Acquiring agencies make an effort to be extremely fair with the property owner and, if there is a doubt, to resolve it in his favor. The acquiring agency normally will not go beyond the reasonable fair market value. Occasionally there are cases where there is an honest difference of opinion as to value, and in these instances, it is desirable to let a court decide the question.
It is recognized that sometimes there are hardships resulting from taking property for which no just compensation can be made. As a case in point, an elderly couple had owned their home for many years. The wife had been blind for a number of those years, but because she knew the community, she could visit her friends, the stores, and other facilities within a several-block radius unaccompanied. The family agreed that the offer made for this home was, in fact, generous, but moving the blind woman to a new neighborhood was of genuine concern. Though the couple had to move, here was a hardship for which just compensation could not be legally paid.
In many cases, however, the situation of a family that has to be relocated ends up for the better because of strict regulations requiring health and safety features. In a southern State, a man, his wife and 11 children, ranging in age from 6 months to 16 years, lived in a three-room structure that the husband had built. There were no plumbing facilities, and a fireplace provided the only heat. The husband was disabled and unemployed. The family subsisted largely on a $1,980 yearly allowance for aid to dependent children.
The highway agency successfully relocated the family to another house superior to their former dwelling. The relocation officer was also instrumental in obtaining such necessities for the family as a stove, refrigerator, beds, bedding, furniture, and even clothing. In this case, the relocation officer provided much more than the strictly legal role required in the relocation process, which is discussed later in this chapter.
As a result of the requirement for sound, supported appraisals, appraisal review and independent negotiations, professionalism in the land acquisition organizations at all levels of government has been assured. As will be seen later in this chapter, the present Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 follows, to a great extent, the procedures advocated and developed by the BPR throughout the years. BPR’s early directives required the States to adopt acquisition practices which met the same basic goals that the Act later embodied.
Disposition of Improvements
How best to dispose of buildings and appurtenances purchased with land needed for highway rights-of-way is another important question involved in the right-of-way operations. Originally the disposition of improvements on the acquired right-of-way often was handled in an informal manner with no uniformity of treatment. A common form of disposition was to include the buildings in the prime construction contract as a clearing item and let the contractor dispose of them as he wished. This was permitted under a BPR right-of-way directive issued in 1956. At times, however, the contractor would sell the improvements to the former owner or others for a considerable amount and at the same time receive payment from the State for removing them from the right-of-way.
Since the contractor had no authority to operate outside the right-of-way, a building that was only partially within the right-of-way was often partially demolished leaving the remainder standing on the private property. This resulted in situations that were costly to the private property owner to correct.
To correct these situations, under current procedures, the owner of improvements and appurtenances on lands being acquired for right-of-way is allowed the option of retaining them at a retention value predetermined by the State through a comparative process with improvements sold at public sale. If the owner does not wish to retain the improvements, the acquiring agency will take title and sell them under competitive conditions. The objective is to dispose of the improvements by the method that will reflect the greatest amount of credit to the project consistent with equitable treatment for the former owner. Only under unusual circumstances should they be included in the construction contract as a clearing item. Where leadtime is sufficient, acquired properties are leased for private use on a short-term basis until the land is needed for construction of the highway.
Property in Public Ownership
Property in public ownership needed for highway purposes is treated differently. Originally BPR did not permit Federal participation in the cost of land already in public ownership. However, participation was permitted in the removal, readjustment, repair, or restoration of facilities made necessary as a result of the construction of the highway project. A later policy permitted Federal participation on the basis of the appraisal of the property taken and the resulting damages incurred. However, it proved to be difficult to determine the fair market value of public property, such as a school, firehouse, library, etc., that is not commonly bought and sold in the open market. In many instances, the local government was subject to additional burdensome costs of replacing the public facilities, since the old buildings could and would have served their purposes for many years.
Presently, when the State highway department makes a request and can legally incur costs for the functional replacement of real property and improvements in public ownership, Federal funds may participate in the costs if the functional replacement is determined to be in the overall public interest. The costs are those necessary to replace the land and improvements being acquired with a similar needed facility having the same use. Usually, the present buildings are old and out-of-date and the materials with which they are constructed are often not available. The new buildings may be constructed with modern materials and are required to be constructed in accordance with present day local laws, building codes, and reasonable prevailing standards in the area for similar facilities. If the owning agency has suitable land on which the new facility can be constructed, payment may be made for the land taken for highway purposes. If the owning agency does not have the land, a replacement site may be purchased.
