed Residential Move Cost Schedule

[[Page 36962]]

provides a one-time payment for one move from the displacement dwelling 
to the replacement dwelling, or storage facility. Consequently, 
displaced persons must be fully informed that reimbursement of costs to 
move the personal property to storage and the cost of approved storage, 
if applicable, represent a full reimbursement of their eligibility for 
moving costs under this part. (See appendix A to this part, section 
24.302.)
    (b) [Reserved]
    (c) The Fixed Residential Moving Cost Schedule is available at the 
following URL: www.fhwa.dot.gov/real_estate/uniform_act/relocation/moving_cost_schedule.cfm.


Sec.  24.303  Related nonresidential eligible expenses.

    The following expenses, in addition to those provided by Sec.  
24.301 for moving personal property, shall be provided if the agency 
determines that they are actual, reasonable, and necessary:
    (a) Connection to available utilities from the replacement site's 
property line to improvements at the replacement site. (See appendix A 
to this part, Section 24.303(a).)
    (b) Professional services performed prior to the purchase or lease 
of a replacement site to determine its suitability for the displaced 
person's business operation including, but not limited to, soil testing 
or feasibility and marketing studies (excluding any fees or commissions 
directly related to the purchase or lease of such site). At the 
discretion of the agency a reasonable pre-approved hourly rate may be 
established. (See appendix A to this part, section 24.303(b).)
    (c) Impact fees and one-time assessments for anticipated heavy 
utility usage, as determined necessary by the agency. (See appendix A 
to this part, section 24.303(c).)


Sec.  24.304  Reestablishment expenses--nonresidential moves.

    In addition to the payments available under Sec. Sec.  24.301 and 
24.303, a small business, farm, or nonprofit organization is entitled 
to receive a payment, not to exceed $33,200, for expenses actually 
incurred in relocating and reestablishing such small business, farm, or 
nonprofit organization at a replacement site.
    (a) Eligible expenses. Reestablishment expenses must be reasonable 
and necessary, as determined by the agency. They include, but are not 
limited to, the following:
    (1) Repairs or improvements to the replacement real property as 
required by Federal, State, or local law, code, or ordinance.
    (2) Modifications to the replacement property to accommodate the 
business operation or make replacement structures suitable for 
conducting the business.
    (3) Construction and installation costs for exterior signing to 
advertise the business.
    (4) Redecoration or replacement of soiled or worn surfaces at the 
replacement site, such as paint, paneling, or carpeting.
    (5) Advertisement of replacement location.
    (6) Estimated increased costs of operation during the first 2 years 
at the replacement site for such items as:
    (i) Lease or rental charges;
    (ii) Personal or real property taxes;
    (iii) Insurance premiums; and
    (iv) Utility charges, excluding impact fees.
    (7) Other items that the agency considers essential to the 
reestablishment of the business.
    (b) Ineligible expenses. The following is a nonexclusive listing of 
reestablishment expenditures not considered to be reasonable, 
necessary, or otherwise eligible:
    (1) Purchase of capital assets, such as office furniture, filing 
cabinets, machinery, or trade fixtures.
    (2) Purchase of manufacturing materials, production supplies, 
product inventory, or other items used in the normal course of the 
business operation.
    (3) Interest on money borrowed to make the move or purchase the 
replacement property.
    (4) Payment to a part-time business in the home which does not 
contribute materially, defined at Sec.  24.2(a), to the household 
income.
    (5) Construction costs for a new building at the business 
replacement site, or costs to construct, reconstruct or rehabilitate an 
existing building. (See appendix A to this part, section 24.304(b)(5).)


Sec.  24.305  Fixed payment for moving expenses--nonresidential moves.

    (a) Business. A displaced business may be eligible to choose a 
fixed payment in lieu of the payments for both actual moving and 
related expenses, as well as actual reasonable reestablishment expenses 
provided by Sec. Sec.  24.301, 24.303, and 24.304. Such fixed payment, 
except for payment to a nonprofit organization, shall equal the average 
annual net earnings of the business, as computed in accordance with 
paragraph (e) of this section, but not less than $1,000 nor more than 
$53,200. The displaced business is eligible for the payment if the 
agency determines that:
    (1) The business owns or rents personal property which must be 
moved in connection with such displacement and for which an expense 
would be incurred in such move and the business vacates or relocates 
from its displacement site;
    (2) The business cannot be relocated without a substantial loss of 
its existing patronage (clientele or net earnings). A business is 
assumed to meet this test unless the agency determines that it will not 
suffer a substantial loss of its existing patronage;
    (3) The business is not part of a commercial enterprise having more 
than three other entities which are not being acquired by the agency, 
and which are under the same ownership and engaged in the same or 
similar business activities;
    (4) The business is not operated at a displacement dwelling solely 
for the purpose of renting such dwelling to others;
    (5) The business is not operated at the displacement site solely 
for the purpose of renting the site to others; and
    (6) The business contributed materially to the income of the 
displaced person during the 2 taxable years prior to displacement. (See 
Sec.  24.2(a).)
    (b) Determining the number of businesses. In determining whether 
two or more displaced legal entities constitute a single business, 
which is entitled to only one fixed payment, all pertinent factors 
shall be considered, including the extent to which:
    (1) The same premises and equipment are shared;
    (2) Substantially identical or interrelated business functions are 
carried out and business and financial affairs are commingled;
    (3) The entities are held out to the public, and to those 
customarily dealing with them, as one business; and
    (4) The same person or closely related persons own, control, or 
manage the affairs of the entities.
    (c) Farm operation. A displaced farm operation (defined at Sec.  
24.2(a)) may choose a fixed payment, in lieu of the payments for both 
actual moving as well as related expenses and actual reasonable 
reestablishment expenses, in an amount equal to its average annual net 
earnings as computed in accordance with paragraph (e) of this section, 
but not less than $1,000 nor more than $53,200. In the case of a 
partial acquisition of land, which was a farm operation before the 
acquisition, the fixed payment shall be made only if the agency 
determines that:

[[Page 36963]]

    (1) The acquisition of part of the land caused the operator to be 
displaced from the farm operation on the remaining land; or
    (2) The partial acquisition caused a substantial change in the 
nature of the farm operation.
    (d) Nonprofit organization. A displaced nonprofit organization may 
choose a fixed payment of $1,000 to $53,200, in lieu of the payments 
for both actual moving as well as related expenses and actual 
reasonable reestablishment expenses, if the agency determines that it 
cannot be relocated without a substantial loss of existing patronage 
(membership or clientele). A nonprofit organization is assumed to meet 
this test unless the agency demonstrates otherwise. Any payment in 
excess of $1,000 must be supported with financial statements for the 
two 12-month periods prior to the acquisition. The amount to be used 
for the payment is the average of 2 years annual gross revenues less 
administrative expenses. (See appendix A to this part, section 
24.305(d).)
    (e) Average annual net earnings of a business or farm operation. 
The average annual net earnings of a business or farm operation are 
one-half of its net earnings before Federal, State, and local income 
taxes during the 2 taxable years immediately prior to the taxable year 
in which it was displaced. If the business or farm was not in operation 
for the full 2 taxable years prior to displacement, net earnings shall 
be based on the actual period of operation at the displacement site 
during the 2 taxable years prior to displacement, projected to an 
annual rate (see appendix A to this part, section 24.305(e), for sample 
calculations). Average annual net earnings may be based upon a 
different period of time when the agency determines it to be more 
equitable. Net earnings include any compensation obtained from the 
business or farm operation by its owner, the owner's spouse, and 
dependents. The displaced person shall furnish the agency proof of net 
earnings through income tax returns, certified financial statements, or 
other reasonable evidence, which the agency determines is satisfactory. 
(See appendix A to this part, section 24.305(e).)


Sec.  24.306  Discretionary utility relocation payments.

    (a) Whenever a program or project undertaken by an agency causes 
the relocation of a utility facility (defined at Sec.  24.2(a)) and the 
relocation of the facility creates extraordinary expenses for its 
owner, the agency may, at its option, make a relocation payment to the 
owner for all or part of such expenses, if the following criteria are 
met:
    (1) The utility facility legally occupies State or local government 
property, or property over which the State or local government has an 
easement or right-of-way;
    (2) The utility facility's right of occupancy thereon is pursuant 
to State law or local ordinance specifically authorizing such use, or 
where such use and occupancy has been granted through a franchise, use 
and occupancy permit, or other similar agreement;
    (3) Relocation of the utility facility is required by and is 
incidental to the primary purpose of the project or program undertaken 
by the agency;
    (4) There is no Federal law, other than the Uniform Act, which 
clearly establishes a requirement for the payment of utility moving 
costs that is applicable to the agency's program or project; and
    (5) State or local government reimbursement for utility moving 
costs or payment of such costs by the agency is in accordance with 
State law.
    (b) For the purposes of this section, the term extraordinary 
expenses mean those expenses which, in the opinion of the agency, are 
not routine or predictable expenses relating to the utility's occupancy 
of rights-of-way, and are not ordinarily budgeted as operating 
expenses, unless the owner of the utility facility has explicitly and 
knowingly agreed to bear such expenses as a condition for use of the 
property or has voluntarily agreed to be responsible for such expenses.
    (c) A relocation payment to a utility facility owner for moving 
costs under this section may not exceed the cost to functionally 
restore the service disrupted by the federally assisted program or 
project, less any increase in value of the new facility and salvage 
value of the old facility. The agency and the utility facility owner 
shall reach prior agreement on the nature of the utility relocation 
work to be accomplished, the eligibility of the work for reimbursement, 
the responsibilities for financing and accomplishing the work, and the 
method of accumulating costs and making payment. (See appendix A to 
this part, section 24.306.)

Subpart E--Replacement Housing Payments


Sec.  24.401  Replacement housing payment for 90-day homeowner-
occupants.

    (a) Eligibility. A displaced person is eligible for the replacement 
housing payment for a 90-day homeowner-occupant if the person:
    (1) Has actually owned and occupied the displacement dwelling for 
not less than 90 days immediately prior to the initiation of 
negotiations; and
    (2) Purchases and occupies a decent, safe, and sanitary replacement 
dwelling within 1 year after the later of the following dates (except 
that the agency may extend such 1 year period for good cause):
    (i) The date the displaced person receives final payment for the 
displacement dwelling or, in the case of condemnation, the date the 
full amount of the estimate of just compensation is deposited in the 
court; or
    (ii) The date the agency's obligation under Sec.  24.204 is met.
    (b) Amount of payment. The replacement housing payment for an 
eligible 90-day homeowner-occupant may not exceed $41,200 (see also 
Sec.  24.404). The payment under this subpart is limited to the amount 
necessary to relocate to a comparable replacement dwelling within 1 
year from the date the displaced homeowner-occupant is paid for the 
displacement dwelling, or the date a comparable replacement dwelling is 
made available to such person, whichever is later. The payment shall be 
the sum of:
    (1) The amount by which the cost of a replacement dwelling exceeds 
the acquisition cost of the displacement dwelling, as determined in 
accordance with paragraph (c) of this section;
    (2) The increased interest costs and other debt service costs which 
are incurred in connection with the mortgage(s) on the replacement 
dwelling, as determined in accordance with paragraph (d) or (e) of this 
section, as applicable; and
    (3) The reasonable expenses incidental to the purchase of the 
replacement dwelling, as determined in accordance with paragraph (f) of 
this section.
    (c) Price differential--(1) Basic computation. The price 
differential to be paid under paragraph (b)(1) of this section is the 
amount which must be added to the acquisition cost of the displacement 
dwelling and site (see Sec.  24.2(a)) to provide a total amount equal 
to the lesser of:
    (i) The reasonable cost of a comparable replacement dwelling as 
determined in accordance with Sec.  24.403(a); or
    (ii) The purchase price of the DSS replacement dwelling actually 
purchased and occupied by the displaced person.
    (2) Owner retention of displacement dwelling. If the owner retains 
ownership of his or her dwelling, moves it from the displacement site, 
and reoccupies it on a replacement site, the purchase price of

[[Page 36964]]

the replacement dwelling shall be the sum of:
    (i) The cost of moving and restoring the dwelling to a condition 
comparable to that prior to the move;
    (ii) The cost of making the unit a DSS replacement dwelling (see 
Sec.  24.2(a));
    (iii) The current fair market value for residential use of the 
replacement dwelling site (see appendix A to this part, section 
24.401(c)(2)(iii)), unless the claimant rented the displacement site 
and there is a reasonable opportunity for the claimant to rent a 
suitable replacement site; and
    (iv) The retention value of the dwelling if such retention value is 
reflected in the ``acquisition cost'' used when computing the 
replacement housing payment.
    (d) Increased mortgage interest costs. The agency shall determine 
the factors to be used in computing the amount to be paid to a 
displaced person under paragraph (b)(2) of this section. Except as 
otherwise provided in paragraph (e) of this section, the payment for 
increased mortgage interest cost shall be the amount which will reduce 
the mortgage balance on a new mortgage to an amount which could be 
amortized with the same monthly payment for principal and interest as 
that for the mortgage(s) on the displacement dwelling. In addition, 
payments shall include other debt service costs, if not paid as 
incidental costs, and shall be based only on bona fide mortgages that 
were valid liens on the displacement dwelling for at least 180 days 
prior to the initiation of negotiations. Paragraphs (d)(1) through (5) 
of this section shall apply to the computation of the increased 
mortgage interest costs payment, which payment shall be contingent upon 
a mortgage being placed on the replacement dwelling.
    (1) The payment shall be based on the unpaid mortgage balance(s) on 
the displacement dwelling; however, in the event the displaced person 
obtains a smaller mortgage than the mortgage balance(s) computed in the 
buydown determination, the payment will be prorated and reduced 
accordingly. (See appendix A to this part, section 24.401(d).) In the 
case of a home equity loan the unpaid balance shall be that balance 
which existed 180 days prior to the initiation of negotiations or the 
balance on the date of acquisition, whichever is less.
    (2) The payment shall be based on the remaining term of the 
mortgage(s) on the displacement dwelling or the term of the new 
mortgage, whichever is shorter.
    (3) The interest rate on the new mortgage used in determining the 
amount of the payment shall not exceed the prevailing fixed interest 
rate for conventional mortgages currently charged by mortgage lending 
institutions in the area in which the replacement dwelling is located.
    (4) Purchaser's points and loan origination or assumption fees, but 
not seller's points, shall be paid to the extent:
    (i) They are not paid as incidental expenses;
    (ii) They do not exceed rates normal to similar real estate 
transactions in the area;
    (iii) The agency determines them to be necessary; and
    (iv) The computation of such points and fees shall be based on the 
unpaid mortgage balance on the displacement dwelling, less the amount 
determined for the reduction of the mortgage balance under this 
section.
    (5) The displaced person shall be advised of the approximate amount 
of this payment and the conditions that must be met to receive the 
payment as soon as the facts relative to the person's current 
mortgage(s) are known and the payment shall be made available at or 
near the time of closing on the replacement dwelling in order to reduce 
the new mortgage as intended.
    (e) Reverse mortgages. The payment for replacing a reverse mortgage 
shall be the difference between the existing reverse mortgage balance 
and the minimum dollar amount necessary to purchase a replacement 
reverse mortgage which will provide the same or similar terms as that 
for the reverse mortgage on the displacement dwelling. In addition, 
payments shall include other debt service costs, if not paid as 
incidental costs, and shall be based only on reverse mortgages that 
were valid liens on the displacement dwelling for at least 180 days 
prior to the initiation of negotiations. Paragraphs (e)(1) through (4) 
of this section shall apply to the computation of the mortgage interest 
differential payment required under paragraph (d) of this section, 
which payment shall be contingent upon a new reverse mortgage being 
purchased for the replacement dwelling.
    (1) The payment shall be based on the difference between the 
reverse mortgage balance and the minimum amount needed to qualify for a 
reverse mortgage with the similar terms as the reverse mortgage on the 
displacement dwelling; however, in the event the displaced person 
obtains a reverse mortgage with a smaller principal balance than the 
reverse mortgage balance(s) computed in the buydown determination, the 
payment will be prorated and reduced accordingly. (See appendix A to 
this part, section 24.401(e).) The reverse mortgage balance shall be 
that balance which existed 180 days prior to the initiation of 
negotiations or the reverse mortgage balance on the date of 
acquisition, whichever is less.
    (2) The interest rate on the new reverse mortgage used in 
determining the amount of the eligibility shall not exceed the 
prevailing rate for reverse mortgages currently charged by mortgage 
lending institutions for owners with similar amounts of equity in their 
units in the area in which the replacement dwelling is located.
    (3) Purchaser's points and loan origination, but not seller's 
points, shall be paid to the extent:
    (i) They are not paid as incidental expenses;
    (ii) They do not exceed rates normal to similar real estate 
transactions in the area;
    (iii) The agency determines them to be necessary; and
    (iv) The computation of such points and fees shall be based on the 
reverse mortgage balance on the displacement dwelling plus any amount 
necessary to purchase the new reverse mortgage.
    (4) The displaced person or their representative shall be advised 
of the approximate amount of this eligibility and the conditions that 
must be met to receive the reimbursement as soon as the facts relative 
to the person's current reverse mortgage are known; the payment shall 
be made available at or near the time of closing on the replacement 
dwelling in order to purchase the new reverse mortgage as intended.
    (f) Incidental expenses. The incidental expenses to be paid under 
paragraph (b)(3) of this section or Sec.  24.402(c)(1) are those 
necessary and reasonable costs actually incurred by the displaced 
person incident to the purchase of a replacement dwelling, and 
customarily paid by the buyer, including:
    (1) Legal, closing, and related costs, including those for title 
search, preparing conveyance instruments, notary fees, preparing 
surveys and plats, and recording fees.
    (2) Lender, FHA, or VA application and appraisal fees.
    (3) Loan origination or assumption fees that do not represent 
prepaid interest.
    (4) Professional home inspection, certification of structural 
soundness, and termite inspection.
    (5) Credit report.
    (6) Owner's and mortgagee's evidence of title, e.g., title 
insurance, not to exceed the costs for a comparable replacement 
dwelling.
    (7) Escrow agent's fee.
    (8) State revenue or documentary stamps, sales, or transfer taxes 
(not to

[[Page 36965]]

exceed the costs for a comparable replacement dwelling).
    (9) Such other costs as the agency determines to be incidental to 
the purchase.
    (g) Rental assistance payment for 90-day homeowner. A 90-day 
homeowner-occupant, who could be eligible for a replacement housing 
payment under paragraph (a) of this section but elects to rent a 
replacement dwelling, is eligible for a rental assistance payment. The 
amount of the rental assistance payment is based on a determination of 
market rent for the acquired dwelling compared to a comparable rental 
dwelling available on the market. The difference, if any, is computed 
in accordance with Sec.  24.402(b)(1), except that the limit of $9,570 
does not apply, and is disbursed in accordance with Sec.  24.402(b)(3). 
Under no circumstances would the rental assistance payment exceed the 
amount that could have been received under paragraph (b)(1) of this 
section had the 90-day homeowner elected to purchase and occupy a 
comparable replacement dwelling. Payments allowed under Sec.  24.402(c) 
are not applicable.


Sec.  24.402  Replacement housing payment for 90-day tenants and 
certain others.

    (a) Eligibility. A tenant or homeowner displaced from a dwelling is 
entitled to a payment not to exceed $9,570 for rental assistance, as 
computed in accordance with paragraph (b) of this section, or down 
payment assistance, as computed in accordance with paragraph (c) of 
this section, if such displaced person:
    (1) Has actually and lawfully occupied the displacement dwelling 
for at least 90 days immediately prior to the initiation of 
negotiations; and
    (2) Has rented or purchased and occupied a DSS replacement dwelling 
within 1 year (unless the agency extends this period for good cause) 
after the date he or she moves from the displacement dwelling.
    (b) Rental assistance payment--(1) Amount of payment. An eligible 
displaced person under paragraph (a) of this section who rents a 
replacement dwelling is entitled to a payment not to exceed $9,570 for 
rental assistance. (See Sec.  24.404) Such payment shall be 42 times 
the amount obtained by subtracting the base monthly rental for the 
displacement dwelling from the lesser of:
    (i) The monthly rent and estimated average monthly cost of 
utilities for a comparable replacement dwelling; or
    (ii) The monthly rent and estimated average monthly cost of 
utilities for the DSS replacement dwelling actually occupied by the 
displaced person.
    (2) Base monthly rental for displacement dwelling. The base monthly 
rental for the displacement dwelling is the lesser of:
    (i) The average monthly cost for rent and utilities at the 
displacement dwelling for a reasonable period prior to displacement, as 
determined by the agency (for an owner-occupant, use the fair market 
rent for the displacement dwelling; for a tenant who paid little or no 
rent for the displacement dwelling, use the fair market rent, unless 
its use would result in a hardship because of the person's income or 
other circumstances);
    (ii) Thirty (30) percent of the displaced person's average monthly 
gross household income if the amount is classified as ``low income'' by 
the U.S. Department of Housing and Urban Development (HUD) in its most 
recently published Uniform Relocation Act Income Limits (``Survey''). 
The base monthly rental shall be established solely on the criteria in 
paragraph (b)(2)(i) of this section for persons with income exceeding 
the Survey's ``low income'' limits, for persons refusing to provide 
appropriate evidence of income, and for persons who are dependents. A 
full-time student or resident of an institution may be assumed to be a 
dependent, unless the person demonstrates otherwise; or
    (iii) The total of the amounts designated for shelter and utilities 
if the displaced person is receiving a welfare assistance payment from 
a program that designates the amounts for shelter and utilities.
    Note 1 to paragraph (b)(2): The Survey's income limits are updated 
annually and are available on FHWA's website at https://www.fhwa.dot.gov/real_estate/low_income_calculations/index.cfm.
    (3) Manner of disbursement. A rental assistance payment may, at the 
agency's discretion, be disbursed in either a lump sum or in 
installments. However, except as limited by Sec.  24.403(f), the full 
amount vests immediately, whether or not there is any later change in 
the person's income or rent, or in the condition or location of the 
person's replacement housing.
    (c) Down payment assistance payment--(1) Amount of payment. An 
eligible displaced person under paragraph (a) of this section who 
purchases a replacement dwelling is entitled to a down payment 
assistance payment in the amount the person would receive under 
paragraph (b) of this section if the person rented a comparable 
replacement dwelling. At the agency's discretion, a down payment 
assistance payment that is less than $9,570 may be increased to any 
amount not to exceed $9,570. However, the payment to a displaced person 
shall not exceed the amount the homeowner would receive under Sec.  
24.401(b) if he or she met the 90-day occupancy requirement. If the 
agency elects to provide the maximum payment of $9,570 as a down 
payment, the agency shall apply this discretion in a uniform and 
consistent manner, so that eligible displaced persons in like 
circumstances are treated equally. A displaced person eligible to 
receive a payment as a 90-day owner-occupant under Sec.  24.401(a) is 
not eligible for this payment. (See appendix A to this part, section 
24.402(c) for payments to less than 90-day occupants and for a 
discussion of those who fail to meet the 90-day occupancy 
requirements.)
    (2) Application of payment. The full amount of the replacement 
housing payment for down payment assistance must be applied to the 
purchase price of the replacement dwelling and related incidental 
expenses.


Sec.  24.403  Additional rules governing replacement housing payments.

    (a) Determining cost of comparable replacement dwelling. The upper 
limit of a replacement housing payment shall be based on the cost of a 
comparable replacement dwelling. (See Sec.  24.2(a).)
    (1) If available, at least three comparable replacement dwellings 
shall be considered and the payment computed on the basis of the 
dwelling most nearly representative of, and equal to or better than, 
the displacement dwelling. (See appendix A to this part, section 
24.403(a)(1).)
    (2) If the site of the comparable replacement dwelling lacks a 
major exterior attribute of the displacement dwelling site, (e.g., the 
site is significantly smaller or does not contain a swimming pool), the 
contributory value of such attribute as determined by the agency shall 
be subtracted from the acquisition cost of the displacement dwelling 
for purposes of computing the payment. (See appendix A to this part, 
section 24.403(a)(2).)
    (3) If the acquisition of a portion of a typical residential 
property causes the displacement of the owner from the dwelling and the 
agency determines that the remainder has economic value to the owner, 
the agency may offer to purchase the entire property. If the owner 
refuses to sell the remainder to the agency, the fair market value of 
the remainder may be added to the acquisition cost of the displacement 
dwelling for purposes of computing the replacement housing

[[Page 36966]]

payment. (See appendix A to this part, section 24.403(a)(3).)
    (4) To the extent feasible, comparable replacement dwellings shall 
be selected from the neighborhood in which the displacement dwelling 
was located or, if that is not possible, in nearby or similar 
neighborhoods where housing costs are generally the same or higher.
    (5) When there are multiple occupants of one displacement dwelling 
and if two or more occupants of the displacement dwelling move to 
separate replacement dwellings, each occupant is entitled to a 
reasonable prorated share, as determined by the agency, of any 
relocation payments that would have been made if the occupants moved 
together to a comparable replacement dwelling. However, if the agency 
determines that two or more occupants maintained separate households 
within the same dwelling, such occupants have separate entitlements to 
relocation payments.
    (6) An agency shall deduct the amount of any advance relocation 
payment from the relocation payment(s) to which a displaced person is 
otherwise entitled. The agency shall not withhold any part of a 
relocation payment to a displaced person to satisfy an obligation to 
any other creditor.
    (7) For mixed-use and multifamily properties, if the displacement 
dwelling was part of a property that contained another dwelling unit 
and/or space used for nonresidential purposes, and/or is located on a 
lot larger than typical for residential purposes, only that portion of 
the acquisition payment which is actually attributable to the 
displacement dwelling shall be considered the acquisition cost when 
computing the replacement housing payment.
    (b) Inspection of replacement dwelling. Before making a replacement 
housing payment or releasing the initial payment from escrow, the 
agency or its designated representative shall inspect the replacement 
dwelling and determine whether it is a DSS dwelling as defined at Sec.  
24.2(a).
    (c) Purchase of replacement dwelling. A displaced person is 
considered to have met the requirement to purchase a replacement 
dwelling, if the person:
    (1) Purchases a dwelling;
    (2) Purchases and rehabilitates a substandard dwelling;
    (3) Relocates a dwelling which he or she owns or purchases;
    (4) Constructs a dwelling on a site he or she owns or purchases;
    (5) Contracts for the purchase or construction of a dwelling on a 
site provided by a builder or on a site the person owns or purchases; 
or
    (6) Currently owns a previously purchased dwelling and site, 
valuation of which shall be on the basis of current fair market value.
    (d) Occupancy requirements for displacement or replacement 
dwelling. No person shall be denied eligibility for a replacement 
housing payment solely because the person is unable to meet the 
occupancy requirements set forth in this part for a reason beyond his 
or her control, including:
    (1) A disaster, an emergency, or an imminent threat to the public 
health or welfare, as determined by the President, the Federal agency 
funding the project, or the agency; or
    (2) Another reason, such as a delay in the construction of the 
replacement dwelling, military duty, or hospital stay, as determined by 
the agency.
    (e) Conversion of payment. A displaced person who initially rents a 
replacement dwelling and receives a rental assistance payment under 
Sec.  24.402(b) is eligible to receive a payment under Sec.  24.401 or 
Sec.  24.402(c) if he or she meets the eligibility criteria for such 
payments, including purchase and occupancy within the prescribed 1-year 
period. Any portion of the rental assistance payment that has been 
disbursed shall be deducted from the payment computed under Sec.  
24.401 or Sec.  24.402(c).
    (f) Payment after death. A replacement housing payment is personal 
to the displaced person and upon his or her death the undisbursed 
portion of any such payment shall not be paid to the heirs or assigns, 
except that:
    (1) The amount attributable to the displaced person's period of 
actual occupancy of the replacement housing shall be paid.
    (2) Any remaining payment shall be disbursed to the remaining 
family members of the displaced household in any case in which a member 
of a displaced family dies.
    (3) Any portion of a replacement housing payment necessary to 
satisfy the legal obligation of an estate in connection with the 
selection of a replacement dwelling by or on behalf of a deceased 
person shall be disbursed to the estate.
    (g) Insurance proceeds. To the extent necessary to avoid duplicate 
compensation, the amount of any insurance proceeds received by a person 
in connection with a loss to the displacement dwelling due to a 
catastrophic occurrence (fire, flood, etc.) shall be included in the 
acquisition cost of the displacement dwelling when computing the price 
differential. (See Sec.  24.3.)


Sec.  24.404  Replacement housing of last resort.

    (a) Determination to provide replacement housing of last resort. 
Whenever a program or project cannot proceed on a timely basis because 
comparable replacement dwellings are not available within the monetary 
limits for owners or tenants, as specified in Sec.  24.401 or Sec.  
24.402, as appropriate, the agency shall provide additional or 
alternative assistance under the provisions of this subpart. Any 
decision to provide last resort housing assistance must be adequately 
justified either:
    (1) On a case-by-case basis, for good cause, which means that 
appropriate consideration has been given to:
    (i) The availability of comparable replacement housing in the 
program or project area;
    (ii) The resources available to provide comparable replacement 
housing; and
    (iii) The individual circumstances of the displaced person; or
    (2) By a determination that:
    (i) There is little, if any, comparable replacement housing 
available to displaced persons within an entire program or project 
area; and, therefore, last resort housing assistance is necessary for 
the area as a whole;
    (ii) A program or project cannot be advanced to completion in a 
timely manner without last resort housing assistance; and
    (iii) The method selected for providing last resort housing 
assistance is cost effective, considering all elements, which 
contribute to total program or project costs.
    (b) Basic rights of persons to be displaced. Notwithstanding any 
provision of this subpart, no person shall be required to move from a 
displacement dwelling unless comparable replacement housing is 
available to such person. No person may be deprived of any rights the 
person may have under the Uniform Act or this part. The agency shall 
not require any displaced person to accept a dwelling provided by the 
agency under the procedures in this part (unless the agency and the 
displaced person have entered into a contract to do so) in lieu of any 
acquisition payment or any relocation payment for which the person may 
otherwise be eligible.
    (c) Methods of providing comparable replacement housing. Agencies 
shall have broad latitude in implementing this subpart, but 
implementation shall be for reasonable cost, on a case-by-case basis 
unless an exception to case-by-case analysis is justified for an entire 
project.

[[Page 36967]]

    (1) The methods of providing replacement housing of last resort 
include, but are not limited to:
    (i) A replacement housing payment in excess of the limits set forth 
in Sec.  24.401 or Sec.  24.402. A replacement housing payment under 
this section may be provided in installments or in a lump sum at the 
agency's discretion.
    (ii) Rehabilitation of and/or additions to an existing replacement 
dwelling.
    (iii) The construction of a new replacement dwelling.
    (iv) The provision of a direct loan, which requires regular 
amortization or deferred repayment. The loan may be unsecured or 
secured by the real property. The loan may bear interest or be 
interest-free.
    (v) The relocation and, if necessary, rehabilitation of a dwelling.
    (vi) The purchase of land and/or a replacement dwelling by the 
agency and subsequent sale or lease to, or exchange with a displaced 
person.
    (vii) The removal of barriers for persons with disabilities.
    (2) Under special circumstances, consistent with the definition of 
a comparable replacement dwelling in Sec.  24.2(a), modified methods of 
providing replacement housing of last resort permit consideration of 
replacement housing based on space and physical characteristics 
different from those in the displacement dwelling (see appendix A to 
this part, section 24.404(c)), including upgraded, but smaller 
replacement housing that is DSS and adequate to accommodate individuals 
or families displaced from marginal or substandard housing with 
probable functional obsolescence. In no event, however, shall a 
displaced person be required to move into a dwelling that is not 
functionally equivalent in accordance with Sec.  24.2(a), comparable 
replacement housing.
    (3) The agency shall provide assistance under this subpart to a 
displaced person who is not eligible to receive a replacement housing 
payment under Sec. Sec.  24.401 and 24.402 because of failure to meet 
the length of occupancy requirement when comparable replacement rental 
housing is not available at rental rates within the displaced person's 
financial means. (See Sec.  24.2(a).) Such assistance shall cover a 
period of 42 months.

Subpart F--Mobile Homes


Sec.  24.501  Applicability.

    (a) General. This subpart describes the requirements governing the 
provision of replacement housing payments to a person displaced from a 
mobile home and/or mobile home site who meets the basic eligibility 
requirements of this part. Except as modified by this subpart, such a 
displaced person is entitled to:
    (1) A moving expense payment in accordance with subpart D of this 
part; and
    (2) A replacement housing payment in accordance with subpart E of 
this part to the same extent and subject to the same requirements as 
persons displaced from conventional dwellings. Moving cost payments to 
persons occupying mobile homes are covered in Sec.  24.301(g)(1) 
through (11).
    (b) Partial acquisition of mobile home park. The acquisition of a 
portion of a mobile home park property may leave a remaining part of 
the property that is not adequate to continue the operation of the 
park. If the agency determines that a mobile home located in the 
remaining part of the property must be moved as a direct result of the 
project, the occupant of the mobile home shall be considered to be a 
displaced person who is entitled to relocation payments and other 
assistance under this part.


Sec.  24.502  Replacement housing payment for a 90-day mobile homeowner 
displaced from a mobile home and/or from the acquired mobile home site.

    (a) Eligibility. An owner-occupant displaced from a mobile home is 
entitled to a replacement housing payment, not to exceed $41,200, under 
Sec.  24.401 if:
    (1) The person occupied the mobile home on the displacement site 
for at least 90 days immediately before:
    (i) The initiation of negotiations to acquire the mobile home, if 
the person owned the mobile home and the mobile home is real property;
    (ii) The initiation of negotiations to acquire the mobile home site 
if the mobile home is personal property, but the person owns the mobile 
home site; or
    (iii) The date of the agency's written notification to the owner-
occupant that the owner is determined to be displaced from the mobile 
home as described in paragraphs (a)(3)(i) through (iv) of this section;
    (2) The person meets the other basic eligibility requirements at 
Sec.  24.401(a)(2); and
    (3) The agency acquires the mobile home as real estate, or acquires 
the mobile home site from the displaced owner, or the mobile home is 
personal property, but the owner is displaced from the mobile home 
because the agency determines that the mobile home:
    (i) Is not, and cannot economically be made decent, safe, and 
sanitary;
    (ii) Cannot be relocated without substantial damage or unreasonable 
cost;
    (iii) Cannot be relocated because there is no available comparable 
replacement site; or
    (iv) Cannot be relocated because it does not meet mobile home park 
entrance requirements.
    (b) Replacement housing payment computation for a 90-day owner that 
is displaced from a mobile home. The replacement housing payment for an 
eligible displaced 90-day owner is computed as described at Sec.  
24.401(b) incorporating the following, as applicable:
    (1) If the agency acquires the mobile home as real estate and/or 
acquires the owned site, the acquisition cost used to compute the price 
differential payment is the actual amount paid to the owner as just 
compensation for the acquisition of the mobile home, and/or site, if 
owned by the displaced mobile homeowner.
    (2) If the agency does not purchase the mobile home as real estate 
but the owner is determined to be displaced from the mobile home and 
eligible for a replacement housing payment based on paragraph 
(a)(1)(iii) of this section, the eligible price differential payment 
for the purchase of a comparable replacement mobile home, is the lesser 
of the displaced mobile homeowner occupant's net cost to purchase a 
replacement mobile home (i.e., purchase price of the replacement mobile 
home less trade-in or sale proceeds of the displacement mobile home); 
or, the cost of the agency's selected comparable mobile home less the 
agency's estimate of the salvage or trade-in value for the mobile home 
from which the person is displaced.
    (3) If a comparable replacement mobile home site is not available, 
the price differential payment shall be computed on the basis of the 
reasonable cost of a conventional comparable replacement dwelling.
    (c) Replacement housing payment for a 90-day owner-occupant that is 
displaced from a leased or rented mobile home site. If the displacement 
mobile homeowner-occupant's site is leased or rented, a 90-day owner-
occupant is entitled to a rental assistance payment computed as 
described in Sec.  24.402(b). This rental assistance replacement 
housing payment may be used to lease a replacement site, may be applied 
to the purchase price of a replacement site, or may be applied, with 
any replacement housing payment attributable to the mobile home, toward 
the purchase of a replacement mobile home and the

[[Page 36968]]

purchase or lease of a site or the purchase of a conventional decent, 
safe, and sanitary dwelling.
    (d) Owner-occupant not displaced from the mobile home. If the 
agency determines that a mobile home is personal property and may be 
relocated to a comparable replacement site, but the owner-occupant 
elects not to do so, the owner is not entitled to a replacement housing 
payment for the purchase of a replacement mobile home. However, the 
owner is eligible for moving costs described at Sec.  24.301 and any 
replacement housing payment for the purchase or rental of a comparable 
site as described in this section as applicable.


Sec.  24.503  Replacement housing payment for 90-day mobile home 
occupants.

    A displaced tenant or owner-occupant of a mobile home and/or site 
is eligible for a replacement housing payment, not to exceed $9,570, 
under Sec.  24.402 if:
    (a) The person actually occupied the displacement mobile home on 
the displacement site for at least 90 days immediately prior to the 
initiation of negotiations;
    (b) The person meets the other basic eligibility requirements at 
Sec.  24.402(a); and
    (c) The agency acquires the mobile home and/or mobile home site, or 
the mobile home is not acquired by the agency, but the agency 
determines that the occupant is displaced from the mobile home because 
of one of the circumstances described at Sec.  24.502(a)(3).

Subpart G--Certification


Sec.  24.601  Purpose.

    This subpart permits a State agency to fulfill its responsibilities 
under the Uniform Act by certifying that it shall operate in accordance 
with State laws and regulations which shall accomplish the purpose and 
effect of the Uniform Act, in lieu of providing the assurances required 
by Sec.  24.4.


Sec.  24.602  Certification application.

    An agency wishing to proceed on the basis of a certification may 
request an application for certification from the Lead Agency Director, 
Office of Real Estate Services, HEPR-1, Federal Highway Administration, 
1200 New Jersey Avenue SE, Washington, DC 20590. The completed 
application for certification must be approved by the governor of the 
State, or the governor's designee, and must be coordinated with the 
Federal funding agency, in accordance with application procedures.


Sec.  24.603  Monitoring and corrective action.

    (a) The Federal Lead Agency shall, in coordination with other 
Federal agencies, monitor from time to time State agency implementation 
of programs or projects conducted under the certification process and 
the State agency shall make available any information required for this 
purpose.
    (b) The Lead Agency may require periodic information or data from 
affected Federal or State agencies.
    (c) A Federal agency may, after consultation with the Lead Agency, 
and notice to and consultation with the governor, or his or her 
designee, rescind any previous approval provided under this subpart if 
the certifying State agency fails to comply with its certification or 
with applicable State law and regulations. The Federal agency shall 
initiate consultation with the Lead Agency at least 30 days prior to 
any decision to rescind approval of a certification under this subpart. 
The Lead Agency will also inform other Federal agencies, which have 
accepted a certification under this subpart from the same State agency 
and will take whatever other action that may be appropriate.
    (d) Section 103(b)(2) of the Uniform Act, as amended, requires that 
the head of the Lead Agency report biennially to the Congress on State 
agency implementation of section 103. To enable adequate preparation of 
the prescribed biennial report, the Lead Agency may require periodic 
information or data from affected Federal or State agencies.

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 acronyms.
    Section 24.2(a) Comparable replacement dwelling, (ii). The 
requirement 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. 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 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) 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 housing program before displacement, 
must be currently available on the private market without any 
subsidy under a Government housing program.
    Section 24.2(a) Comparable replacement dwelling, (ix). If a 
person accepts assistance under a Government housing assistance 
program, the rules of that program governing the size of the 
dwelling apply, and the rental assistance payment under Sec.  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) Decent, safe, and sanitary, (i)(A). 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, it is strongly recommended that 
they be considered as a matter of public policy.
    Section 24.2(a) 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 is required to address 
comparability for persons with a physical impairment that 
substantially

[[Page 36969]]

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 
shall also consider other items that may be necessary, such as 
physical modification to a unit, based on the displaced person's 
needs. 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) Household income (exclusions). Household income 
for purposes of this part does not include program benefits that are 
not considered income by Federal law such as food stamps and the 
Women Infants and Children program. For a more detailed list of 
income exclusions see FHWA, Office of Real Estate Services 
website.\1\ Contact the Federal agency administering the program if 
there is a question on whether to include income from a specific 
program.
---------------------------------------------------------------------------

    \1\ http://www.fhwa.dot.gov/realestate/.
---------------------------------------------------------------------------

    Section 24.2(a) Initiation of negotiations. This section 
provides a special definition for acquisition and displacements 
under 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, 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) Initiation of negotiations, Tenants, (iv). 
Tenants who occupy property that may be voluntarily acquired, 
without recourse to the use of the power of eminent domain, must be 
fully informed as to their potential eligibility for relocation 
assistance when negotiations are initiated. 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 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) 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 that can be found acceptable as 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 has available all necessary 
utilities for functioning as a housing unit on the date of the 
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 DSS dwellings. In 
those cases, the recreational vehicle will not qualify as a 
replacement dwelling.)
    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,

[[Page 36970]]

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 Sec.  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 Sec.  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 (Sec.  
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 x 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, are 
synonymous.
    Section 24.101(a) Direct Federal program or project. All the 
requirements in subpart B of this part (real property acquisition) 
apply to all direct acquisitions for Federal programs and projects 
by Federal agencies, except for acquisitions undertaken by the 
Tennessee Valley Authority or the Rural Utilities Service.
    Section 24.101(b)(1)(i)(B). This section provides that, for 
programs and projects receiving Federal financial assistance 
described in Sec.  24.101(b)(1), agencies are to inform the owner(s) 
or their designated representative(s) in writing of the 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 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, persons developing a waiver valuation 
must have sufficient knowledge of the local market (Sec.  
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 determinations. It would be appropriate for 
agencies to adhere to project influence restrictions, as well as 
guard against discredited ``public interest value'' valuation 
concepts.
    After an 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 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 this part, it would be entirely appropriate for 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 Sec.  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 Sec.  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

[[Page 36971]]

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 Sec.  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. 
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 a technique to avoid the costs and time delay 
associated with appraisal requirements for 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 complex work.
    The agency representative making the determination to use the 
waiver valuation option must have enough understanding of appraisal 
principles, techniques, and use of appraisals to be able to 
determine whether the proposed acquisition is uncomplicated and 
within the low fair market value limits in this part.
    Waiver valuations are not appraisals as defined by the Uniform 
Act and this part; therefore, appraisal performance requirements or 
standards, regardless of their source, are not required for waiver 
valuations by this part. Since waiver valuations are not appraisals, 
neither is there a requirement for an appraisal review. 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 official must still establish an amount believed to be just 
compensation to offer the property owner(s) (see Sec.  24.102(d)).
    The definition of ``appraisal'' in the Uniform Act and waiver 
valuation provisions of the Uniform Act and 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 agency's approved appraisal or waiver valuation of the 
fair market value of the property but may exceed that amount if the 
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 requires that the property owner be given a 
reasonable opportunity to consider the agency's offer and to present 
relevant material to the agency. In order to satisfy the requirement 
in Sec.  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 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. The provisions 
of Sec.  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 in Sec.  24.102(f), and the 
agencies adhere to the Uniform Act ban on coercive action Section 
4651(7) of the Uniform Act and Sec.  24.102(h)).
    If the owner expresses intent to provide an appraisal report, 
agencies are encouraged to provide the owner and/or their appraiser 
a copy of 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 official delegated this authority. Appraisers, including 
review appraisers, shall not be unduly influenced or coerced to 
adjust an estimate of value for the purpose of justifying such 
settlements (see Sec.  24.102(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 4651(6) of the Uniform 
Act limits what an agency may charge when a former owner or previous 
occupant of a property is permitted to rent the property for a short 
term or when occupancy is subject to termination by the agency on 
short notice. Such rent may not exceed ``the fair rental value of 
the property to a short-term occupier.'' Generally, the agency's 
right to terminate occupancy on short notice (whether or not the 
renter also has that right) supports the establishment of a lesser 
rental than might be found in a longer, fixed-term situation.
    Section 24.102(n) Conflict of interest. The overall objective is 
to minimize the risk of

[[Page 36972]]

fraud, waste, and abuse while allowing agencies to operate as 
efficiently as possible. There are three parts to the provision in 
Sec.  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 valuation), 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 or recipients from providing 
appraiser and/or waiver valuers with appropriate project information 
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 may waive this 
requirement if it would create a hardship for the agency 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) 
provides that the same person may perform a waiver valuation or 
appraisal and negotiate that acquisition, if the waiver valuation or 
appraisal estimate amount is $15,000 or less. Agencies or recipients 
are not required to use those who perform a waiver valuation or 
appraisal of $15,000 or less to negotiate the acquisition. All 
appraisals must be reviewed in accordance with Sec.  24.104. This 
includes appraisals of real property valued at $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 Sec.  24.2(a) 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 this part. 
These are the basic appraisal requirements for Federal and federally 
assisted programs or projects. However, agencies may enhance and 
expand on them, and there may be specific project or program 
legislation that references other appraisal requirements.
    The appraisal requirements in Sec.  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 4 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 part. 
Compliance with any other appraisal requirements is not within the 
purview of this part. An appraiser who is committed to working 
within the bounds of USPAP should recognize that compliance with 
both USPAP and the requirements in this part may be achieved by 
using the 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 and the requirements 
of Federal and federally assisted program appraisal practice. It 
should be developed cooperatively by the assigned appraiser and an 
agency official who is competent to both represent the agency'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, 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 Sec.  
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 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 have long held the perspective that appraisal review is a 
unique skill that, while it certainly builds on appraisal skills, 
requires additional skills. The review appraiser should possess both 
appraisal technical abilities and the ability to comprehend 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 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 policy and requirements, to 
appraisers, both staff and fee. In addition, review appraisers are 
frequently technical advisors to other agency officials.
    Section 24.104(a). 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 Sec.  
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

[[Page 36973]]

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 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 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 
believes is just compensation, she/he must be specifically 
authorized by the 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 official.
    Section 24.104(b). In 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 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 4651(3) purposes. It is within 
agency discretion to decide whether a second review is needed if the 
first review appraiser establishes a value different from that in 
the appraisal report or reports on the property.
    Section 24.104(c). Before acceptance of an appraisal, the review 
appraiser must 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 Sec.  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 Sec.  24.102(d).
    At the agency's discretion, for a low value property requiring 
only a simple appraisal solution, 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(a). Expenses incidental to transfer of title to 
the agency. Generally, the 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'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 must 
make a good faith effort to comply with Sec. Sec.  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. 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, Sec.  
24.204(a) requires that, where possible, three or more comparable 
replacement dwellings shall be made available. Thus, the basic 
standard for the number of referrals required under this section is 
three. Only in situations where three comparable replacement 
dwellings are not available (e.g., when the local housing market 
does not contain three comparable dwellings) may the agency make 
fewer than three referrals.
    Section 24.205 Relocation assistance advisory services.
    Section 24.205(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 Sec.  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 non-compliance (e.g., failure to move or relocate 
when instructed, or to cooperate in the relocation process) does not 
negate a person's entitlement to relocation payments and other 
assistance set forth in this part.
    Section 24.207 General Requirements--Claims for relocation 
payments. Section 24.207(a) allows an agency to make a payment for 
low cost or uncomplicated 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 Sec.  
24.301(d)(1).
    While Sec.  24.207(f) prohibits an agency from proposing or 
requesting that a person waive his or her rights or entitlements to 
relocation assistance and payments, an agency may accept a written 
statement from the person

[[Page 36974]]

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.
    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 Sec.  24.208(c) (alien not lawfully present 
excluded)
$1,300 (comparable)-$1,200 (displacement unit) = $100 RHP x 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 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 
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 therefore it 
becomes an actual loss of tangible personal property. Under Sec.  
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 part, the allowable in-place value estimate 
(Sec.  24.301(g)(15)(i)(B)) and moving cost estimate 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.
    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 (Sec.  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.

[[Page 36975]]

The information provided in this appendix is strictly informational.
---------------------------------------------------------------------------

    \2\ http://www.amea.org/.
    \3\ http://www.appraisers.org/Disciplines/Machinery-Technical-Specialties.
---------------------------------------------------------------------------

    Section 24.301(g)(18) Searching expenses. In special cases where 
the 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. Expenses negotiating the purchase of 
a replacement business site 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 $5,000, 
the agency may consider requesting a waiver of the cost limitation 
under the Sec.  24.7 waiver provision. Such a waiver should be 
subject to the approval of the Federal funding 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 Sec.  
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 Sec.  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) 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 should 
compare the rates of other similar professional providers in that 
area.
    Section 24.303(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 
Sec.  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 Sec.  24.304(b)(5) under the provisions of 
Sec.  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 Sec.  
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.
    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) x 12 = $20,000 annual net earnings x 2 
years = $40,000 divided by 2 = $20,000; Eligibility = $20,000. 
(Average annual net earnings.)


[[Page 36976]]


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

    Computation: $20,000 divided by 18 months = $1,111 per month x 
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. 
Section 24.306(c) describes the issues that the 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 23 CFR part 645, subpart A, should be 
followed.

Subpart E--Replacement Housing Payments

    Section 24.401 Replacement housing payment for 90-day homeowner-
occupants.
    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 
Sec.  24.401(c)(2)(iii) to use the current fair market value for 
residential use does not mean the agency must have the property 
appraised. Any reasonable method for arriving at the fair market 
value may be used.
    Section 24.401(d) Increased mortgage interest costs. The 
provision in Sec.  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 down 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 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               -42,010.18
     interest)..........................................
    Increased mortgage interest costs...................        7,989.82
    3 points on $42,010.18..............................        1,260.31
    Total buydown necessary to maintain payments at             9,250.13
     $458.22/month......................................
------------------------------------------------------------------------

    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 is obligated to inform the displaced person of the 
approximate amount of this payment and 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 Sec.  
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

[[Page 36977]]

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 Sec.  
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 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 Sec.  
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 Sec.  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 Sec.  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 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 Sec.  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 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 in which the displaced residence is located (found at: 
https://www.fhwa.dot.gov/real_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 Sec.  24.2(a)) 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 
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 five persons is: $35,000 + 12,000 + $18,000 
= $65,000

    The displacement residence is located in the State of Maryland, 
Caroline County. The low income limit for a five person household 
is: $77,950. (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 website at: 
https://www.fhwa.dot.gov/real_estate/.
    Section 24.402(c) Down payment assistance. The down payment 
assistance provisions in Sec.  24.402(c) limit such assistance to 
the amount of the computed rental assistance payment for a tenant. 
It does, however, provide the latitude for agency discretion in 
offering down payment assistance that exceeds the computed rental 
assistance payment, up to the $9,570 statutory maximum. This does 
not mean, however, that such agency discretion may be exercised in a 
selective or discriminatory fashion. The agency should develop a 
policy or requirement that affords equal treatment for displaced 
persons in like circumstances and this or requirement should be 
applied uniformly throughout the 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 
Sec. Sec.  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 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 Sec.  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 Sec.  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.

[[Page 36978]]

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

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

    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   ..............         165,000
 needed.................................
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. 
Section 24.404(b) affirms the right of a 90-day homeowner-occupant, 
who is eligible for a replacement housing payment under Sec.  
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 Sec.  24.2(a). The 
agency is not required to provide persons owning only a

[[Page 36979]]

fractional interest in the displacement dwelling a greater level of 
assistance to purchase a replacement dwelling than the agency would 
be required to provide such persons if they owned fee simple title 
to the displacement dwelling. If such assistance is not sufficient 
to buy a replacement dwelling, the agency may provide additional 
purchase assistance or rental assistance.
    Section 24.404(c) Methods of providing comparable replacement 
housing. 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.

Appendix B to Part 24--Statistical Report Form

    This appendix sets forth the statistical information collected 
from Federal agencies in accordance with Sec.  24.9(c).

General

    1. Report coverage. This report covers all relocation and real 
property acquisition activities under a Federal or a federally 
assisted project or program subject to the provisions of the Uniform 
Act. If the exact numbers are not easily available, an agency may 
provide what it believes to be a reasonable estimate.
    2. Report period. Activities shall be reported on a Federal 
fiscal year basis, i.e., October 1 through September 30.
    3. Where and when to submit report. Submit a copy of this report 
to the Lead Agency as soon as possible after September 30, but not 
later than November 15. Lead Agency address: Federal Highway 
Administration, Office of Real Estate Services (HEPR), 1200 New 
Jersey Avenue SE, Washington, DC 20590.
    4. How to report relocation payments. The full amount of a 
relocation payment shall be reported as if disbursed in the year 
during which the claim was approved, regardless of whether the 
payment is to be paid in installments.
    5. How to report dollar amounts. Round off all money entries in 
parts of this section A, B, and C to the nearest dollar.
    6. Regulatory references. The references in parts A, B, C, and D 
of this section indicate the subpart of this part pertaining to the 
requested information.

Part A. Real Property Acquisition Under the Uniform Act

    Line 1. Report all parcels acquired during the report year where 
title or possession was vested in the agency during the reporting 
period. The parcel count reported should relate to ownerships and 
not to the number of parcels of different property interests (such 
as fee, perpetual easement, temporary easement, etc.) that may have 
been part of an acquisition from one owner. For example, an 
acquisition from a property that includes a fee simple parcel, a 
perpetual easement parcel, and a temporary easement parcel should be 
reported as 1 parcel not 3 parcels. (Include parcels acquired 
without Federal financial assistance, if there was or will be 
Federal financial assistance in other phases of the project or 
program.)
    Line 2. Report the number of parcels reported on Line 1 that 
were acquired by condemnation. Include those parcels where 
compensation for the property was paid, deposited in court, or 
otherwise made available to a property owner pursuant to applicable 
law in order to vest title or possession in the agency through 
condemnation authority.
    Line 3. Report the number of parcels in Line 1 acquired through 
administrative settlement where the purchase price for the property 
exceeded the amount offered as just compensation and efforts to 
negotiate an agreement at that amount have failed.
    Line 4. Report the total of the amounts paid, deposited in 
court, or otherwise made available to a property owner pursuant to 
applicable law in order to vest title or possession in the agency in 
Line 1.

Part B. Residential Relocation Under the Uniform Act

    Line 5. Report the number of households who were permanently 
displaced during the fiscal year by project or program activities 
and moved to their replacement dwelling. The term ``households'' 
includes all families and individuals. A family is reported as 
``one'' household, not by the number of people in the family unit.
    Line 6. Report the total amount paid for residential moving 
expenses (actual expense and fixed payment).
    Line 7. Report the total amount paid for residential replacement 
housing payments including payments for replacement housing of last 
resort provided pursuant to Sec.  24.404.
    Line 8. Report the number of households in Line 5 who were 
permanently displaced during the fiscal year by project or program 
activities and moved to their replacement dwelling as part of last 
resort housing assistance.
    Line 9. Report the number of tenant households in Line 5 who 
were permanently displaced during the fiscal year by project or 
program activities, and who purchased and moved to their replacement 
dwelling using a down payment assistance payment under this part.
    Line 10. Report the total sum costs of residential relocation 
expenses and payments (excluding agency administrative expenses) in 
Lines 6 and 7.

Part C. Nonresidential Relocation Under the Uniform Act

    Line 11. Report the number of businesses, nonprofit 
organizations, and farms who were permanently displaced during the 
fiscal year by project or program activities and moved to their 
replacement location. This includes businesses, nonprofit 
organizations, and farms, that upon displacement, discontinued 
operations.
    Line 12. Report the total amount paid for nonresidential moving 
expenses (actual expense and fixed payment.)
    Line 13. Report the total amount paid for nonresidential 
reestablishment expenses.
    Line 14. Report the total sum costs of nonresidential relocation 
expenses and payments (excluding agency administrative expenses) in 
Lines 12 and 13.

Part D. Relocation Appeals

    Line 15. Report the total number of relocation appeals filed 
during the fiscal year by aggrieved persons (residential and 
nonresidential).
BILLING CODE 4910-22-P

[[Page 36980]]

[GRAPHIC] [TIFF OMITTED] TR03MY24.000

[FR Doc. 2024-08736 Filed 5-2-24; 8:45 am]
BILLING CODE 4910-22-C