You are on page 1of 43

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.

103

ACQUISITION 103 STUDENT TRAINING MANUAL

i|P age

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103

ACQUISITION 103 PART B

i|P age

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103

5310 Donations of Real Estate …………………………………………………..………...53-1 5310.01 Procedure for Donation .......................................................................... 53-1 5311 Owner Retention of Improvements ............................................................................ 53-5 5311.01 Procedure for Owner Retention ............................................................. 53-5 5311.02 Procedure for Salvage Value.................................................................. 53-7 5311.03 Procedure for Amending Contract or Bill of Sale.................................. 53-8 5311.04 Procedure for the Agreement for Removal of Improvements – RE 66 ...................................................................... 53-9 Quiz 2 ................................................................................................... 53-18 5312 Encroachments ........................................................................................................... 53-20 5312.01 General Information ............................................................................. 53-20 5312.02 Clearing Encroachments ...................................................................... 53-20 5313 Boundary Surveys ...................................................................................................... 53-26 5313.01 Procedure to Address the Boundary Survey ........................................ 53-26 5313.02 Procedure for Amending the Contract ................................................. 53-27 5315 Outdoor Advertising Devices .................................................................................... 53-28 5315.01 Acquisition Procedure .......................................................................... 53-28 5317 Leasing Vacant Buildings During the Acquisition Phase of a Project .................. 53-30 5317.01 Procedure to Rent ................................................................................. 53-30 5318 Acquisition of Cemeteries ......................................................................................... 53-30 5319 Offsetting the Price Paid for an Acquisition Parcel by the Value of Excess Land .................................................................................... 53-31 5319.01 Procedure to Implement Law ............................................................... 53-31 5320 Acquisition of Contaminated Property ................................................................... 53-32 5320.01 Planning for the Acquisition of the Contaminated Property ................ 53-33 5321 Acquiring Property Subject to the Garage Law ..................................................... 53-34 5321.01 Procedure to Implement the Provision of Law .................................... 53-34 5322 Acquiring Property From Individuals Working for an Instrumentality of the State ...................................................................................... 53-36 5322.01 General ................................................................................................ 53-36 5322.02 Regulation Controlling Conflict of Interest for ODOT Employees ..... 53-36 5222.03 Procedure for Conflict of Interest ........................................................ 53-36 5323 Acquiring Real Property Subject to a Life Estate .................................................. 53-38 5323.01 Identifying a Life Estate Interest ......................................................... 53-38 5323.02 Acquisitions That Do Not Displace Life Tenants ................................ 53-38 5222.03 Acquisitions That Displace Life Tenants ............................................. 53-40
ii | P a g e

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103

5310

Donation of Real Estate Needed for the Highway Project

The donation process is heavily regulated. These regulations include: 1. 2. 3. 4. 5. Uniform Act, Title III, Section 301 (10) 49 CFR, Subpart B, Section 24.108 23 CFR Subpart E, Section 710.505 Ohio Revised Code, Section 5501.33, 5501.331 Ohio Administrative Code: 5501:2-5-06 (H)

A donation can be requested by the District anytime during the acquisition process, but the process for donation must follow these established procedures. 5310.01 Procedure for Donation A. Before an owner can donate anything, the owner must be informed of all their rights under law. This is assured by having the negotiator review the “Donation Letter” form with the owner. If the owner agrees to donate, the terms and conditions of the donation shall be documented by having the owner sign the “Donation Letter” form. The ODOT agent must sufficiently document the acquisition file to provide evidence that the donation process was done in compliance with regulation and these procedures. The documentation shall be in the Negotiator’s Notes (RE 60 and RE 60-1). The agency must secure an appraisal for the owner unless the owner releases the agency from the obligation of securing an appraisal. The appraisal must be performed by a qualified appraiser. 1. If the valuation is uncomplicated with a fair market value that is $10,000 or less, the agency can waive the appraisal. ODOT’s process for waiving appraisals is accomplished by using the Value Analysis format.

B.

C.

D.

E.

Any donation received prior to environmental clearance must meet environmental regulations specified in 23 U.S.C. 323 (d). For these early donations, the deed ODOT prepares must clearly state the following: 1. All alternatives to a proposed alignment shall be studied and considered pursuant to NEPA; Acceptance of the donation shall not influence the environmental assessment of the project, including the decision relative to the need to construct the project or selection of its specific location;

2.

1|P age

An owner may donate property in exchange for construction features or services .The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.505 (c) for more detail. The next page is an example of the Donation letter. The donated interest shall revert back to the grantor or his successors or assigns if the interest in not required for the alignment. 2|P age . G.See 23 CFR 710. See section 5501. 103 3. Donations of real property may be credited to the State’s matching share of the project See 23 CFR 710.331 of the Ohio Revised Code for more detail.505 (b) for more detail. F. The instruments used for donation are the standard instruments described in Section 5400 of the Real Estate Manual for instrument procedure.

103 3|P age .The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 4|P age .

but shall consider the merits of the request with respect to the clearance of the right of way. Additionally.01 Procedure for Owner Retention A.103 (c) and at the State level by the Ohio Administrative Code. An owner may request to retain an improvement the District Office is taking for the highway project. Section 5501:2-5-06 (C)(3). The amount ultimately paid to the owner at closing will be reduced by the Salvage Value of the item that is retained by the owner. the District must document that it purchased the improvement and then the District can release the improvement back to the property owner. The retention process is regulated at the Federal level by 49 CFR 24. Form RE 68 is the Salvage Value form used to estimate Salvage Value. The District is obligated to consider the owner’s request and the District Real Estate Administrator (REA) makes the decision regarding the owner’s request to retain an improvement.02 of these procedures for more detail about Salvage Value B. impact to the construction phase of the project and the affect to property management. Project managers must monitor the removal of the owner-retained improvement from the project area to ensure it does not adversely affect the construction phase of the project. the District Office must ensure the Salvage Value of the item to be retained is estimated and. the property owner and the District must agree to the Salvage Value amount. The regulations are identical and are: If the owner of a real property improvement is permitted to retain it for removal from the project site. 5311. 1. The District is not obligated to accept any proposed modification. D. 103 5311 Owner Retention of Improvements The owner retention process allows an owner to retain an improvement that is considered in the estimate of FMVE. the contract is amended to reflect the amount the owner will actually be paid at closing. When the REA allows an owner to retain an improvement.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 2. 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 entire interest in the real property and the salvage value of the retained improvement. The following procedures implement these regulations and assure clearance of the required rights of way. Therefore. See Section 5311. The District Office must document the improvement was purchased by ODOT prior to allowing the owner to retain the improvement to ensure clearance of the right of way. C. 5|P age . Once the District and the owner agree to the Salvage Value amount.

03 of these procedures for more detail about amending the contract. Funds are disbursed to the owner and the amount received by the owner is: FMVE of the Entire Acquisition Parcel Salvage Value of Improvement to be Retained The Amount Money Received by the Owner 2. its construction contractor does have the right to demolish the improvement if the owner does not remove the improvement per the terms stipulated in the RE 66. As the District can now document that it owns the improvement. G. The project manager must continue to track this acquisition parcel to ensure the improvement has been removed from the project area in the time frame and by the terms agreed to in the Agreement for Removal of Improvements form (RE 66). 2.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. E. The correct form is dependent on ownership and type of taking. The District must first document that it has purchased the improvement that will ultimately by retained by the owner.04 of these procedures for more detail about the Agreement for Removal of Improvements form (RE 66). The purpose for this action is to protect the construction phase of the project. F. The owner conveys the property right needed for the project by signing the instrument. 1. The negotiator must adequately document the owner retention process to demonstrate compliance with the legal requirements for retention and ODOT’s procedure to implement these regulations. The RE 66 details pertinent information about when the retained improvement is to be removed from the right of way. See Section 5311. 103 the owner and District must complete the Agreement for Removal of Improvements form (RE 66). 3. See Section 5311. 6|P age . (-) = 4. The parcel then moves to closing where: 1. The contract or the bill of sale is used to document the purchase of the improvement to be retained.

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. Estimate the cost to disconnect the item and move it to the curb. To implement the regulation requiring “The probable sale price of an item offered for sale to knowledgeable buyers with the requirement that it be removed from the property at the buyer’s expense”. Estimate the cost to disconnect the item and transport it to the salvage dealer. Section 5501:2-5-01(B)(25). The next part of the regulation is “When there is no reasonable prospect for sale. These procedures implement these regulations. Low Value (nominal) Salvage Value Estimates 1. the value of components parts of the improvement that can be reused or recycled when there is no reasonable prospect for sale except on this basis”.02 Procedure for Salvage Value Salvage Value is defined in 49 CFR Subpart A. not eligible for relocation assistance). 24. A. Step 4: Estimate the price a salvage dealer would pay for an item assuming the owner of the item had brought it to the dealer’s place of business.) Cost in Step 5 = Value B Step 5: Step 6: D. Once the value is estimated any change must be based on reasoned and documented analysis (similar to the establishment of FMVE).) Cost in Step 2 = Value A Step 2: Step 3: C. B. the following steps are taken: Step 1: Estimate the price a buyer would pay for an item as if it were sitting on the curb in front of the property available to be picked up by a buyer.. Cost in Step 4 ( . The District Offices do sell off improvements from 7|P age .e. Salvage value is documented on form RE 68. The definitions are identical and are: The probable sale price of an item offered for sale to knowledgeable buyers with the requirement that it be removed from the property at the buyer’s expense (i. This includes items for re-use as well as items with components that can be reused or recycled when there is no reasonable prospect for sale except on this basis. 103 5311. Cost in Step 1 ( . Steps 4 through 6 do not have to be taken if it can be determined a purchaser would buy the improvement while it is on-site.2 (a) (23) and in the Ohio Administrative Code. It is the intention of ODOT that reasonable procedures be established for estimating salvage value.

” B. salvage value may be calculated as a percentage of the F. The process to obtain experts that provide cost estimates can be time consuming and costly. re-analyze the salvage value estimate. and (iv) the terms and conditions of Seller’s retention are set forth in the RE 66 Agreement for Removal. Then a paragraph pre-approved by the Ohio Attorney General’s Office is inserted into the contract or bill of sale. The selection of the RE 220-B or the RE 220-L is 8|P age . If this process does not result in a salvage value agreeable to all sides. the District may consider reasons for disagreement and if valid. the total amount paid for the property must be shown on the contract or the bill of sale. 2.M. E. Salvage value could also be estimated by utilizing the services of an expert in the field of the improvement that is to be salvaged. This amount can be the FMVE or an administrative settlement amount. For substantial improvements retained by the owner (over $10.000). 103 time to time and it is incumbent that the person estimating salvage value analyzes prior sales of these kinds of properties in the determination of salvage value. the support for any re-establishment of salvage value must be included in any revised RE 68. This pre-approved paragraph documents the amount paid to the owner at closing is reduced by the salvage value of the item retained. (ii) the amount to be paid to the seller shall be reduced by the sum of $(insert: salvage value estimate).The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. Once the salvage value has been determined. reason and caution must be exercised when developing this percentage and under no condition should the same percentage be used in all instances.E. The Contract For Sale and Purchase is to be used when the fee owner of the property also owns the improvement to be retained. However. In either case. 5311. reads as follows: “Seller and Purchaser agree that (i)Seller shall be permitted to retain improvements now situated on the real property to be conveyed (see RE 66/Agreement For Removal for details). of the improvement to be retained.03 Procedure for Amending the Contract or Bill of Sale A.V. which is the salvage value of the retained improvement. for low value items which are to be retained. the owner is to advise the negotiator if the salvage value price is acceptable. The District may also utilize the administrative settlement procedure for opinion differences in salvage value. However. This paragraph. Negotiations will continue and eventually an agreement to price and terms should be reached. the negotiator shall communicate this value to the owner and. Low value is defined as any improvement which is to be retained as having a contributory value of $10. available from the Office of Real Estate’s web page and entitled “RE 220-1 Insertion for Owner Retention”.000 or less. then the negotiator shall fall back to the District’s original offer. these cost estimates are a necessity. If the owner does not agree with the salvage value estimate. (iii) the total amount Purchaser shall pay ultimately to the seller is $(insert: the difference between FMVE and Salvage Value). This process shall be documented in the Negotiator Notes. However.

Price and Consideration. as a new second paragraph following the value of the tenant-owned improvement. The District Office needs to track the removal of the improvement to ensure it has been removed from the project area by the date stipulated in the RE 66 and the site has been left in a condition that is compliant with the terms of the RE 66 (i.04 A. After the owner receives payment. The amount established as FMVE is never changed and remains constant through the entire acquisition process. When confronted with this situation. See Section 5200 of the Real Estate Manual for more detail regarding contracts. the 9|P age . the District Office must ensure that it was done in compliance with the terms in the RE 66 and any holdback money can then be released to the owner.contrary to the terms of the RE 66 which required the owner to fill the basement in. the District Office can go onto the property and remove the improvements. the owner retained a house. if applicable) within 90 days of the Agreement. C. into the contract at the end of the first paragraph of 1. C. The District Office can hold back money at closing to ensure the owner performs and moves the improvement out of the project area by the date that was mutually agreed to by the owner and District. Procedure for the Agreement for Removal of Improvements form (RE 66) 5311. 2. After the improvement is moved. moved the house. ODOT must pay the owner this holdback money within 60 days after it has accepted the work. RE 220-1.e. The bill of sale form (RE 69 CC) is used when the improvement to be retained is owned by a tenant-owner. D. the owner must start work to move the improvement within 14 days. 1. B. This is the reason why the District must document that it purchased the improvement.) The RE 66 also requires: 1. but had left the basement foundation open . 103 dependent upon if the improvement is a building or a structure. The RE 66 details the terms for removing the improvement that is to be retained by the owner. ODOT to pay the owner the agreed amount (FMVE less salvage value and less holdback. RE 220-1. If the owner did not comply with the terms of the RE 66.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. Holdbacks may be used at the discretion of the District Office and should be based on the degree of risk that the owner will not remove the item to be retained. 3. 1.. Insert the pre-approved paragraph. Insert the pre-approved paragraph.

103 District should request guidance from the Ohio Attorney General’s Office. D. The next few pages are forms used when documenting the purchase of an improvement when dealing with owner retention. Any costs incurred by ODOT for removing the improvement can be deducted from the holdback money.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. The Agreement for Removal of Improvement process must be adequately documented to demonstrate compliance with these procedures. RE 68 Salvage Value Estimate The RE 220 (Contract of Sale and Purchase) RE 69AC Bill of Sale RE 220-1 Insert (Owner Retention) RE 66 Agreement for Removal of Improvements After form RE 66(Agreement for Removal) example go to Case Study# 2 10 | P a g e .

103 11 | P a g e .The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 12 | P a g e .

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 13 | P a g e .

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 14 | P a g e .

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 15 | P a g e .

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 16 | P a g e .

103 17 | P a g e .The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 18 | P a g e .

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 19 | P a g e .

in the director’s opinion. there is no requirement for a written encroachment certification. 20 | P a g e . Methods of clearing encroachments are discussed in numbers 1 through 4 below. This right is based in Section 5515.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. or any object or structure. “If. Clearing Encroachments from an Active Project Right of way encroachments shall be cleared on all federal-aid projects. 5312. the District will not pay for the removal costs or compensate the owner for the improvement’s value. R/W or construction). pipes.” B. pipes. shall remove same from the bounds of the highway. If federal funds were not used in any phase of the project at the time the right of way was initially acquired or the acquisition occurred before the Highway Trust Fund was established (July 1. the District Deputy Director should always be consulted immediately before removing any encroachment under this provision of law. C. 103 5312 Encroachments 5312. In almost every instance. Section 5515. On all federal-aid projects. or corporations using or occupying any part of a road or highway on the state’s highway system with lines. the certification of the right of way to FHWA must state the right of way is free and clear of all encroachments. the director may remove or relocate the obstruction or properties without prior notice. However. the obstruction or properties present an immediate and serious threat to the safety of the traveling public. 1956).01 General Information A. objects or structures is not started within 5 days after notification. the Department may do so with their own forces and the expense incurred shall be certified to the Attorney General for collection by civil action. firm. without a legal permit.02 of the Ohio Revised Code which states that: Any individual. A federal-aid project is defined as a project having Highway Trust Funds in any part of the project (PE. an encroachment in the right of way shall be removed at the expense of the owner and. Section 5515.02 also allows a district to move the obstruction under certain conditions: If removal of any such lines. All encroachments need to be specifically identified and shown on the project plans.02 Clearing Encroachments A.02 also provides a district with emergency powers under certain situations.

This process of issuing a permit may be used only if there were NO federal funds used in any phase of the original project at the time the right of way was acquired 2. Allow the encroachment to remain and issue a permit When ODOT owns the property by any estate that is less than fee title. Reference the Property Management Section of the Real Estate Manual for information about disposal of land determined to be excess. 4.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. Office of Real Estate. B. The lease must be at fair market rent. Reference the Property Management Section of the Real Estate Manual for detailed information. Allow the encroachment to remain and lease the property The district may allow the encroachment to remain and lease the property if ODOT owns the property by fee title and has determined the right of way is needed for future highway purposes and the encroachment is not a safety hazard. 21 | P a g e . written by G. Remove the encroachment The owner should be notified by personal contact and be made aware that a certified letter will be forthcoming indicating the time frame for removal. 1996. Michael Payton.C.O. Sell or vacate the land that is being encroached upon The district may sell or vacate the land to the adjoining property owner if the right of way is not needed for present or future highway purposes. 3. Administrator. the district may allow the encroachment to remain and issue a permit allowing the encroachment to stay subject to the terms of the permit. If the owner does not comply as instructed. For more information on encroachments reference the I. the matter is to be forwarded to the Transportation Section of the Ohio Attorney General’s Office for processing. 103 1. June 3.

The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 103 22 | P a g e .

103 23 | P a g e .The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.

103 24 | P a g e .The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.

103 25 | P a g e .The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.

If it is determined the burden is caused by the ODOT project. The contract also requires the owner to indemnify ODOT from any future liability regarding any future boundary survey issues. then ODOT must pay the cost of a boundary survey or provide the owner with a survey of their residue property.203 and 315. See Section 5313. There is no consistency with respect to boundary survey requirements between the 88 counties of Ohio. 2. The District Offices should maintain a list of the recording requirements of each of the counties.106. 26 | P a g e . 2) Rule F.251 (A) of the Ohio Revised Code. the following procedure shall be followed: 1. Should the owner sell this residue at a future date. The District Office should estimate the cost estimate of a boundary survey using the knowledge of it’s in- 2. at a future date. This residue survey can be completed during the plan development process as the District has surveyors in the project area working on the highway plans. ODOT shall either provide such survey or pay for a survey or reimburse the owner for the cost of such a boundary survey so that the owner does not have to pay the cost directly. The County Auditor has the right to require a Boundary Survey per Sections 319. If it’s determined the County Auditor requires a boundary survey. This burden placed upon the property owner may be a direct result of ODOT’s highway project. The Contract for Sale and Purchase shall be amended to reflect the boundary survey. the owner decides to sell the residue or a portion of the residue. 1. and.01 Procedure to Address the Boundary Survey A. The contract details the amount that ODOT will pay the owner for the boundary survey. If the District decides not to provide the owner with a survey of the residue property.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. Section 5501:2-5-06 of the Ohio Administrative Code. The cost of the boundary survey is considered an expense incidental to the transfer of title to the agency per: 1) 49 CFR 24. This incidental expense becomes part of the closing process. The District Office needs to determine if the County Auditor will require a boundary survey of the residue property when. 5313. The District Office may decide to provide the owner with a survey of the residue. the County Auditor may require a survey describing the legal description of the residue before the sale can be recorded. 103 5313 Boundary Surveys The County Auditor may require a boundary survey of a residue property because a partial acquisition by ODOT leaves a residue property and this residue does not have a legal description. B.02 of these procedures for more detail regarding the contract.

If settlement is approved by the District Real Estate Administrator. ODOT will appropriate the property. The boundary survey paragraph that is inserted into the contract has been pre-approved by the Ohio Attorney General’s Office and is to be downloaded from the Office of Real Estate web page. The amount established as FMVE is never changed and remains constant through the entire acquisition process. 103 house surveying staff. The cost can also be obtained from local surveying companies. 5313. The terms for the boundary survey are to be inserted into the contract. The boundary survey costs ODOT will pay are: a. 4. 3. Insert this language into the contract at the end of the first paragraph of 1.3% of the cost of a boundary survey if after the ODOT acquisition. Purchaser shall pay to Seller the further sum of [Insert $ amount for B. b. The entire cost of the boundary survey of the residue property if the ODOT acquisition causes a boundary survey to be required by the County Auditor when the owner next sells the residue property. If ODOT and the owner cannot agree on an amount for the boundary survey. The correct paragraph to be selected is entitled “RE 220-2 Insertion for Boundary Survey Expense”. 33. The insertion reads as follows: In addition to the foregoing [Insert $ amount from Line 1. c.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. If the owner accepts these conditions. The NIAGFO letter and the FMVE are not changed. 5. the contract is amended to reflect the amended survey amount. the County Auditor will allow the owner two more transactions before it requires a boundary survey. Price and Consideration. the negotiator needs to determine from the owner what he/she considers to be a reasonable cost. The change will be to the boundary survey amount in the contract. This is a counter offer and it can be dealt with by the administrative settlement process. the County Auditor will allow the owner one more transaction before it requires a boundary survey. the parcel is processed through billing and on to closing. Section 1] being paid for the reasons aforesaid. 50% of the cost of a boundary survey if after the ODOT acquisition. 27 | P a g e . If the owner challenges the boundary survey cost estimate. 6.02 Procedure for Amending the Contract A. The cost should be based on the size and complexity of the residue property.

and. as a result of the Seller obtaining a survey of the residual lands of Seller and/or the effects or consequences thereof. and at sports stadiums and arenas. See the 28 | P a g e B . past. are typically permitted. and the sign face is frequently changed to reflect new ads. There is a difference between outdoor advertising devises and signs that advertise a place of business (or other business-related signs like entrance or exit signs). classifies these advertising formats into: 1) billboards. Other forms of advertising exist on buildings. subways. The District Office must contact ADC and request a determination of the legal or illegal status of any outdoor advertising device that is to be acquired prior to valuing the sign or making an offer to the sign owner. 2. Billboards are common examples of outdoor advertising devices. Inc. Highway plans must identify an outdoor advertising device as a take item. buses and taxis. The RE 95 process is required for any taking of any sign or advertising device. but may not have determined if the device was legally permitted. present or future which can or may ever be asserted. airports. and in malls. bus shelters. claims. Seller does hereby release and forever discharge Purchaser from all debts. 4) alternative media. actions and causes of action whatsoever. In accepting such offset of [ Insert $ amount for Boundary Survey Expenses]. 103 Boundary Survey Expenses] to offset any and all of the expenses Seller might incur for a survey of the residual lands of Seller at such future time as when Seller seeks to transfer all or any part of the residual lands of Seller. ODOT does not pay for advertising devices that are not legally permitted or that are an illegal encroachment into the State’s right of way. 1. Outdoor advertising devises exist to generate income.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. The Outdoor Advertising Association of America. 5315 Outdoor Advertising Devices Outdoor advertising devices (also known as billboards or signs) located within areas to be acquired for ODOT’s highway projects can present unique problems when these devices are not properly permitted and/or encroach into the State’s right of way. 2) street furniture.01 Acquisition Procedure A. 5315. The ODOT Office of Advertising Device Control (ADC) does maintain records on these devices and can advise of legal or illegal status. These signs can be owned by the fee owner of the land or could be tenant-owned. demands. The sign face does not generate income. This is required as there is a high propensity for signs (advertising devices) to be tenant-owned. 3) transit. Business signs are generally situated in front of a place of business and identify places of business. See the 5200 Section of the Real Estate Manual for more detail about the RE 95.

105 and the ODOT procedure for acquiring tenant-owned improvements is Section 5302 of the Real Estate Manual. 29 | P a g e . 3. 2. 103 5302 Section of the Real Estate Manual for more detail about tenant-owned improvements. that exist between the outdoor advertising company and the fee owner of the property. 1. This information needs to be provided to the appraiser. it shall report the terms and conditions of the sale to the Office of ADC. The acquisition process for the tenant-owner parcel. After the District Office acquires the outdoor advertising devise. must comply with the Federal regulations that govern tenantowned improvements. there can be a third party lease between the owner of the billboard structure and another company that is leasing the sign faces. The entire acquisition process must comply with the Uniform Act. Acquisition parcels that include an outdoor advertising device generally involve multiple ownerships. the acquisition files must sufficiently document compliance with these procedures and Federal regulation.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. D. Additionally. if possible. C. These circumstances may require two or more separate negotiation parcels. The Federal regulation is 49 CFR 24. Often there is a fee owner of the land and a tenant-owner of the outdoor advertising device. Additionally. The District Office needs to secure copies of any leases. typically the outdoor advertising device.

Therefore. The resulting eligibility for relocation benefits can increase project costs due to large rent supplement payments. E. B. early involvement with District Office and the Transportation Section of the Ohio Attorney General’s is critical for project delivery. 5318 Acquisition of Cemeteries A highway project taking real property occupied by a cemetery may need to disinter human remains and relocate the remains to another suitable location. This process presents time intensive challenges and therefore. A negotiator or relocation agent is to negotiate with the property owner for the rental of the vacant building or unit. Before a building or unit is rented there will be coordination between the relocation and acquisition functions in the District Office. D. 1.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq.2 (6)(viii) (C). 30 | P a g e . C. negotiations will discontinue and the owner is free to rent to whomever he/she chooses. 5317.2 (9) and 49 CFR 24. project management decisions to rent vacant buildings within the take area can lower project costs and facilitate the clearance of the right of way by taking these types of buildings off the market. the property owner has the right to lease vacant buildings to tenants and the District will need to provide relocation benefits to these subsequent tenants. The justification for the rental amount is to be a part of the Negotiator’s Notes. Federal regulation requiring relocation eligibility for subsequent tenants is 49 CFR 24. The negotiated rental amount is to be reasonable and justified.01 Procedure to Rent A. No properties are to be rented until the original tenant has voluntarily moved from the site. 103 5317 Leasing Vacant Buildings During the Acquisition Phase of a Highway Project Unless the District Office controls the possession of the building. The agent shall use the rental contract form RE 123. If the property owner refuses to rent the property/unit for the amount determined. either by the owner conveying the title of the property to ODOT at closing or by an appropriation action. The District Office has discretion for the ultimate rental amount agreed to with the owner. even if the rent was negotiated by a relocation agent.

211 does not affect the authority of the Director to convey unneeded property pursuant to ORC 5501. 103 A cemetery may be privately owned or may be owned by a township or a city.01 Procedure to Implement this Law A.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. ORC 163.02 (D)(3) states that the provision in 163.42 (F).42 (F). there are legal mandates regarding disinterring and moving human remains. Federal funding requires the approval of FHWA prior to the disposal of the excess land. So. Also. to avoid valuation problems. The District Office makes a determination if there are any excess lands along the same corridor as the property being acquired for the highway project. However.34 (F) of the Ohio Revised Code. 5319 Offsetting the Price Paid for an Acquisition Parcel by the Value of Excess Land The District Office may offset acquisition costs along a project corridor by selling off excess land located along that corridor to owners whose properties are being acquired for the project. property that was not used for its intended purpose – see ORC 163.34 (F) of the Ohio Revised Code. Due to the multiple complexities involving the acquisition of real property from a cemetery. Chapter 163 of the Ohio Revised Code was amended in 2007 and its amended provisions do not prohibit ODOT from conveying property pursuant to ORC 5501. The process of determining the valuation format must also consider if there were any Federal funds utilized in the purchase of the land now considered as “excess”. 5319. in some instances. Land determined to be “excess” and available to be sold along the project corridor must be appraised according to Section 5501. Depending on ownership classification. These legal requirements may require notification of relatives and/or court action. If the value of the excess land exceeds the amount of compensation.211. There is no one valuation format that is appropriate in all instances when determining the correct valuation format. See the following provision: The amended code allows an owner the right to repurchase back from ODOT. the owner will need to pay ODOT the difference at closing. This is permitted under Section 5501. 31 | P a g e . The District Office shall analyze the conditions of the disposal parcel and shall then choose the appropriate valuation format as described in the appraisal section of the Real Estate Manual. guidance and direction shall be obtained as early as possible from the Attorney General’s Office (AGO) and there shall be no acquisition of any cemetery property until the AGO provides guidance on how to proceed with the acquisition. it is prudent to involve FHWA in the decision of the appropriate valuation format for the land disposal. the ODOT may not be able to exercise its right of eminent domain. B.

E. Purchaser has declared the real property identified as [ Cty-Rte-Sec]. (3) also pursuant to R. The procedures for the Governor’s Deed are in Section 7400 of the Real Estate Manual under Property Disposal.C. Insert this paragraph into the contract at the end of the first paragraph of 1. This paragraph is downloaded from the Office of Real Estate web page. the consideration to be delivered by Purchaser to Seller for the real property identified in Exhibit “A” shall include the real property identified in Exhibit “1”. either RE 220-B or RE 220-L. This requires an immense amount 32 | P a g e . Section 1]. D. F.34 (G) of the Ohio Revised Code.E to be excess land that has an appraised value of [Insert $ amount of appraised value of “E” parcel]. The negotiator shall offer the property owner the established FMVE for the real property needed for the highway project as is typical with any offer using the forms and procedures described in the 5200 Section of the Real Estate Manual. The paragraph selected is entitled “RE 220-3 Insertion for Land Swap”. 5501. A paragraph is inserted into the contract that has been pre-approved by the Ohio Attorney General’s Office. the District Office acquires the property needed for the project and conveys the excess land to the owner. The conveyance of the excess parcel under this section shall be by Governor’s Deed as prescribed in Section 5501.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 5501. 103 C. whoever owes balance] to the other party. Parcel No.C. and the difference between the those two sums. and (4) the appraised value of the real property described in Exhibit “1. Price and Consideration. Section 1] . Depending if there are buildings in the take area. ## . shall be paid in cash or equivalent by [Insert Purchaser or Seller. below) to Purchaser for a Total Purchase Price of [Insert $ amount from Line 1. (2) pursuant to R. the negotiator shall use the correct variation of the Contract For Sale and Purchase.” namely [Insert $ amount of appraised value of “E” parcel] shall be credited against the Total Purchase Price of [Insert $ from Line 1.34(F). 5320 The Acquisition of Contaminated Property The acquisition of contaminated property present unique acquisitions requiring much information at the start of the acquisition process so that wise decisions are made and so the appraiser can be adequately scoped to ensure ODOT receives a valid appraisal. The terms and conditions for the compensation offset are to be inserted into the contract. which is more particularly described in Exhibit “1” attached hereto and by this reference incorporated herein.34(F). The insertion reads as follows: Purchaser and Seller agree further as follows: (1) Seller will sell the real property identified in Exhibit “A” attached hereto (see Section 2. This process is done to ensure compliance with the Uniform Act and to preserve ODOT’s appropriation authority if agreement with an owner cannot be reached. The negotiator is to sufficiently document this process to show compliance with the Ohio Revised Code and these procedures. namely [Insert $ difference between Total Purchase Price and Appraised Value of “E” parcel]. At closing.

Assume there is no contamination and value the property as if it were clean.01 Planning for the Acquisition of the Contaminated Property A. At this meeting. 8) Would a lending institution loan money to someone to purchase this property and if so. Office of Real Estate. the Appraisal Unit The appropriate District personnel such as DEC and DREA B. 5) Would the owner be required to clean the site if ODOT’s project had not impacted the property. The District Environmental Coordinator (DEC) shall memorialize any meeting by taking notes detailing the relevant issues that were discussed and will distribute these notes by IOC (Interoffice Communication) to the District Real Estate Administrator (DREA) prior to the acquisition phase of the highway project. Generally. 3) Environmental site assessment investigations that have been done and the results of those investigations.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 3. all issues regarding the contamination shall be discussed and ultimately a decision will be made about how to value the property. The District Office needs to beware of purchasing at such an accelerated schedule that adequate environmental studies have not been completed which result in the purchase of a property that is heavily contaminated and where ODOT paid full market value and was not aware of the contamination. 4. These discussions should include: 1) The type and extent of contamination within the take and on the residue property. the Office of Chief Legal and the Ohio Attorney General’s Office. If it is determined a meeting is needed. If the DEC decides a meeting is unwarranted. the DEC must advise the Real Estate Administrator regarding the contamination at the initiation of the acquisition phase of the highway project. meetings may be required to adequately address relevant issues. how would a property owner typically clean or remediate the site. 7) What is the cost to remediate the site. 2) Information from BUSTR (Bureau of Underground Storage Tank Regulation. 9) What property right should be purchased. 2. the Office of Environmental Services. there are three valuation options: 1. 33 | P a g e . Contaminated properties should be identified during the planning phase of a project. Once contamination is uncovered. At the acquisition phase of the DEC and DREA shall jointly decide if meeting is required to address contamination to ensure a valid appraisal is obtained. it is recommended the District receive input from: 1. 5320. under what conditions. Transportation Section The Office of Real Estate. 103 of communication between the District Office. 6) Ignoring the way ODOT handles contaminated dirt. The Office of Environmental Services (the Environmental Site Assessment Supervisor) The Office of the Ohio Attorney General. C. 4) Would the contamination have been found if ODOT’s project had not impacted the property.

” This provision of the Revised Code is only applicable in instances where the ODOT highway design removes the garage and there is insufficient land to replace the garage. 3. during the preliminary right of way plan phase when acquisition work plans and cost estimates are being prepared). When a property appears to meet the conditions of the “Garage Law”. appraisal and relocation processes to ensure an owner is adequately made aware of their rights and benefits and to ensure the project can be cleared by the District R/W Clear Date. but we would not acquire the entire property per R.05(G). If the design does not remove the garage. 163. the appropriation shall be for the whole parcel and all structures unless.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. relocation offers. but impacts it such that it may not be feasible to continue its use as a garage. will require before and after appraisals. 5321 Acquiring Property Subject to the Garage Law Ohio eminent domain law provides the owner of a residence with a unique right commonly known as the “The Garage Law”. the District is to physically inspect the outside of the property and compare it against the R/W plan to determine: 34 | P a g e B.01 Procedure to Implement the Provision of Law A.C. 5321. the owner waives this requirement. at the discretion of the owner. The District Office must identify properties subject to this garage legislation early in the project (i. 103 2. the owner may be entitled to compensation in the form of damages. in which case the agency shall appropriate only the portion that the agency requires as well as the entirety of any structure that is in whole or in part on the required portion. . This law is Section 163. The law requires the District Offices to interrelate acquisition. will require two offers of compensation and may require much more time than what is typical to complete. The owners of these properties need to be among the first to receive good faith offers and if determined eligible. Early identification is critical as these categories of properties may be eligible for relocation benefits. The following procedures are established to implement this regulation into ODOT’s acquisition process.05 (G) of the Ohio Revised Code and is stated as follows: “In the event of an appropriation where the agency would require less than the whole of any parcel containing a residence structure and the required portion would remove a garage and sufficient land that a replacement garage could not be lawfully or practically attached.e. Assume there is no contamination and value the property as if it were clean (minus) the cost to clean the site or remediate the contamination.as contaminated. Make no assumptions and value the property as it exists .

. the District Office will only acquire what it needs for the project and will estimate damages. The owner will be offered compensation for the part taken and damages. F. During the pre-acquisition survey. If there is room on the residue property to replace the garage. Treated as a relocation parcel A residential use property subject to the “Garage Law” is to be treated as a relocation parcel and a pre-acquisition survey needs to be completed as early as possible. 3. 4. If there is an existing garage with the property before the taking. The appraisal process A before and after valuation shall always be done of the property. to the part not taken. to make a separate offer for the part needed for the project and damages. 2. ODOT is not required to offer compensation to replace the garage. any. if any. The appraiser must value the property before the taking having a garage and then value the property after the taking having no garage. 103 1. E. The appraisal reviewer shall fill out form RE 22 in a format similar to an uneconomic remnant. The garage cannot be replaced If the determination is the garage cannot be replaced on the residue property. if. if any.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. The garage can be replaced on the residue If it is determined the garage can be replaced on the residue property. C. The appraiser must be scoped to support within the appraisal report that a garage can be physically replaced on the residue. or. to the part not taken. If the property is utilized as a residence. See Section 6203 of the Real Estate Manual for more detail regarding relocation procedures and pre-acquisition surveys. The District Office will make the property owner aware of all acquisition compensation and relocation benefits potentially available to him/her before the owner can make an informed decision about waiving the requirement for the agency to purchase the entire property. The form shall detail the amount of compensation assuming ODOT purchased the entire property and the amount of compensation assuming the owner keeps their residue property. legally replaced on the residue or functionally replaced on the residue. can be legally replaced on the residue and can be functionally replaced on the residue. The appraiser must be scoped to support within the appraisal report whether or not a garage can be physically replaced on the residue. to the part not acquired. If the taking will remove the garage. the before and after value can always be used to make an offer for the whole. Ohio eminent domain law requires ODOT to acquire the entire property unless the owner waives this requirement and chooses to retain the residue property without the utility of the garage which is taken as a part of the project. the agent shall inform the owner of the “Garage Law” legislation. 35 | P a g e D. If the owner changes his/her mind.

Any official or employee of an instrumentality of the state (including employees of the state or an LPA) who has an interest in property impacted by the project cannot be in a decision making position with respect to any aspect of the project.01 General A. Federal Code. H. the relocation comping process should start. make. or to take part in negotiating. Prior to this offer. The negotiator shall adequately document this process and shall document the decision of the property owner in the Negotiator Notes.33 Conflicts of interest.The Office Of Real Estate Ohio Department of Transportation 2012 Training Course – Acq. The second good faith offer shall consider the property as if the owner decided to waive the requirement of the agency to purchase the entire property. 103 The District Office shall establish two different FMVE’s which will be the basis for two good faith offers. any 36 | P a g e . accept or approve. Part 1 Section 1. This is a conflict of interest. The NIAGFO The first good faith offer shall consider the property as if ODOT acquired the whole property. 23 CFR. The negotiator shall have the owner sign the “Garage Acquisition Election form” which documents the owner’s decision about selling the whole property to ODOT or keeping the residue property. G. 5322. directly or indirectly. This offer will assume the owner keeps the residue property.02 Regulation Controlling Conflict of Interest for ODOT Employees A. Officials or employees who have an interest in property impacted by the project and who are in a decision making position must disclose this fact and recuse themselves from any involvement in the project. making. No official or employee of a State or any other governmental instrumentality who is authorized in his official capacity to negotiate. The acquisition offer and the relocation offer are to be made on the same visit with the property owner. Officials or employees who have an interest in property impacted by the project but who are not in a decision making position must disclose this fact and sign a Conflict of Interest form. accepting or approving any contract or subcontract in connection with a project shall have. 5322 Acquiring Property From Individuals Working for an Instrumentality of the State 5322.

No officer or employee of such person retained by a State or other governmental instrumentality shall have. design. Federal and state law prohibits any official or employee of an instrumentality of the State of Ohio from participating in any acquisition activities or decision-making activities when real property owned by the employee is affected by a highway project. any step in the Project Development Process (PDP) or in the project selection process. other than his employment or retention by a State or other governmental instrumentality.42 (A) (1) No public official shall knowingly do any of the following: Authorize. Decision making activities can include. inspector or other person performing services for a State or a governmental instrumentality in connection with a project shall have. or any business associates has an interest. closings and title work. in any contract or subcontract in connection with such project. a member of his family. Title 2921. any financial or other personal interest in any real property acquired for a project unless such interest is openly disclosed upon the public records of the State highway department and of such other governmental instrumentality. or employ the authority or influence of his office to secure authorization of any public contract in which he. appraisals. relocation. 1. 2. the decision to acquire or appropriate property needed for the project. No engineer. a financial or other personal interest. Consequently. Acquisition activities include. 103 financial or other personal interest in any such contract or subcontract. Ohio Revised Code. funding. Recuse is defined as “to remove (oneself) from participation to avoid a conflict of interest. a family member or business associate have an 3. attorney. 5322. employee or person has not participated in such acquisition for and in behalf of the State. acquisition. but are not limited to.” If an official or employee is part of any decision making activity related to the project and determines that they.03 Procedure for Conflict Of Interest A. It shall be the responsibility of the State to enforce the requirements of this section. directly or indirectly. and such officer. construction. 4. appropriations.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. directly or indirectly. 37 | P a g e . 5. appraisal reviews. negotiations. B. appraiser. but are not limited to: planning. any official or employee who has an interest in real property that may be acquired or appropriated must recuse themselves from any participation in the acquisition process or decision making activities. Instrumentality of the State of Ohio includes ODOT and LPA’s.

plus the right to the beneficial interest in the property upon death of the life tenant or the third party. but still must disclose the fact that he/she owns an interest in the real property that is needed for the project no later than the initial negotiation contact when the negotiator presents the “Notice of Intent to Acquire and Good Faith Offer”. The form can be downloaded from the Office of Real Estate web page. Once the official or employee discloses the fact they have an interest in the property to be acquired. a. often known as the life tenant. the District Real Estate Administrator shall sign the form. that person must immediately disclose this fact and recuse themself immediately from the project. c. the County Engineer or the City Manager or Mayor are to be provided a copy of the signed form. 5323 Acquiring Real Property Subject to a Life Estate The creation of a life estate divides the fee simple estate into two lesser estates held by the life tenant and the remainderman. Once the official or employee signs the form. or. or the life of a third party. 6. the negotiator shall have the official or employee sign the form entitled Conflict of Interest Statement. Central Office Deputy Director if the person is an employee of Central Office. 103 interest in property that is affected. and control. The owner is then provided a signed copy and another copy is retained in the parcel file. page 54 38 | P a g e . a. limited to the lifetime of a designated party. Additional copies are distributed as follows: District Deputy Director if the person is an employee of the District. occupancy. 2nd edition. while the remainderman holds all other rights to the fee simple estate. Source: Real Estate Valuation in Litigation. The life tenant holds the beneficial interest in the property for his or her life. If the official or employee is not part of any decision-making process. that person does not need to recuse themselves.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. A life estate has been defined as total rights of use. For LPA projects. It has been well established that a life tenant is an owner in the constitutional sense and is entitled to compensation in an eminent domain proceeding.

The appraiser is scoped to value the property assuming a single ownership. FMVE is established. assignment letters and/or release of life estate must be created by the Attorney General’s Office. The RE 22 is completed. the existence of a life estate can be identified during the RE 95 process and/or the pre-acquisition survey done on relocation parcels. When a decision is made to cut more than one warrant. An acquisition that displaces a life tenant B. a life estate can exist without being recorded. or a 2. 103 5323. the Title Report should identify the life estate. 5323. ODOT will need to turn the parcel over to the Ohio Attorney General’s Office for appropriation if agreement cannot be reached with all ownership interests. relocate the life tenant off the project area. It may also be necessary to obtain additional guidance from the Ohio Attorney General’s Office. only the remainderman interest signs the ODOT instrument. The District Office should get guidance from the Office of Accounting for other allocations of compensation. The owner named on the NIAGFO is the life estate interest and the remaindermen interest. These acquisitions are not relocation parcels and the life tenant retains occupancy on the residue property. C. An acquisition that does not displace the life tenant. However.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. C. A W-9 will be obtained from each life estate holder and remainderman receiving a warrant from ODOT. The amount of compensation is the total FMVE.02 Acquisitions That Do Not Displace Life Tenants A.01 Identifying a Life Estate Interest A. The life estate interest must sign a release of life estate which will be prepared by the Ohio Attorney General’s Office. the District Office is to call Central Office Real Estate. If uncertain of what action to take. B. The reviewer shall not allocate compensation into the life estate interest or the remaindermen interest. The negotiator shall create the “Notice of Intent to Acquire and Good Faith Offer” (NIAGFO). All parties must agree to the price paid. A life estate cannot be ignored. Once a life estate is uncovered it is categorized into either: 1. the District Office must develop a plan of action to acquire the property rights needed for the highway project and if required. Life estates must be identified as early as possible so there is adequate time to perform acquisition and relocation activities. If a life estate is a matter of public record. At closing. In these instances. A closing is scheduled once all parties agree to the price paid. Once identified. 39 | P a g e .

the District Office is to request the Ohio Attorney General’s Office to prepare the legal documents that dissolve the life estate interest and that allow the remaindermen to convey their interest to the life estate holder. As this process is underway. the acquisition. 103 5323. 5. B. The life tenant is considered a 180 day owner occupant. This acquisition takes the dwelling occupied by the life tenant and may entitle the life tenant to relocation benefits. appraisal and relocation processes become more complex. 4. If these parties desire to use their own attorneys. Each situation is unique and guidance is required from Central Office Real Estate. An acquisition offer and relocation offer can be made once the life tenant is legally the fee owner.The Office Of Real Estate Ohio Department of Transportation 2013 Training Course – Acq. 2. C. This process must happen at the beginning of the acquisition phase of the project as it may require significant time for the parties to discuss this option and to arrive at a mutual agreement. 40 | P a g e . Dissolve the Life Estate Allowing the Life Tenant to Become the Fee Owner 1. The acquisition offer will treat the life tenant as a fee owner.03 Acquisitions That Displace Life Tenants A. 3. The relocation offer will treat the life tenant (now the fee owner) as a 180 day owner occupant and the relocation agent shall comply with the Relocation Manual. Sections 6000 through 6700 of the Real Estate Manual. having the remaindermen convey their interest in the real estate to the life tenant and allow life tenant to become the fee owner. Once FMVE is established the relocation comping process can be initiated. the property is to be appraised. If the parties cannot mutual agree to dissolving the life estate. As the ODOT project has caused the problem. Legal documents created by other attorneys are to be reviewed by the AGO. ODOT shall pay reasonable attorney fees. Early identification of this issue is critical to ensure clearance of the right of way. The District Office needs to meet with the life estate tenant and the remaindermen to determine if all parties are agreeable to dissolving the life estate. the appraisal is to be reviewed and FMVE is to be established.