BDC19T-03 dated 20190913

STATE OF NEW JERSEY DEPARTMENT OF

TRANSPORTATION

Right of Way

Acquisition Manual

Prepared by the

Division of Right of Way and Access Management

August 2019

 
TABLE OF CONTENTS 
Section 1  Introduction ........................................................................ 1 
1  Purpose and Use ...................................................................................................... 1 
2  Manual Revisions and Updates ................................................................................... 1 
3  Authority and Oversight ............................................................................................ 2 
3.1  Operating Authority .................................................................................... 2 
3.2  Oversight of the Right of Way Process ........................................................... 2 
3.3  Right of Way & Access Management Division’s Right of Way Functions .............. 3 
3.4  Conflict of Interest ..................................................................................... 4 
3.5  Counsel..................................................................................................... 5 
4  Definitions ............................................................................................................... 5 
5  Early and Advance Acquisition.................................................................................. 12 
6  Initial Project Responsibilities................................................................................... 12 
6.1  Preliminary Engineering ............................................................................ 12 
6.2  Transmittal of Project to District Office ........................................................ 12 
6.3  Initial District Activities. ............................................................................ 13 
7  Parcel Records ....................................................................................................... 14 
Section 2  Appraisal and Review ......................................................... 15 
1  Valuation Overview ................................................................................................ 15 
1.1  Regulation of Valuation Function ................................................................ 15 
1.2  Organization Overview for Valuation ........................................................... 16 
2  Project Valuation Responsibilities ............................................................................. 17 
2.1  Project Acquisition Phase ........................................................................... 18 
2.2  Submitting Consultant Order Requests ........................................................ 22 
2.3  Report Delivery ........................................................................................ 22 
2.4  Report Review ......................................................................................... 23 
2.5  Processing Consultant Payment Requests .................................................... 23 
2.6  Project Assigned to a Full Service Right of Way Consultant ............................ 23 
2.7  Registration of Case ................................................................................. 24 
2.8  Pre Condemnation Revisions and Report Updates ......................................... 24 
2.9  Pre Condemnation Update Offer of Just Compensation .................................. 25 
2.10  Post Condemnation Update Requests .......................................................... 25 
2.11  Miscellaneous Valuation and NRE Service Requests ....................................... 26 
2.12  Reports to be provided to the Property Owner .............................................. 26 
2.13  Presentation of ADV Offer to Owners/Agents ................................................ 26 
2.14  Owner’s Request for an Appraisal (ADV Cases) ............................................ 26 
2.15  Interagency Administrative Determinations of Value ..................................... 26 
2.16  Administrative Determinations of Value in Condemnation .............................. 27 
2.17  Appraising Green Acres, Farmland and Conservation Restrictions ................... 27 
2.18  Appraisals required per parcel .................................................................... 27 
2.19  Appraisals for Dedications and Donations .................................................... 27 
3  Valuation Management ........................................................................................... 28 
3.1  Consultant Pre-qualification List ................................................................. 28 
3.2  Consultant Eligibility for Pre-qualification List ............................................... 28 
3.3  Review of Prequalified Consultant List ......................................................... 29 
3.4  Consultant Fee Guidance ........................................................................... 29 
3.5  Additional Division Staff Functions .............................................................. 29 
4  Quality Control ....................................................................................................... 30 
5  General Valuation and NRE Background Information ................................................... 30 

 
5.1  Date of Valuation & Date of Report ............................................................. 31 
5.2  Benefits Resulting from a Project ................................................................ 32 
5.3  Fixtures/Personalty & Functional Unit Items ................................................. 32 
5.4  Highest and Best Use and Fair Market Value ................................................ 32 
5.5  Compensability of Damages ....................................................................... 33 
5.6  Business Losses ....................................................................................... 36 
5.7  Changes in Grade ..................................................................................... 37 
5.8  Drainage ................................................................................................. 37 
5.9  Noise ...................................................................................................... 37 
5.10  Landscaping / Crops and Sand Deposits ...................................................... 37 
5.11  Visibility .................................................................................................. 38 
5.12  Limits of Grading ...................................................................................... 38 
5.13  Easements in General ............................................................................... 38 
5.14  Encroachments ........................................................................................ 39 
5.15  Environmental Conditions (Other Than Contamination) and Valuation ............. 40 
5.16  Contaminated Property and Valuation ......................................................... 40 
5.17  Mitigation of Severance Damages / Replacement Property ............................. 40 
5.18  Tidelands ................................................................................................ 41 
5.19  Green Acres and Farmland and Conservation Restricted Lands ....................... 41 
5.20  Verification of Comparable Sales, Competent Knowledge Required ................. 41 
6  Appraisal Requirements and Standards ..................................................................... 41 
6.1  Appraiser Qualifications ............................................................................. 41 
6.2  Information to be Furnished to Appraisers ................................................... 42 
6.3  Submission and Review of Appraisal ........................................................... 43 
6.4  Delivery and Review of Appraisal Addenda................................................... 43 
6.5  Appraisal Testimony ................................................................................. 43 
6.6  Ethical Standards Regarding Valuation Services ........................................... 43 
6.7  Ownership of Report ................................................................................. 44 
6.8  Report Corrections, Revisions, and Additions ............................................... 44 
6.9  Regulatory Requirements and Standards for Valuation Reports ...................... 44 
6.10  General Appraisal Standards ...................................................................... 47 
6.11  Appraisal Report Documentation ................................................................ 50 
7  Non Real Estate Report (NRE) Standards NJDOT Use of NRE Services ........................... 52 
7.1  NRE Valuation Reports .............................................................................. 52 
7.2  NRE Mitigation Reports ............................................................................. 52 
7.3  NRE Consultant Qualifications .................................................................... 54 
7.4  NRE Testimony ........................................................................................ 54 
7.5  Ethical Standards of Service for NRE Providers ............................................. 54 
7.6  Information to be furnished to NRE Specialists ............................................. 54 
7.7  Maps & Map Errors or Omissions ................................................................ 54 
7.8  Ownership of Reports ............................................................................... 55 
7.9  Report Corrections, Revisions, and Additions ............................................... 55 
7.10  NRE Report General Standards ................................................................... 55 
7.11  NRE Report Format ................................................................................... 56 
8  Administrative Determinations of Value ..................................................................... 56 
8.1  Ethical Standards of Service for ADV Provider .............................................. 56 
8.2  Ownership of Report ................................................................................. 56 
8.3  Report Corrections, Revisions, and Additions ............................................... 56 
8.4  Applicability ............................................................................................. 57 
8.5  Preparation of Administrative Determinations of Value .................................. 57 
8.6  Scope of Administrative Determinations of Value .......................................... 57 
8.7  Level of Documentation for ADV ................................................................. 57 
9  Standing Crop Valuations ........................................................................................ 57 

 
10  Appraisal Review .................................................................................................... 58 
10.1  Standards ............................................................................................... 58 
10.2  Review Requirements ............................................................................... 58 
10.3  Review Functions ..................................................................................... 58 
10.4  Review Appraiser’s Delegated Authority ...................................................... 61 
10.5  Registration & Re-Registration of the Estimated Just Compensation ................ 61 
10.6  Ethical Standards of Service for Appraisal Review Providers ........................... 62 
10.7  Ownership of Report ................................................................................. 62 
10.8  Appraisal Review Report Corrections, Revisions, and Additions ....................... 62 
11  Sample Report Formats ........................................................................................... 62 
Section 3  Negotiations ...................................................................... 63 
1  General ................................................................................................................. 63 
2  Assignment of Negotiations ..................................................................................... 63 
3  Realty Specialist Pre-Negotiations Activities ............................................................... 64 
4  Negotiations with the Property Owner ....................................................................... 65 
5  Special Negotiations ............................................................................................... 68 
6  Realty Specialist’s Case Summary (call data) ............................................................. 69 
7  Realty Specialist Responsibility/Authority .................................................................. 70 
8  Administrative/Legal Settlements ............................................................................. 70 
9  Standing Crop Payment Procedure ............................................................................ 71 
10  Cemetery Property ................................................................................................. 72 
11  Leases .................................................................................................................. 72 
12  District Preparation of the Case for Agreement/Condemnation ..................................... 72 
13  Processing of Case by Headquarters Technical Support ............................................... 74 
14  Quality Control ....................................................................................................... 75 
Section 4  Relocation & Property Management ................................... 76 
1  Introduction .......................................................................................................... 76 
1.1  General Requirements .............................................................................. 76 
1.2  Public Information .................................................................................... 77 
1.3  Relocation Brochure.................................................................................. 77 
1.4  Relocation Information for Owner/Tenant Occupants ..................................... 77 
1.5  Tracing Relocatees ................................................................................... 78 
2  Relocation Planning ................................................................................................ 78 
2.1  Individual Relocation Plan .......................................................................... 79 
2.2  Locating a Satisfactory Unit ....................................................................... 79 
2.3  Civil Rights .............................................................................................. 79 
2.4  Relocation Housing/Business Summary and Lead Time Analysis ..................... 79 
2.5  Local Site Office ....................................................................................... 79 
2.6  Preparation of the Workable Relocation Assistance Plan ................................. 80 
3  Temporary Displacement ......................................................................................... 81 
4  Relocation Advisory Services ................................................................................... 82 
4.1  Initial Personal Contact ............................................................................. 82 
4.2  Relocation Call Data ................................................................................. 83 
4.3  Relocation Records ................................................................................... 83 
4.4  Annual Federal Reports ............................................................................. 84 
5  Status of a Displacee in the United States ................................................................. 84 
6  Department of Labor Mine Safety Act ........................................................................ 85 

 
7  Residential Relocations ........................................................................................... 86 
7.1  Special Replacement Housing Needs ........................................................... 86 
7.2  Estimating and Developing Housing Resources ............................................. 86 
7.3  Replacement Housing of Last Resort ........................................................... 86 
7.4  Residential Relocation Services to be Provided ............................................. 87 
7.5  Comparable Replacement Dwelling Determination ........................................ 87 
7.6  Functional Dwelling Replacement Determination .......................................... 88 
7.7  Public Housing ......................................................................................... 89 
7.8  Residential Specific Relocation Definitions ................................................... 90 
7.9  General Residential Information Notices ...................................................... 90 
7.10  Inspection of Relocation Housing ................................................................ 91 
7.11  Action to Correct Substandard Units ........................................................... 91 
7.12  90-Day Notices and Subsequent 30-Day Notices .......................................... 91 
7.13  Emergency Relocations ............................................................................. 91 
8  Department Actions ................................................................................................ 92 
9  Replacement Housing Payments for 90-Day Occupants ............................................... 92 
9.1  Owner Occupant Eligibility ......................................................................... 92 
9.2  Amount of Payment .................................................................................. 92 
9.3  Computation of Price Differential ................................................................ 93 
9.4  Determining the Cost of a Comparable Replacement Dwelling ........................ 93 
9.5  Offering the Replacement Housing Payment ................................................ 94 
9.6  Special Situations ..................................................................................... 94 
9.7  Limitations on Payment ............................................................................. 95 
9.8  Application for Payment ............................................................................ 96 
9.9  Preparation of Housing Supplements .......................................................... 96 
9.10  Updating of Housing Supplement ............................................................... 96 
9.11  Multiple Occupancy of the Same Dwelling Unit ............................................. 97 
9.12  Administrative Settlements ........................................................................ 97 
10  Mortgage Costs/Incidental Expenses ......................................................................... 97 
10.1  Application For Mortgage Interest and Incidental Expense Payment ................ 98 
10.2  Incidental Expenses .................................................................................. 98 
11  Replacement Housing Payments For Less Than 90-Day Occupants ................................ 99 
11.1  Rental Assistance Payment ........................................................................ 99 
11.2  Base Monthly Rental for Subject Dwelling .................................................... 99 
12  Manner of Disbursement And Documentation Required ............................................. 100 
13  Down Payment Assistance Payment ........................................................................ 101 
14  Offer of Replacement Housing Supplement .............................................................. 101 
15  Replacement Housing For Subsequent Occupants ..................................................... 101 
16  General Requirements: Housing Supplements .......................................................... 102 
16.1  Purchase of Replacement Dwelling............................................................ 102 
16.2  Occupancy Requirements ........................................................................ 103 
16.3  Conversion of Payment ........................................................................... 103 
17  Payment After Death ............................................................................................ 103 
18  Claims for Relocation Payments ............................................................................. 103 
18.1  Time for Filing Relocation Claims .............................................................. 104 
18.2  Deductions from Relocation Payments....................................................... 104 
18.3  Notice of Denial of Claim ......................................................................... 104 
19  Residential Moving Payments ................................................................................. 104 
19.1  Residential Room Count Moving Payments ................................................. 105 
19.2  Actual Moving and Related Expenses ........................................................ 105 

 
19.3  Multiple Family Provisions........................................................................ 105 
19.4  Costs of Transportation ........................................................................... 106 
19.5  Moves of Personal Property Only (Dwelling Not Displaced) ........................... 106 
20  Commercial, Farm & Non Profit Relocation ............................................................... 106 
20.1  Overview............................................................................................... 106 
20.2  Commercial Moving Payments .................................................................. 107 
20.3  Ineligible Business Moving and Related Expenses ....................................... 109 
20.4  Notification and Inspection ...................................................................... 110 
20.5  Fixed Payment-Commercial Occupants ...................................................... 110 
20.6  Farms-Fixed Payment ............................................................................. 110 
20.7  Non Profit Organizations-Fixed Payment .................................................... 111 
20.8  Average Annual Net Earnings - Business or Farm ....................................... 111 
20.9  Processing Applications for In-Lieu Payment .............................................. 112 
20.10  Competitive Moving Estimates (Commercial Moves) .................................... 112 
20.11  Estimate Format .................................................................................... 112 
20.12  Inventory of Personal Property ................................................................. 113 
20.13  Tips on Performing an Inventory .............................................................. 113 
20.14  Monitoring the Move ............................................................................... 114 
20.15  Moving Payment Approval ....................................................................... 114 
20.16  Self Moves ............................................................................................ 115 
20.17  Expense Finding (Commercial or Residential Personal Property) ................... 115 
20.18  Reestablishment Expenses And Related Eligible Expenses ............................ 116 
20.18.1  Nonresidential Reestablishment Expenses ................................. 116 
20.18.2  Ineligible Reestablishment Expenses ........................................ 116 
21  Underground Storage Tanks on Acquired Property .................................................... 116 
21.1  Decommissioning of Underground Tanks ................................................... 117 
21.2  Decommissioning Process ........................................................................ 118 
22  Advertising Signs ................................................................................................. 118 
22.1  Policy .................................................................................................... 118 
22.2  Sign Relocation Process .......................................................................... 119 
23  Mobile Homes ...................................................................................................... 120 
23.1  Moving Expenses .................................................................................... 120 
23.2  Replacement Housing Payment - 90-Day Mobile Home Owner Occupant ........ 120 
23.3  Replacement Housing Payments - 90-Day Mobile Home Tenant .................... 121 
23.4  Replacement Housing Payment Based on Mobile Home and Site ................... 121 
23.5  Comparable Replacement Dwelling ........................................................... 121 
23.6  Mobile Home Relocation .......................................................................... 121 
23.7  Partial Acquisition of a Mobile Home Park .................................................. 122 
24  Last Resort Housing .............................................................................................. 122 
25  Transient Occupants of NJDOT land ........................................................................ 122 
26  Relocation Appeal Process ..................................................................................... 122 
27  Leasing ............................................................................................................... 122 
27.1  Establishment of Rental for Leases in Connection with “Active Projects” ........ 122 
27.2  Rental to Public Agencies or Persons Not Displaced ..................................... 123 
27.3  Protective Leasing .................................................................................. 123 
27.4  Lease Agreements for hold over tenant ..................................................... 124 
27.5  Starting Date of Rent .............................................................................. 124 
27.6  Lease Approval Process in connection with “active projects”......................... 124 
27.7  Receipt and Posting Rentals Collected ....................................................... 125 
27.8  Rental Deposits and Mailing of Receipts of Payment Received ...................... 125 
27.9  Delinquent Rentals ................................................................................. 126 
27.10  Rental Eviction Policy .............................................................................. 126 

 
27.11  Statutory Requirements for Property Leasing ............................................. 127 
27.12  Maintenance of Leased Property ............................................................... 127 
27.13  Management of Multiple Unit Leased Properties .......................................... 128 
27.14  Registration of Leasehold Information ....................................................... 128 
27.15  Real Estate Taxes and the Payment of the In Lieu of Municipal Services ........ 129 
28  Taking Possession of Property ................................................................................ 131 
28.1  Possession Certificate Distribution ............................................................ 131 
28.2  Pre Construction and Transfer of Keys & Documents ................................... 131 
28.3  Asbestos & Demolition for Properties that are Improved and Acquired ........... 131 
28.4  Utility Removal for Acquired Buildings ....................................................... 133 
29  Eviction Activities, ................................................................................................ 134 
30  Retention of Realty by Owner ................................................................................ 135 
31  Property Management ........................................................................................... 135 
31.1  Inventory .............................................................................................. 137 
31.2  Departmental Clearance of Excess Lands Process ....................................... 137 
31.3  Surplus Property .................................................................................... 144 
31.4  Excess Land .......................................................................................... 144 
31.5  Excess Land File ..................................................................................... 144 
31.6  Statutes and Regulations Related to Excess Land ....................................... 145 
31.7  Public Auctions and Excess Land .............................................................. 148 
31.8  Public Auction Process............................................................................. 150 
31.9  Conduct of In Person Auction ................................................................... 150 
31.10  Forfeiture of Deposits on Excess Land Contracts ......................................... 151 
32  Handling of Cash .................................................................................................. 152 
33  Property Leasing .................................................................................................. 152 
33.1  Property Leasing Prior to Construction ...................................................... 154 
33.2  Property Leasing After Construction .......................................................... 154 
34  Public Auctions for Buildings and Excess Land .......................................................... 156 
35  Encroachments .................................................................................................... 157 
36  Functional Replacement of Real Property ................................................................. 157 
37  Quality Control ..................................................................................................... 161 
38  Processing of Relocation Payments ......................................................................... 162 
Section 5  Title Closing ..................................................................... 164 
1  General ............................................................................................................... 164 
1.1  Introduction .......................................................................................... 164 
1.2  Purpose ................................................................................................ 164 
1.3  Requirements ........................................................................................ 164 
1.4  Section Responsibilities ........................................................................... 164 
1.5  Section Organization............................................................................... 165 
2  Title Processing .................................................................................................... 165 
2.1  Procedures ............................................................................................ 165 
3  Field Searching .................................................................................................... 166 
3.1  Requirements ........................................................................................ 166 
3.2  Responsibility ........................................................................................ 166 
3.3  Procedures ............................................................................................ 166 
3.4  Minimum Search Requirements ................................................................ 167 
3.5  Creating a Chain of Title .......................................................................... 167 
3.6  Riparian Parcels ..................................................................................... 168 
3.7  Plotting ................................................................................................. 168 

 
3.8  Searching the Indices ............................................................................. 169 
3.9  Searching for Liens ................................................................................. 169 
3.10  Searcher’s Title Report ............................................................................ 170 
3.11  Assemblage of the Chain of Title .............................................................. 170 
3.12  Continuations ........................................................................................ 170 
4  Title Examining .................................................................................................... 171 
4.1  Requirements ........................................................................................ 171 
4.2  Responsibility ........................................................................................ 171 
4.3  Procedures ............................................................................................ 171 
4.4  Reading a Title ....................................................................................... 171 
4.5  Preparing the Report of Title .................................................................... 172 
5  Condemnation ..................................................................................................... 174 
5.1  Requirements ........................................................................................ 174 
5.2  Responsibility ........................................................................................ 174 
5.3  Procedures ............................................................................................ 174 
5.4  Preparing the Title memorandum ............................................................. 175 
5.5  Updating Title to Cover Lis Pendens – Declaration of Taking ......................... 175 
5.6  Processing Awards and Judgments ........................................................... 176 
5.7  Processing Awards or Judgments to be Paid Into Court ............................... 178 
5.8  Award or Judgments that are the same as the Deposit Under a Declaration of 
Taking  178 
5.9  Case Closure ......................................................................................... 178 
6  Agreement Processing and Settlements ................................................................... 179 
6.1  Requirements ........................................................................................ 179 
6.2  Responsibility ........................................................................................ 179 
6.3  Incidental Closing Costs .......................................................................... 179 
6.4  Procedures for Processing Agreement Cases .............................................. 179 
6.5  Notice to Tax Assessor ............................................................................ 181 
6.6  Preparing the Assembly Package for Final Review ....................................... 182 
6.7  Agreements Providing For Exchange Of Excess Lands As Part Consideration ... 182 
6.8  Down Payment Checks ............................................................................ 182 
7  Settling Cases ...................................................................................................... 183 
7.1  Requirements ........................................................................................ 183 
7.2  Responsibility ........................................................................................ 183 
7.3  Procedures ............................................................................................ 183 
7.4  Invoicing/Check Process .......................................................................... 184 
7.5  Follow-Ups and Cancellation of Checks ...................................................... 185 
8  Local Aid Projects/Developer Agreements ................................................................ 186 
8.1  Requirements ........................................................................................ 186 
8.2  Responsibility ........................................................................................ 186 
9  Title Company Liaison ........................................................................................... 186 
9.1  Introduction .......................................................................................... 186 
9.2  Requirements ........................................................................................ 187 
9.3  Responsibility ........................................................................................ 187 
9.4  Title Company Outsourcing Process .......................................................... 187 
9.5  Procedures ............................................................................................ 190 
9.6  Agreement Cases ................................................................................... 190 
9.7  Notice to Tax Assessor ............................................................................ 190 
9.8  Preparing the Certificate of Title ............................................................... 191 
9.9  Check Coding Procedures and Settling Cases ............................................. 191 
9.10  Agreements Providing for Exchange of Excess Lands as Part Consideration .... 192 
9.11  Processing Awards or Judgments .............................................................. 192 

 
9.12  Notice for Reimbursement of Incidental Costs ............................................ 192 
9.13  Title Company Payments ......................................................................... 193 
10  Records And Control ............................................................................................. 193 
10.1  Requirements ........................................................................................ 193 
10.2  Responsibility ........................................................................................ 193 
10.3  Procedures ............................................................................................ 193 
10.4  Database Entries .................................................................................... 193 
10.5  Recording Instruments ............................................................................ 194 
10.6  Notice to Tax Assessor ............................................................................ 195 
10.7  Tax Search Requests .............................................................................. 195 
10.8  Records of State Departments ................................................................. 195 
10.9  Acquisition Log ...................................................................................... 195 
10.10  Excess Parcel Conveyance Log ................................................................. 196 
10.11  Filing Case Folders ................................................................................. 196 
10.12  Active Files ............................................................................................ 196 
10.13  Storage Files ......................................................................................... 196 
10.14  Processing Cases for Storage ................................................................... 196 
11  Reimbursement of Taxes ....................................................................................... 197 
11.1  Requirements ........................................................................................ 197 
11.2  Responsibility ........................................................................................ 197 
11.3  Procedures for Tax Payments ................................................................... 197 
11.4  Payment or Reimbursement for Incidental Closing Costs ............................. 199 
12  Excess Land Sales ................................................................................................ 199 
13  Dedications ......................................................................................................... 200 
13.1  Responsibility ........................................................................................ 200 
13.2  Procedures ............................................................................................ 200 
14  Deed Notices ....................................................................................................... 201 
Section 6  Right Of Way Administration ............................................ 202 
1  General ............................................................................................................... 202 
2  Preliminary Engineering Activities ........................................................................... 202 
3  Right of Way Project Programming Process .............................................................. 202 
3.1  Access Modification/Revocation ................................................................ 203 
3.2  Right of Way Plans and Documents Package .............................................. 203 
4  Phase Review ...................................................................................................... 203 
5  Data Entry ........................................................................................................... 204 
6  Project Funding .................................................................................................... 204 
6.1  Funding ................................................................................................ 204 
6.2  Authorization Process ............................................................................. 205 
7  Transmittal of Project to District Office .................................................................... 205 
7.1  Process ................................................................................................. 205 
7.2  Content of Transmittal ............................................................................ 205 
8  Final Right of Way Package Distribution................................................................... 205 
9  Holds / Revisions / Eliminations ............................................................................. 206 
9.1  Revisions to Parcel Design ....................................................................... 206 
9.2  Distribution of Revised Plans / Agreement Forms ........................................ 206 
10  Advance Acquisition and Early Acquisition of Rights of Way ....................................... 206 
10.1  Regulations ........................................................................................... 206 
10.2  Advance Acquisition Process .................................................................... 207 
10.3  Early Acquisition .................................................................................... 207 

 
10.4  Early Acquisition Process ......................................................................... 208 
11  Right of Way Statements, Certifications and Clearances ............................................ 208 
12  Dedications/ Donations ......................................................................................... 209 
13  Final Vouchering A Project ..................................................................................... 210 
14  Suspense ............................................................................................................ 210 
15  Administrative Functions ....................................................................................... 211 
16  Local Public Agency Projects .................................................................................. 211 
Section 7  Legal Processing .............................................................. 212 
1  Organization/Purpose ........................................................................................... 212 
2  Case Assignment .................................................................................................. 212 
3  Tracking Progress And Status Of Cases Via The Right Of Way Database ...................... 213 
4  Case Processing ................................................................................................... 213 
4.1  Upon Receipt of a Case Assignment, the Research Analyst shall: .................. 213 
4.2  Caption and Complaint Paragraphs 9 & 10 ................................................. 213 
5  Pleadings ............................................................................................................ 213 
5.1  Forms of Pleadings ................................................................................. 214 
5.2  Filing Pleadings – The Process .................................................................. 216 
6  Amendments ....................................................................................................... 217 
6.1  Complaint ............................................................................................. 217 
6.2  Declaration of Taking .............................................................................. 218 
6.3  Additional Deposits ................................................................................. 218 
6.4  Withdrawals .......................................................................................... 218 
7  Service of Process ................................................................................................ 218 
7.1  Types of Personal Service ........................................................................ 219 
7.2  Substitute Service Methods ..................................................................... 220 
7.3  Lead Time ............................................................................................. 220 
7.4  Publication-Invoice ................................................................................. 220 
8  Litigation Support ................................................................................................. 221 
9  Conclusion of the Case .......................................................................................... 221 
Section 8  Local Public Agency Guidance .......................................... 222 
Addendum Section ............................................................................... 232 
 
 

Section 1 Introduction

1.1 Purpose and Use

This Manual provides direction and guidance to personnel who carry out the New Jersey

Department of Transportation’s (Department) right of way acquisition program. Its

content is applicable to Department staff, right of way consultants and Local Public Agency

personnel who acquire right of way on NJDOT or FHWA funded projects.

The Manual addresses all major right of way functions including valuation, acquisition,

condemnation, relocation, property management. It also covers important Department

right of way administrative processes.

Local Public Agencies should be aware of the required elements in the acquisition process,

and apply them to each of the right of way acquisition functions that they undertake or

contract another entity to undertake on their behalf.

The provisions of this Manual comply with New Jersey and Federal statutes and

regulations. The Federal Highway Administration (FHWA) has reviewed and accepted the

Manual as meeting the requirement (23 CFR 710.201) that each State DOT maintain a

Manual that describes its policies and practices for all phases of the right of way program.

The Manual is an authoritative guide, which may reference other Department Manuals or

authorities and includes references to forms and other materials and guidance that can be

accessed electronically. Guidance documents may illustrate a typical procedure that does

not need to be part of the manual. The manual addresses all State and Federal

requirements for executing the right of way program. Staff and consultants who work

under its scope are required to comply with its provisions. However, the Department

recognizes that projects sometimes present situations that cannot be anticipated or

addressed in formal policy. Complex or unique cases involving acquisition, relocation or

other phases should be considered individually. Right of Way staff will inform the Project

Manager and other leadership officials about special situations as soon as they are

identified. This will enable prompt decisions to resolve issues. LPAs with issues may

contact the Right of Way & Access Management Division Technical Support Bureau.

The Director of the Right of Way & Access Management Division is authorized to interpret,

clarify or approve exceptions to provisions of the Manual. This may be done where

application of policy as written might be misunderstood or have an unintended effect when

applied to special situations. All interpretations, clarifications and exceptions must comply

with requirements of State or Federal laws or regulations, meet the intent of this Manual

and be fair to all parties.

1.2 Manual Revisions and Updates

This Manual will be updated as necessary to conform to changes in law, regulations and

Department organization as these events occur. It will also be revised to incorporate better

practices identified through Quality Control/Quality Assurance (QC/QA) activities. The

Department will certify to the FHWA every five years that the Manual conforms to existing

practices and that procedures comply with Federal and State laws and regulations.

Each person using the Manual has a responsibility to contribute to its improvement. Users

are invited to make suggestions, supported by an explanation of the reasoning for the

change, to the Director of the Right of Way & Access Management Division or to Right of

Way & Access Management Division Bureau managers or their immediate supervisor.

All substantive changes to any form, letter, other documents, process, procedure or formal

activities, must be submitted through the Manager, Technical Support Bureau. This

requirement includes any modifications to documents on the Intranet, PAECETrak

(database) system or the ROW Manual.

1.3 Authority and Oversight

1.3.1 Operating Authority

The NJDOT is authorized by N.J.S.A. 27:7-22 et seq. to acquire lands or rights therein by

gift, devise or purchase. It is also authorized to undertake condemnation in the manner

provided in the Eminent Domain Act of 1971 N.J.S.A. 20:3-1 et seq. The NJDOT is also

subject to the requirements set forth in the Federal Uniform Relocation Assistance and

Real Property Acquisition Policies Act of 1970 (URA), as amended [42 U.S.C. §4601 et

seq.] and the attendant regulations as set forth in 49 CFR 24. State law provides

authorization allowing NJDOT to utilize federal relocation standards to the extent that they

exceed state relocation [Relocation Assistance Law of 1967 (N.J.S.A. 52:31B-1 et seq.)

and the Relocation Assistance Act of 1971 (N.J.S.A. 20:4-1 et seq.) The NJDOT is

authorized under an FHWA Programmatic Waiver to use Administrative Determinations of

Value (ADV) (defined in federal regulations as a Waiver Valuation) where the estimated

compensation is $25,000 or less in order to set what it believes to be just compensation

as referenced in 49 CFR 24.2(a)(33) and 24.102(c)(2). Local public agencies using an

ADV are subject to a $10,000 upper limit of value.

The Department, and all public agencies are also bound by the 5th Amendment of the US

Constitution and by Article 1, Clause 20 of the New Jersey Constitution to provide payment

for property and interests in property that are acquired through eminent domain by them.

1.3.2 Oversight of the Right of Way Process

Whenever any FHWA funding is used in a project (even if not used for right of way

acquisitions) the FHWA exercises full oversight of the right of way acquisition process. The

level of oversight exercised by FHWA for any particular project or activity is defined in the

current FHWA / NJDOT Stewardship and Oversight Agreement. Both NJDOT and the Local

Public Agencies are required to use the federal relocation standards. In the event that a

New Jersey statute mandates a specific relocation benefit dollar amount, which exceeds

the federal amounts provided, the legislatively mandated state benefit will be substituted,

and to the extent approved by FHWA, it will be reimbursable by federal funding. It is the

responsibility of the Manager, Bureau of Technical Support to provide a yearly report to

the FHWA in accordance with Appendix B, 49 CFR Part 24. This report will be compiled

by the Technical Support Bureau and submitted to the FHWA as required.

Local Public Agencies utilizing this manual should make note of processes that would be

applicable to their acquisition process even though this manual may refer to a specific

Division unit doing that task. Common sense should be employed in recognizing the

necessary steps, even if the Local Public Agency is not specifically identified.

NJDOT entered into an agreement with FHWA to provide stewardship and oversight of the

right of way program. Stewardship includes the efficient and effective management of

public funds. Oversight includes complying with applicable State and Federal laws,

policies, and regulations.

As part of its stewardship obligations, NJDOT through the Division of Right of Way & Access

Management is responsible for oversight of the right of way acquisition process when FHWA

funds are provided to NJDOT or to Local Public Agencies and other state agencies through

NJDOT. This oversight is to ensure that the acquisition process (appraisals, negotiations,

condemnation and relocations) are carried out in accordance with the FHWA requirements

and federal and sate statutes and regulations that govern the use of such funds.

 Federal participation in real property acquisition cost is limited to costs associated

with property incorporated into the final project and the direct costs associated with

real property acquisition required under the laws of New Jersey. See 1.5

The Division of Right of Way & Access Management is also responsible for oversight of the

right of way acquisition process undertaken by a Local Public Agency, which receives state

or federal funds provided by NJDOT. Details of the FHWA approved oversight process are

available in Section 6.16.

Where a Local Public Agency purchases land for a project using NJDOT or FHWA funds,

those lands in excess of the area needed for the right of way shall be conveyed to NJDOT

as a partial refund of the funding provided, unless otherwise provided.

1.3.3 Right of Way & Access Management Division’s Right of Way Functions

The Division of Right of Way and Access Management right of way functions are

decentralized, with a Northern and Southern District Office and a central Headquarters.

 The District Offices are comprised of project teams, with each team being charged

with the responsibility for the completion of the appraisal/appraisal review,

negotiations and relocation functions for assigned projects as well as other project

planning activities.

 The Headquarters’ office is comprised of the Office of the Director, and the Technical

Support and Closing Bureaus.

 The Director’s office provides oversight and planning for the Division.

 The Technical Support Bureau is responsible for project coordination through

PAECETrak, appraisal contracts, audit of district operations, quality control, property

management, oversight of relocation operations and provision of technical guidance

to district offices. It also is responsible for the programming/funding of right of way

projects including the final vouchering of closed projects.

 The Closing Bureau is comprised of the Title Section, which is responsible for title

searches, agreement processing and closing of title. The Legal Processing Section

has responsibility for the preparation of the legal pleadings necessary to accomplish

the condemnation process.

Documentation produced by the Division’s activities is addressed mainly through the

PAECETrak system, which is intended to be a digital repository of the documents created

by the Division. For the purpose of determining which documents are to be uploaded into

the database system, the Districts, and Headquarters units are responsible to upload all

documents related to their activities that are completed within that unit and which involve

contact with the owner; spending of money; appraisals, appraisal reviews and NRE reports;

authorization of a decision by the Division, call data, letters and documents to and from

outside persons and entities, agreements, deeds and title research, and all other

documents or correspondence that are necessary for understanding the case. The

Technical Support Bureau will scan and input those documents from the Districts that are

approved by the Director after submission to HQ such as agreements and RE-27

documents and the Closing Bureau will upload copies of finalized deeds and legal case

materials generated by that Bureau.

Prior to a unit completing its work on a case such as a District submitting a case for

agreement or condemnation or final closing of the case by Closing, the supervisor of that

case in each unit performing work will verify and note in the PAECETrak database that all

required documents as noted above were uploaded into the PAECETrak database before

submission or closure of the case file.

1.3.4 Conflict of Interest

A. As set forth in the New Jersey Uniform Code of Ethics, “No State officer or employee or

special State officer or employee should have any interest, financial or otherwise, direct

or indirect, or engage in any business or transaction or professional activity, which is

in substantial conflict with the proper discharge of his/her duties in the public interest.”

“No special State officer or employee, nor any partnership, firm or corporation in which

he/she has an interest, nor any partner, officer or employee of any such partnership,

firm or corporation, shall represent, appear for, or negotiate on behalf of, or agree to

represent, appear for or negotiate on behalf of, any person or party other than the

State in connection with any cause, proceeding, application or other matter pending

before the particular office, bureau, board, council, commission, authority, agency, fund

or system in which such special State officer or employee holds office or employment.”

B. If an employee of the Department is the owner of property required for a project, it is

the policy of the Department to complete the appraisal and review of appraisal of the

property using only independent appraisal consultants. All property owner inquiries or

questions prior to registration of the property value shall be coordinated through the

Attorney General’s Office. When the property value is registered, the Department’s file

shall be transferred to the Attorney General’s Office. The Department's offer of

compensation for the required property shall be made through the Attorney General's

office and an acceptance of that offer or any subsequent questions that the owner may

have shall be made through the Attorney General's Office. It is also the policy of the

Department that after appraising the owner’s property and making its fair market value

offer to the owner, the Department will initiate condemnation to allow the

Commissioners, and if necessary the court, to establish the amount of just

compensation due that person, if the fair market value offer is not accepted by the

owner. The Attorney General’s Office will appoint two Deputy Attorneys General; one

to address any questions that the owner may have and one to present the case, if

necessary, before the Commissioners and/or Court.

C. It is the policy of the Department that no employee shall accept any gift or other thing

of value from any firm, organization, association or individual doing business with the

Department, or those that could reasonably be expected to do business with the

Department.

D. Every appraisal report, offer, counteroffer and settlement is a confidential matter

between the owner and the realty specialist (negotiator) and such information shall not

be shared with other owners on the project. This information is also not available

through the Open Public Records Act until after the Project is completed.

E. Under no circumstances will the same person that appraised, reviewed or prepared an

Administrative Determination of Value negotiate with the property owner.

1.3.5 Counsel

 Legal counsel for the Division is available from the Division of Law, Transportation,

Condemnation and Contract Section, during the planning, design and bona fide

negotiations phases of the acquisition process, as well as during post complaint

settlement discussions. Project Realty Specialist 4s and their staff are strongly

encouraged to avail themselves of this resource. A Deputy Attorney General (DAG) or

the local agency’s attorney may be a useful resource for detecting complex valuation

pitfalls which can be avoided or minimized during the appraisal process and should be

called upon for advice on the law on benefits, before value/after value appraisals and

the compensability of particular items.

 In complex cases, a DAG should be afforded the opportunity to participate in the realty

specialist’s pre complaint negotiations meetings with the owner or owner’s counsel and

to provide input into the decision to initiate the condemnation process. Questions

regarding changes in design are not an appropriate topic for legal advice.

A Local Public Agency (LPA) attempting project acquisitions and relocations is strongly

advised to consult with qualified legal counsel familiar with eminent domain issues. The

use of full service Right of Way Consultants may also be appropriate. The LPA may seek

assistance with technical questions through the Bureau of Technical Support.

1.4 Definitions

Access: Any rights the owner may or may not have to place or keep a driveway opening

onto a road at a specific location. Generally, access rights are a separate issue from

condemnation and regulation of driveways represent an administrative exercise of the

State’s police powers. Any questions regarding this issue need to be discussed promptly

to avoid incorrect conclusions and delays. For State highways and their associated

approaches, the Office of Access Design in the Division of Right of Way and Access

Management implements the Highway Access Management Act. Local Public Agencies may

have their own access process to address driveways on local roads.

Acquisition of Property: The Department may acquire property in a number of ways.

Except for donations and dedications, the other methods of property transfer are normally

bought under authority of the Eminent Domain statute. Unless otherwise specified, each

is subject to all acquisition and relocation requirements set forth in this manual.

1. Standard Acquisition: Property acquired during the normal course of a project after

environmental reviews are complete.

2. Early Acquisition: Consists of purchase of most or all needed right of way on a

project prior to environmental review being completed.

3. Advance Acquisition: Consists of purchases of a limited number of parcels for

hardship claims or protective buying on a proposed project prior to completion of

the environmental review.

4. Dedication: Land conveyed to NJDOT to fulfill a regulatory requirement for receiving

an Access Permit. This land is conveyed as part of a police power and not eminent

domain, and is not subject to 23 CFR 710.505.

5. Donation. Land donated to NJDOT as a voluntary act by an owner. Where a

donation is part of a project, it is subject to 23 CFR 710.505, Where the donation

is a voluntary transfer at the request of an owner and NOT part of any active project

the donation is not subject to that regulation.

Administrative Determination of Value (ADV): The term Administrative

Determination of Value is NJDOT equivalent of the FHWA term “waiver valuation” and

refers to the valuation process used and the product produced when the Agency

determines that an appraisal is not required, pursuant to § 24.102(c)(2).

Appraisal: 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.

Bona Fide Negotiations: The process of conducting negotiations to acquire the rights

or property needed in a manner that is fair to both sides. New Jersey’s Eminent Domain

Act of 1971 requires bona fide negotiations to include a written offer delivered to the owner

of the property to be acquired, which sets forth the property and/or interest to be acquired,

the compensation offered to be paid, and provision of the appraisals, which were used to

establish the offer of compensation.

Business: Any lawful activity, except a farm operation, that is conducted (a) 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; or (b) primarily for the sale of services to the public; or (c) primarily

for outdoor advertising display purposes, when the display must be moved as a result of

the project; or (d) by a nonprofit organization that has established its nonprofit status

under applicable Federal or State law.

Compensable Damages: Those damages to the property for which the owner may be

entitled to compensation. See Sec. 2.5.5. for additional discussion of compensability of

damages. Specific questions regarding compensability should be addressed to the

Technical Support Bureau.

Comparable Replacement Dwelling: A dwelling that is determined to be a suitable

replacement for the displaced person’s former residence, meeting local code and FHWA

requirements. For details, see Sec. 4.3.3.

Decent, Safe and Sanitary Dwelling: A dwelling that meets applicable housing and

occupancy codes, along with the standards set forth by the FHWA.

Displaced Person: Any person who moves from the real property or moves her/his

personal property from the real property as a direct result of a written notice of intent to

acquire, the initiation of negotiations for, or the acquisition of, such real property, in whole

or in part, for a project. 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.

Division: Unless otherwise indicated, the use of the term Division shall refer to the

Division of Right of Way & Access Management, and more particularly to the right of way

functions of the Division.

Donation: Means the voluntary transfer of privately owned real property, by a property

owner who has been informed in writing by the acquiring agency of rights and benefits

available to owners under the Uniform Act and this section, for the benefit of a public

transportation project without compensation or with compensation at less than fair market

value. Source: § 710.105 Definitions. The Commissioner has the authority to accept

donations under Title 27.

Dwelling: 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 non-housekeeping unit; a mobile home; or any other

residential unit.

Easement: An easement is an interest that allows a person or entity the right to occupy

or use, the real property of another person or entity, but does not convey ownership.

Eminent Domain: The inherent power of the state or federal government to acquire

property for a public use. This power is exercised through condemnation. The eminent

domain authority of all New Jersey public agencies is limited by the federal and state

constitutions, court decisions and in New Jersey by the Eminent Domain Act of 1971

N.J.S.A. 20:3-1 et seq. Local Public Agencies may also be subject to other statutory

limitations. When it is not possible to conclude an agreement as a result of bona fide

negotiations, the state or Local Public Agency (“LPA”), where authorized by law, may

institute condemnation proceedings to acquire the property and provide a judicial

determination of just compensation. Although federal funds may be involved in the

project, the acquisition and condemnation authority is based on New Jersey law and

conducted in New Jersey courts. Neither the Department, nor any other New Jersey public

agencies can utilize private property without payment unless the owner waives its right to

compensation. This also applies to contractors working on behalf of the Department or an

LPA.

Encroachment: Using the lands of another property owner or the right of way without

consent. An encroachment can be permanent such as a building or paving or an

intermittent use such as parking cars. (see also Illegal Parking Spaces).

Fair Market Value: "Fair market value" for eminent domain purposes has been defined

by the New Jersey courts as "the value that would be assigned to the acquired property by

knowledgeable parties freely negotiating for its sale under normal market conditions based

on all surrounding circumstances at the time of the taking." State v. Silver, 92 N.J. 507,

513-14 (1983).

In 2003, the New Jersey Supreme Court cited a 2000 Appellate Division decision, in which

"fair market value" was defined as what a willing buyer and a willing seller would agree to

as of the date of the taking, neither being under any compulsion to act. Hous. Auth. of

New Brunswick v. Suydam Investors, 17 N.J. 2 (2003); County of Monmouth v. Hilton, 334

N.J. Super. 582, 587 (App Div. 2000), certif, denied, 167 N.J. 633 (2001).

The Court in Hilton also said that the inquiry [into Fair Market Value] should not be limited

to the actual use of the property on the date of taking but rather based on its highest and

best use.

Farm Operation: 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.

Highest and Best Use: That use of the property which is "1) legally permissible, 2)

physically possible, 3) financially feasible, and 4) maximally productive. Hous. Auth. of

New Brunswick v. Suydam Investors, 23 N.J. 2 (2003) Citing County of Monmouth v.

Hilton, 334 N.J. Super. 582, 587 (App Div. 2000), cert. denied, 167 N.J. 633 (2001). See

Sec. 2.5.4.

Incidental Expenses: Reimbursable expenses include, but are not limited to recording

fees, transfer taxes, costs for prepayment of any preexisting recorded mortgage and a pro

rata share of prepaid property taxes. Attorney fees may qualify for reimbursement only

where those services are directly related to the transfer of title.

Illegal Parking Space: Parking lot space that is physically located in or uses part of the

right of way. Example: Top parking stall has sufficient (20’) clearance to maneuver. Lower

stall maneuvering room crosses part of the diagonal right of way line making it illegal.

Initiation of Negotiations: The delivery of the initial written offer of just compensation,

by the Department to the owner or the owner's representative for the purchase of real

property. For the purpose of relocations, the date of initiation of negotiations for a

relocatee who moves prior to the date of the offer but after the initial notification is the

date of the move. See: 49 CFR 24.2(a)(15)(i) though (iv).

Inspection of Property: Outside of the condemnation authority, the Department may

also conduct limited inspections of property that it plans to acquire through New Jersey

statutory authority under N.J.S.A. 20:3-16.

Just Compensation for a Tenant: Valuation based upon the amount, which the

improvement contributes to the fair market value of the whole property, or its salvage

value, whichever is greater. No payment shall be made directly 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 Department 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.

Last Resort Housing: Federal law specifies limits for residential relocation payments. In

certain instances, those limits may be exceeded as set forth in this manual including for

such reasons as hardship, or income criteria. Last Resort Housing is any amount above

those limits necessary to meet relocation requirements under federal or state regulations

or laws. In the event that last resort housing is invoked, the file must be documented as

to the specific reason for the use of Last Resort Housing. A memo setting forth the

circumstances is sufficient.

Linear Construction Guidance: Remediation standards authorized by the New Jersey

Department of Environmental Protection for work in a linear corridor such as a road or

utility right of way corridor that may be different from or less than standards that a typical

property owner may be subject to.

Local Public Agencies (LPAs): Counties, municipalities and government agencies,

including other State Departments which received funding from the Department and which

must therefore adhere to the procedures, rules and regulations set forth herein in

undertaking the acquisition of property or interests in property.

Mobile Home: Dwellings such as manufactured homes and recreational vehicles used as

residences. Refer to 49 CFR Part 24, Appendix A, § 24.2(a)(17) for additional guidance

pertaining to the use of mobile homes for replacement housing.

Negotiated Purchase: A purchase made without resorting to eminent domain. The

basic tenant of the acquisition process is to make every reasonable effort to expeditiously

acquire real property through bona fide negotiations.

NJDOT: The New Jersey Department of Transportation. When NJDOT is used in this

manual, where applicable, Local Public Agency may be substituted for NJDOT where that

substitution is applicable and does not change NJDOT’s oversight responsibility or

authority.

Nonprofit Organization: An organization that is incorporated as a non-profit

organization under the laws of New Jersey or other State jurisdiction, and is exempt from

payment of Federal income taxes under Section 501 of the Internal Revenue Code (26

U.S.C.501).

Non-Real Estate Reports: Non-Real Estate (NRE) or Specialist reports come in two

varieties. NRE valuation reports cover unique real estate valuation issues such as

machinery cost estimates and valuation of personalty associated with real estate. The

second type of NRE reports are mitigation reports, which are used to mitigate damages,

caused by acquisitions and are also used by the owner in planning and obtaining approvals

for reconstruction or restoration of items damaged by the acquisition. These reports

address the method and cost to mitigate the damaged property elements such as replacing

parking spaces, well and septic systems, building redesign, etc.

Offer Package: An offer to acquire is made to the Owner of Record, and will normally

include the following elements:

 A written offer letter with a statement of the amount offered as just compensation,

including an arbitrary breakdown of the offer into fee, improvements and damages,

an identification of site improvements and any other improvements to be acquired,

including removable building equipment and trade fixtures, which are considered to

be part of the real property to be acquired;

 A copy of the appraisal(s) and other reports used in setting the fair market value

offer.

 Copies of the maps and descriptions of the real property and the property interest

to be acquired.

 A summary statement of any contamination found on the site and the cost of any

remediation activity needed to prepare the acquired property for the project, if

possible.

Owner: A person who owns legally or equitably a fee title, a life estate or is the contract

purchaser of any such estates or interests; has an interest in a cooperative housing project

which includes the right to occupy a dwelling; or any other interest, including a partial

interest, which in the judgment of the District Program Manager or Technical Support

Manager warrants consideration as ownership.

PAECETrak: A proprietary database owned by the Division and currently maintained by

BEMS Corporation that provides right of way document templates, tracking and document

retention. See Sec. 1.3.3.

Parking Spaces: For valuation purposes, this term refers to those spaces that would

meet municipal code and are not substandard to industry accepted safety standards.

Real Estate Acquisition Management Plan (RAMP) means a written document that details

how a Grantee, Subgrantee, or design-build contractor will administer the Title 23 right of

way acquisition, and relocation requirements for its project or program of projects. The

document must be approved by NJDOT.

Real Estate Taxes: Taxes imposed by municipalities, including assessments for libraries,

schools, fire districts and other charges on specific properties based upon the assessed

value of the real estate. Special Assessments and Roll Back taxes are also considered to

be real estate taxes. See 5.11.3 for date of owners’ tax liability.

Relocatee: Any occupant that is eligible for relocation assistance and relocation

payments.

Remediate: 1). To remediate or remediation in general is any process to clean up or

address hazardous contamination to the standards specified by NJDEP. Remediation work

conducted by the Department will normally be in accordance with the NJDEP Linear

Construction Guidance. Such work will be limited to the cleanup activity necessary to

implement the project, and will not include work on the remainder of the owner’s property

or remediation to a higher standard such as residential unless specifically stated. 2). An

assumption for valuation purposes in an appraisal that the property under consideration

is remediated and available for its highest and best use. This is only an assumption and

does not imply that the site is actually remediated or clean when used in an appraisal, this

assumption is referred to as appraised as if remediated.

Right of Way: Lands and property rights held by NJDOT, or an LPA. These consists of

three types: 1). Lands within a right of way corridor which serve the facility and which

are neither surplus nor excess to the facility. 2). Surplus Lands are lands that are not

currently needed by the facility, but which may have a use in the future. 3). Excess Lands

are lands which have been determined to be not needed currently or in the future for the

facility and which have been reviewed and approved to be sold or leased.

ROW Use Agreements: FHWA regulation 23 CFR 710.405 defines leases and licenses of

right of way as temporary transfers, which FHWA calls ROW Use Agreements.

ROW&AM: Right of Way and Access Management, a division of the New Jersey

Department of Transportation charged with oversight of the Department’s real estate

assets.

Scope of Work: The identification and proper use of the information and techniques that

are required to provide a meaningful and credible report. The term also represents the

type of work required by the client (agency) to answer the valuation or mitigation

requirements of the acquisition.

Settlement: Means the result of negotiations based on fair market value in which the

amount of just compensation is agreed upon for the purchase of real property or an

interest therein. This term includes the following:

1. An administrative settlement is a settlement reached prior to filing a condemnation

proceeding based on value related evidence, administrative consideration, or other

factors approved by an authorized agency official.

2. A legal settlement is a settlement reached by an authorized legal representative or

a responsible official of the acquiring agency who has the legal power vested in him

by State law, after filing a condemnation proceeding, including agreements resulting

from mediation and stipulated settlements approved by the court.

Small Business: 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 the payment for reestablishment expenses.

Surrender of Possession: The act by an owner of relinquishing possession of the

acquired real property or rights.

Severance Damages: Reduction in value as a result of the impact of an acquisition to

the remainder. Federal regulations limits this to realty and not to personalty.

Tenant: A person who has the temporary use and occupancy of real property owned by

another.

Tenant Owned Real Estate Improvements on a property: Tenant improvements are

improvements that were constructed by a tenant on leased property, and which during the

term of the lease would belong to the tenant. Owner improvements are all improvements

owned by the owner prior to leasing.

Trespass: Unlawful entry or possession of property. (See Encroachment)

Uneconomic Remnant: A parcel of real property in which the owner is left with an

interest after the partial acquisition of the owner's property, and which NJDOT has

determined has little or no value or utility to the owner, or which the owner indicates has

limited value to him. See Sec. 2.6.10 G.

Uniform Act: 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.

Unity of Use: A situation where an adjacent or adjoining property contributes to the

value of the subject property.

Unlawful Occupant: For relocation purposes, an unlawful occupant is any 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. The Director of the Right of Way & Access

Management Division may, for good cause, consider such a person to be in lawful

occupancy.

Utility Costs: Expenses for electricity, gas, other heating or cooking fuels, water and

sewer as applicable.

Weiswasser Mitigation: Property acquisition where NJDOT provides a piece of

replacement land to facilitate the mitigation of damages to the property.

Zoning: A code of development standards set in place by municipalities to control land

use. Zoning normally specifies acceptable uses, setbacks, building size, development

density (bulk requirements) parking ratios, landscape requirements and other limitations

on use. It should be noted that some zoning codes only address the bulk limits in that

zone while a separate portion of the municipal code deals with parking ratios and

“aesthetic” standards for development of a site over and above the zoning standards.

Zoning Non-conforming Condition: Not meeting current Municipal zoning code, but

considered to be conforming by virtue of being a preexisting condition that was previously

acceptable under a prior code or grandfathered by virtue of existing before the current

zoning code.

1.5 Early and Advance Acquisition

Where circumstances arise that require consideration of either an Advanced Acquisition

due to hardship or protective purchase or Early Acquisition, the Division or LPA must review

the funding eligibility requirements found in FHWA regulations at § 710.501 Early

acquisition and 23 CFR 710.503 Protective buying and hardship acquisition. Demolition

must be considered in planning to use an Early or Advance Acquisition.

See Addendum A1, A2 Early and Advance Acquisition FHWA guidance

1.6 Initial Project Responsibilities

1.6.1 Preliminary Engineering

Involves the following activities:

Prepare ROW Report, Initiation of ROW Impact Plan, ROW Kickoff meeting.

 During initial scheme development, a representative from the District Office will

provide guidance to the Scoping Team in evaluating the feasibility of various

alternative alignments. Following the initial scheme development and selection of

the initially preferred alternative, a design consultant or in- house design staff will

prepare preliminary right of way plans and transmit the plans to the District Office.

 The District Office develops preliminary estimates for property acquisition and

relocation along with a projected duration for the acquisition process, which are

utilized in the alternative selection process. The District will also perform a review

of the preliminary plans and submit any comments to the ROW Project Coordination

Unit.

 The District Fact Witness is given a copy of any plans, preliminary or when project

is assigned for negotiations in order to review the plans for any issues as part of the

preliminary and final review by the District prior to initiating acquisitions on the

project.

 The Bureau of Landscape Architecture & Environmental Solutions (BLAES) initiates

preliminary environmental screening to identify “environmentally sensitive parcels”

(ESP’s). Preliminary letters/data are forwarded to the Project Coordination Unit

within the Technical Support Bureau, to be transmitted to the District Office with

the preliminary right of way package.

 Project Access Plan & Access Impact Summary, initiates the access study and

notifies property The Bureau of Right of Way Engineering and Access Design

prepares the owners of proposed access modification/revocation.

1.6.2 Transmittal of Project to District Office

This process includes the following steps:

 Subsequent to the approval of the Department Action, state funding approval or

federal authorization and funding approval, the Project Coordination Unit transmits

the individual parcel maps (IPM’s), acquisition forms and descriptions to the

assigned District Office for the initiation of acquisition. The District office is also

provided with a file, containing any project specific material generated to this point

in time. This includes public meeting/hearing records, comments from property

owners and any other prior public contact. The District will also be provided a list of

all parcels which have gone through the Access Design process. In addition, all

pertinent correspondence including the final determination letter or last

correspondence with the owner, copies of all signed Lot Owner Access Concurrence

forms (LOACs) and copies of signed Lot Owner Lease Agreements (LOLAs) as well

as a copy of the Final Access cutout plan will be included.

 Detailed processes involving the transmittal of projects to the District Office and

Technical Support/district liaison are presented in the Right of Way Acquisition

Manual Administration Section. The District Program Manager will receive the

transmittal and review the package for completeness and complexity prior to

assigning the project to a Realty Specialist 4. The members of the project team and

the District Fact Witness will review the plans for any issues that should be resolved

prior to beginning acquisitions. The District Program Manager, along with the Realty

Specialist 4 and others, shall determine the ROW Availability date to be met by the

District. This date will be transmitted to the Project Coordination Unit and Project

Manager for inclusion in the database and the PRS system. Only the Director, District

Program Manager or their designee are allowed to determine the ROW availability

date. The use of electronic scheduling systems such as PAECETrak and also any

other approved system such as Microsoft Scheduler is required to establish an

accurate availability date.

1.6.3 Initial District Activities.

Right of way plans are reviewed by the District and the District’s Engineering Witness for

errors and omissions.

The District Office or unit conducting the acquisition prepares the appraisal plan, which

may include administrative determinations of value prepared for uncomplicated takings

valued at $25,000.00 or less ($10,000 or less for Local Public Agencies) and staff/fee

appraisers to be assigned appraisals and submitted to HQ for approval.

An initial written owner notification letter sent via certified mail that the Department is

proceeding to acquire the property, with a copy of the brochure, “How Property is

Purchased for Highway and Public Transit Projects”, which describes the various aspects

of the acquisition program and an Individual Parcel Map (IPM). together with a copy of a

relocation benefits brochure when applicable. Source 24.102(b). The letters are sent after

the owner’s proper address is confirmed with the municipal records.

After owner notification, site surveys are initiated and a Workable Relocation Assistance

Plan prepared by the District or responsible unit and approved by the Manager, Technical

Support.

 After the appraisal and relocation plans are approved, consultant appraisal order

requests are transmitted to the Technical Support Bureau, where the contracts are

prepared, circulated for approval and processed to the consultant appraiser.

Consultant appraisal reports and non-real estate reports are ordered

simultaneously, ensuring that the consultants will work in tandem, developing an

appropriate solution to the appraisal assignment. The District Project Realty

Specialist 3 or Realty Specialist 4 communicates regularly with each consultant

during the information gathering and problem solving stages.

 Completed appraisals are reviewed by a qualified staff or fee review appraiser to

ensure compliance with standards. The Review Appraiser will prepare a written

appraisal review report consistent with the requirements of the Appraisal and

Review Section of this manual. Prior to acceptance, the assigned Review Appraiser

(staff or consultant) will secure necessary corrections or revisions to the appraisal.

The staff review appraiser will determine the amount of just compensation and will

set it forth in a signed statement. Subsequently, the appraisal report is given to the

Project Realty Specialist 4 for the assignment of negotiations and the completion of

the acquisition process. Where a fee reviewer completed the report, a Realty

Specialist 4 or other authorized official will set the estimate of just compensation

based upon the recommended appraisal.

 Detailed processes for the appraisal and appraisal review function are contained in

the Appraisal and Review section of this manual and relocation requirements are in

the Relocation section.

1.7 Parcel Records

 A separate case file is maintained for each ownership of real property to be acquired

and consist of one or more properties that constitute a single economic entity. Parcel

records are important in that they contain the department’s formal record of

acquisition and relocation activity on the parcel. Files shall be maintained with all

materials in chronological order and firmly fastened in the parcel file folder.

 These records document the fact that bona fide negotiations were conducted with

the property owner, are utilized for audit purposes and form the basis upon which a

determination is made for eligibility of Federal reimbursement for project costs

incurred. The realty specialist’s negotiations contact record must clearly support

the completion of bona fide negotiations. Copies of all paper correspondence should

be made into PDF files and included into the Division’s data base system. The

Division’s data base system is to be used as the main storage for parcel records.

Any other file is secondary and should not be used as the prime storage process for

the District. Documents needing signatures will be transmitted separately to

Headquarters and then copies stored in the database, with paper copies kept of all

agreements, deeds and similar significant documents.

Section 2 Appraisal and Review

2.1 Valuation Overview

The Division of Right of Way & Access Management (ROW & AM), within the New Jersey

Department of Transportation (NJDOT) utilizes Real Estate Appraisals, and Administrative

Determinations of Value (ADV) to establish offers of just compensation for properties to

be acquired or excess land to be sold or leased. The Division uses Non Real Estate (NRE)

reports to aid in the mitigation of damages resulting from partial acquisitions of real

property or to provide specialized valuations not typically performed by real estate

appraisers.

Appraisals are prepared by ROW & AM staff or by qualified appraisal and NRE consultants.

ADV reports are prepared by ROW & AM staff or by qualified consultants and approved by

ROW & AM staff. NRE reports are normally performed by consultants hired by the ROW &

AM from a pre-qualified list of NRE Specialists. Parking mitigation NREs may also be

performed by the Design Consultant as a part of developing a project in consultation with

ROW & AM staff.

Appraisal Reviews are used to evaluate appraisals and as an overview of NRE reports for

quality.

Appraisal Review assignments are performed by in house staff or by consultant appraisers

hired by the Division from a pre-qualified list. All appraisal reviews, whether produced in-

house or by consultants must be registered by ROW & AM staff (or LPA staff) to approve

an appraisal for use as the estimated just compensation offer to owners.

Administrative Determinations of Value (ADV)

This is a simplified valuation by agency officials used only for uncomplicated minor

acquisitions with little or no severance damages. This document is also known as a waiver

valuation under federal regulations. An ADV is used to begin negotiations where the

acquisition value is $10,000 or less for Local Public Agencies and $25,000 or less for

NJDOT. If an agreement is not possible using the ADV, NJDOT or the Local Public Agency

must obtain and review a regular appraisal, and make a new offer based upon that

appraisal in order to complete the acquisition process and if needed, to proceed into court.

Where the appraisal value is lower than the ADV value, the NJDOT or LPA will offer the

ADV value, while the appraiser will testify to the lower value in the appraisal report. In

addition, if an owner who settles with an ADV requests an appraisal, the agency will need

to provide one for the owner. In deciding to use an ADV, the agency should consider

whether the time savings possible with an ADV are offset by the delays if an appraisal is

required later in the process. An ADV is not an appraisal and will not meet USPAP

requirements for an appraisal. It should be noted that owner accompaniment is not

required, but may be accommodated by the ADV preparer, depending upon the situation

and time permitting. Source Section 24.102(c)(2) for FHWA waiver valuation guidance

2.1.1 Regulation of Valuation Function

Appraisals are subject to the requirements set forth in the Eminent Domain Act of 1971

N.J.S.A. 20:3-1 et seq., and Appraisals and Appraisal Reviews are subject to the

requirements set forth in the federal Uniform Relocation Assistance and Real Property

Acquisition Policies Act of 1970 (URA), as amended [42 U.S.C. §4601 et seq.] and the

attendant regulations as set forth in 49 CFR 24. The NJDOT is authorized under an FHWA

Programmatic Waiver to use an ADV (defined in federal regulations as a Valuation Waiver)

where the estimated compensation is $25,000 or less or $10,000 or less for Local Public

Agencies in order to set what it believes to be just compensation as referenced in 49 CFR

24.2(a)(33) and 24.102(c)(2).

2.1.2 Organization Overview for Valuation

The Division of Right of Way & Access Management’s valuation responsibilities are divided

between the District offices and Headquarters.

A. District Offices

District offices are assigned real estate appraisal specialists who function as Staff

Appraisers and as Review Appraisers. The Districts can request the use of consultant

specialists such as contract fee appraisers, contract fee reviewers and contract NRE

specialists to assist with completing Projects through Consultant Order Requests

(Appraisal, NRE & Appraisal Review).

Typically, Projects are assigned to a Project Team, which is supervised by a Realty

Specialist 4 or other person assigned to assist with the valuation process for parcels on a

project. This process may begin as early as initial scoping and continue until an agreement

is reached with the property owner or the matter is referred for condemnation. The

Division may assign the District to continue oversight of the appraisal function into the

condemnation phase to provide continuity.

B. Technical Support Bureau

The Headquarters’ Technical Support Bureau is responsible for guidance and technical

support for the Division and the Department for appraisal and valuation related issues.

The staff of the Technical Support Bureau reviews appraisal plans and proposed consultant

contracts, conducts quality reviews and has audit oversight of appraisals and NRE services.

C. Closing Bureau Litigation Support Unit

The Litigation Support Unit provides valuation management services similar to the District

Offices once a case has reached the condemnation phase. The Litigation Support Unit

assists the assigned DAG from the Division of Law in preparation of the case for

condemnation.

D. Responsibility for Valuation Consultant Order Requests

The District Offices request consultant valuation services during the initial phases of a

project through the negotiation phase. The responsibility for ordering condemnation

update appraisals, appraisal reviews and NRE reports shifts from the District Office to the

Litigation Support Unit once a case is processed for condemnation. District Office staff

may be requested to provide support in resolving valuation issues that arise during the

condemnation process. In rare circumstances, the District Office may need to resubmit

an offer on a parcel due to issues found during the condemnation process. In that

circumstance, the District Office will resume oversight, if needed, of the appraisal services

for that parcel until the case is finally settled or returned to the Litigation Support Unit for

continued condemnation. The Technical Support Funding Unit provides contract

administration for valuation and NRE consultants. The Funding Unit upon request will also

obtain Access Impact Assistance reports or other valuation services for the Office of Access

Design (OAD).

17 
 
E.  Management of Valuation Services 
As set forth in 49 CFR 24.102(n)(2)  No person shall attempt to unduly influence or coerce 
an appraiser, review appraiser, or waiver valuation preparer regarding any valuation or 
other aspect of an appraisal, review or waiver valuation. Persons functioning as negotiators 
may  not  supervise  or  formally  evaluate  the  performance  of  any  appraiser  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.  
Because  federal  regulation  49  CFR  24.102(n)(2)    requires  that  no  undue  influence  be 
brought to bear upon an appraiser with respect to valuation, staff appraisal supervision is 
divided between Realty Specialist 4 Team Leaders who are responsible for productivity, 
employee  discipline  and  other  traditional  employee  issues  and  the  Appraisal  Section 
Supervisor who has oversight as to appraisal quality.  The District team leadership is not 
responsible  for  and  shall  not  supervise  or  evaluate  the  quality  of  the  appraisal  work 
performed by an appraisal staff member.    Appraisal quality concerns  such  as valuation 
issues  or  USPAP  compliance  are  under  the  purview of  the  Appraisal  Reviewer  (Staff or 
Consultant).  If there are appraisal quality issues that cannot be resolved by the Appraisal 
Reviewer, they may be elevated to the Appraiser 3 who has oversight responsibility for 
the quality of the appraisal assignments.  Team leadership can forward quality of work 
concerns to the Appraiser 3, and the Appraiser 3 may audit any valuation report to make 
a determination on the quality of work.  Any staff appraiser performing valuations with a 
concern about undue influence on his or her opinion of value should discuss that concern 
with the Appraiser 3.  Where applicable, an LPA should segregate oversight of the quality 
of the appraisal product from the negotiation element of the process. 
F.  Legal Issues 
Legal guidance for NJDOT is provided by the Division of Law on any appraisal or NRE issues 
involving access, compensable damages, unity of use or any other legal issues regarding 
valuation whenever these issues may arise.  LPAs should consult qualified attorneys on 
staff or hired for that purpose. 
2.2  Project Valuation Responsibilities 
This section provides an overview of the basic steps involving the valuation process as it 
relates to a typical Right of Way Project.  The Division may be requested to undertake work 
outside of the typical project framework.  This may involve any of the right of way services 
the Division provides including but not limited to, performing preliminary estimates and 
obtaining  appraisals  and/or  appraisal  reviews  for  an  outside  agency.   To  the  extent 
possible, these atypical assignments are to be undertaken as closely as possible within the 
project format set forth herein.  Regardless of the source of an assignment, all valuation 
services must be completed in compliance with the standards in this manual.  Preliminary 
Phase 
The  Right  of  Way  District  office  undertakes  the  following  tasks  upon  being  assigned a 
Preliminary Project: 
  Initial Scoping 
  Map Reviews 
  Prepare Acquisition Estimate 
  Prepare Relocation Estimates 

 Initial planning for valuation and NRE Report needs.

The District Office may submit Consultant Order Requests to engage the services of

Valuation consultants to assist in the scoping and preliminary engineering phases of a

project. These requests are meant to assist in project planning and are separate from any

advance acquisition requests.

2.2.1 Project Acquisition Phase

The District Office will obtain appraisals and other valuation services for projects in

conformance with this Manual.

A. Map Review

The District should identify and address any mapping errors and technical right of way

related issues which create constraints for the project as early in the process as possible.

Map issues identified after the case has progressed to condemnation will be initiated by

the Litigation Support Unit unless the changes are sufficient to require a return to

negotiations, in which case the District Office will resume map oversight for the parcel.

B. Initial Valuation Needs Planning

The District Office assigned team or consultant, in consultation with the Review Appraiser,

shall evaluate the valuation needs (appraisal, appraisal review and/or NRE) for the Project.

Prospective assignments to valuation and /or NRE consultants shall be based upon

geographic competency (appraisal services), quality of previous work, complexity of

assignments, licensure required and the consultant’s expertise and skill level. Those

consultants that are deemed to be qualified for a particular assignment will be contacted

to determine their availability for assignments, as well as their ability to deliver the work

product in accordance with the project schedule. Real estate appraisers (staff) shall

likewise be selected based on their availability, individual experience/capabilities and

licensure needed to complete the assignment.

The valuation needs assessment (appraisal, appraisal review and NRE) for a project shall

result in a formal “Appraisal Plan”. The appraisal plan is reviewed and approved by the

Realty Specialist 4 and the District Program Manager for all District Office projects. All

Division appraisal plans require the approval of the Technical Support Bureau. Appraisal

plans should consider the following elements:

 When ADV’s are to be used, the “Appraisal Plan” shall indicate which appraisers

would provide backup appraisals in the event negotiations based on the ADV fail.

 In determining what appraisal and NRE services are appropriate, the assigned team

must take into account all acquisition impacts to the property to avoid the need for

revised reports.

 The Scope of Work should reflect all issues which are required for a complete

valuation or NRE report. (See “Ordering Appraisal and NRE Reports” below.)

 Project timing is a critical element of valuation planning. Some considerations in

the analysis are: assignment due dates, total of number of assignments given to

any one provider from all projects, types of valuation assignments, relationship

between parcels, level of expertise and licensure required and availability to do the

work required.

 The appraisal plan should seek to minimize the total time required to complete the

valuation phase of the project except where project timing is not critical. Limiting

the number of assignments to any single provider is one method to decrease the

time required to obtain the reports. Bundling assignments into larger assignments

to save costs should only be considered where longer time frames for completing

assignments do not significantly increase the risk for substantial project delay costs.

 As part of its planning, the District Office should consider assignments to less

experienced appraisers and NRE consultants where acquisition value is nominal and

project schedule provides time so as to increase the experience level of appraisers

and NRE consultants. The District Office reviewers and the Technical Support

Bureau are available to assist newer appraisers during the initial assignments.

C. Ordering Appraisal and NRE Reports

Upon approval of the appraisal plan, and Workable Relocation Assistance Plan (WRAP) the

Realty Specialist 4 or Realty Specialist 3, working with the Staff Review Appraiser,

schedules on site meetings with consultants and/or staff appraisers to obtain work

commitments and review the scope of work needed for each parcel. If there are any

changes in the scope of work from the appraisal plan, they must be reflected in the Staff

Assignment or Consultant Order Request. In the event that a full service right of way

consultant is tasked to assist in obtaining consultant services, the Realty Specialist 4

assigned to oversee the project will be responsible for ensuring that the proposed

Consultant Order Requests meet the Project schedule needs and that the appropriate scope

of work is addressed.

1. Scope of Work - The Scope of Work is to be mutually agreed to by NJDOT and the

person performing the assignment. The term “Scope of Work” defines both the general

parameters of the assignment and specifically for an appraisal assignment; it describes

the level of research and work which goes into appraisal or appraisal review reports.

The scope of work for an assignment should be developed cooperatively by the person

performing the assignment and a NJDOT official who is competent to both represent

NJDOT's needs and to respect valid appraisal or NRE practice.

a. For appraisal assignments, the scope of work statement should include the purpose

and/or function of the appraisal if different from a standard eminent domain report,

a definition of the estate being appraised if it is not fair market value, and any

assumptions and limiting conditions affecting the appraisal that are not standard for

NJDOT appraisals. If the appraisal is a “land only” appraisal, or directs a report that

does not consider all three approaches, the scope of work must state that as well.

The Scope of Work must also set forth any special conditions such as consideration

of one or more NRE reports, realty/personalty reports, legal instructions, special

dates of value such as the date of complaint, etc. Scope of work for appraisals is

addressed in 49 CFR Section 24.103, 24.102, and Appendix A to Part 24—Additional

Information and in the latest edition of the Uniform Standards of Professional

Appraisal Practice (USPAP).

b. For NRE reports, the scope of work should address any elements of the mitigation

or valuation service that would be necessary to meet NJDOT or Local Public Agency

needs for the NRE report along with the level of research needed to complete a

competent and credible report. For mitigation reports, elements to consider could

include consideration of the use of adjoining NJDOT property, truck maneuvers

around the site, locations of loading docks, specific access instructions from the

Division, specific date of value, etc. NOTE: The use of NJDOT property as part of a

mitigation can only occur with the approval of the Technical Support Bureau as

discussed in Section 4.

c. Regardless of the type of report, the scope of work must specify the type of work

needed for the assignment. Where a specific service is needed that is not typically

part of the assignment, such as consideration of a property in an interim condition

or as of a specific date, that consideration must be included in the scope of work to

avoid having to redo the report and creating project delays.

2. Due Dates - Due dates should be based upon the project schedule and the time typically

required to complete reports. Issues such as complex assignments and relocations may

indicate a need for an early start on appraisals to accommodate complex valuation or

acquisition issues within the project schedule.

 In obtaining due date commitments from staff and/or consultants, the valuation

expert should agree to the due date and be aware that late delivery (“slippage”) is

discouraged.

 For projects with sufficient lead time, isolated instances of short term lateness, for

valid reasons, are acceptable without formal sanction. Should instances of lateness

become a pattern, the appraiser/consultant is to be advised in writing of the

unacceptability of such service. Copies of written notifications are to be retained for

the purpose of staff performance evaluations and the annual consultant evaluations.

 The District Office or the Unit originating the assignment is responsible to make sure

that the assignment is done within the project schedule. If, during the follow up

process, it is determined that the delivery date will not be met due to substantial

nonperformance of the appraiser/consultant, written notification of the intent to

cancel the contract shall be sent immediately with a copy forwarded to the Technical

Support Bureau. Notification shall indicate that in such instances, consultants risk

loss of payment for work already done on open parcel assignments, in addition to

loss of pre-qualified status. Where the Consultant does not provide the service

required within a reasonable time after notification, the Technical Support Bureau

will be notified that the reports have not been received and will take any required

corrective action up to and including cancellation of the report. The District Office

shall not cancel contracts without concurrence from the Technical Support Bureau.

Information from each step in this process shall be entered into the Right of Way

database and retained for annual ratings.

3. Staff Appraisal Assignments - Staff appraisal assignments are issued within the District

or the unit handling the Project by the Realty Specialist 4 or Realty Specialist 3 or Staff

Reviewer. They are to contain all relevant information required for the Staff Appraiser

to competently complete the assignment. This includes any information regarding

access changes and legal instructions.

4. Consultant Appraisal Order Requests - Appraisal Order requests for consultants must

state the full scope of the work required as described above and include the due date.

The appraisal order should also contain justification for negotiated fees and where the

assignment exceeds $5,000 the order should provide a breakdown of the cost in the

form of a quote in hours. Appraisal consultant assignments and due dates are to be

maintained in the Right of Way database.

5. General Appraisal Assignment Guidance - Audit appraisals are required where the

compensation exceeds the limits shown under Section 2.2.19. The Division of Law

should be consulted in those appraisal situations involving questions of a legal nature.

In the event that an NRE report is or will be needed, the Appraiser must work with the

NRE consultant to ensure that the proper valuation issues are addressed. While an

Access Impact Assessment report will normally be a separate item, the input of the

Appraiser on the cost effectiveness and reasonableness of an Access Impact

Assessment report is appropriate to avoid paying more to mitigate than the economic

damages are worth to the property.

Appraisers shall not be instructed to limit their evaluations merely to valuing the land

and impacted site improvements; unless they fully agree that the existing

improvements are not adversely impacted by the acquisition and thus do not need to

be valued. If the appraiser is undertaking a “land only” report and the appraiser’s

research indicates the need for more than a “land only” report, the appraiser must

contact the unit which originated the assignment for a supplemental order expanding

the scope of work.

6. Consultant NRE Order Requests - NRE order requests for a consultant NRE must state

the full scope of the work required and must include written proposals from the

consultant with each NRE order. The proposal is to include a breakdown of tasks with

lump sum costs based on hourly rates. The CPM overhead rate is not used by the

Division and the proposal costs should be based on lump sum or hourly rates that reflect

the total charges due the consultant. The proposal is to be reviewed by the unit

originating the assignment to assure that the consultant fully understands the scope of

the problem to be addressed and any legal and/or regulatory implications and the

extent of the information to be contained within the report. Guidance from the Division

of Law should be sought in those situations involving questions of a legal nature. The

NRE consultant is expected to work with the appraiser in developing his/her report.

NRE consultant assignments and due dates are to be maintained in the Right of Way

database.

7. Staff Appraisal Review Assignments - Staff appraisal review assignments are issued

within the District office or the unit handling the project by Realty Specialist 4 and are

to contain all relevant information required for the Staff Reviewer to competently

complete the assignment. This includes any information regarding access changes and

legal instructions. Staff appraisal review assignments and due dates are to be

maintained in the Right of Way database.

8. Consultant Appraisal Review Order Requests – Consultant Appraisal Review Order

requests must state the full scope of the work required. Special attention should be

paid to unusual circumstances, such as consideration of a non-real estate report,

departure from standard practice, or elements required to satisfy legal requirements.

Guidance from the Division of Law should be sought in those situations involving

questions of a legal nature. Consultant assignments and due dates are to be

maintained in the Right of Way database.

9. Review Assignment Guidance - In the event that an NRE is or will be needed, the scope

of work must provide for the appraiser to comment on the strengths and weaknesses

of each NRE report used for the assigned parcel.

In the event that more than one appraisal is obtained, the Review Appraiser must

evaluate and explain which one of the appraisal reports is best supported by market

data and analysis and thus recommended to support the estimate of just compensation

offer to the owner.

2.2.2 Submitting Consultant Order Requests

Consultant orders are to be submitted in the approved format and must contain a scope

of work which covers the nature of the acquisition and the valuation or NRE problem.

The scope of work from the Appraisal Plan may be used for the Consultant Order if it

remains unchanged. Changes or modifications to the scope of work since the Appraisal

Plan must be reflected in the scope of work section for the Consultant Order. The

Consultant order forms the basis for the contract. If the Scope of Work is not properly

defined the consultant may not provide the correct service, creating delays and contracting

issues. Consultant order requests are generated by the District Office during initial

negotiations and by the Litigation Support Unit during condemnation and forwarded to the

Technical Support Bureau for approval and issuance of consultant contracts from

Headquarters.

Requests for valuation work made by an assigned DAG will be processed by the Litigation

Support Unit during condemnation and by the District Office if associated with the

negotiation phase. The negotiation of fees and compensation will be undertaken by the

District Office for negotiation phase parcels and by the Litigation Support Unit for

condemnation phase parcels.

While a DAG is expected to participate in the determination of a scope of work for the

condemnation related appraisal and NRE reports, only the Division is authorized to

undertake contract commitments and to negotiate fees with consultant valuation and NRE

experts. All fees are subject to approval by the Technical Support Bureau and the Director

in accordance with NJDOT policies and procedures.

A. Headquarters Consultant Order Request Processing

Upon review and acceptance of the Consultant Order Request from the District Office or

the Litigation Support Unit, the Technical Support Bureau reviews and approves a

consultant contract and a Department Action prepared by the Funding Unit to authorize

the expenditure of funds. This package is submitted to the Manager of the Technical

Support Bureau for review and upon acceptance, the Bureau Manager submits the package

to the Director of the Division of Right of Way & Access Management for final approval.

B. Consultant Acceptance of Order

The consultant agrees to the terms of the contract by signing and returning the executed

acceptance copy. The contract represents the full and complete terms. No payment can

be made for any work that does not comply with the contract terms. The consultant cannot

proceed with his/her assignment until they have executed and returned the contract. The

contract process commits funding on the part of the Department. Work done without a

contract in place is strictly at the risk of the consultant. The Department does not recognize

oral contracts and no funding is obligated until a contract is approved internally within the

Department.

2.2.3 Report Delivery

All reports, whether prepared by staff or consultants, must be submitted in the format

specified by NJDOT and are to be signed by the individual preparing the report and

delivered as specified in the contract, ready for immediate use. Where electronic delivery

is specified, the electronic report shall contain a signature. The initial report, together with

any corrected versions should be identified as drafts. Upon proper review and acceptance,

the final corrected version will become the final product. At that time the valuation

specialist or NRE consultant will be notified of acceptance of the report and requested to

deliver bound copies of the report in triplicate to the District Program Manager or Litigation

Support Unit unless the assignment indicates another addressee or other amount of bound

copies.

2.2.4 Report Review

All Appraisal and NRE reports, regardless of value must be reviewed and accepted by

NJDOT. ADV reports do not require a formal review, however, each must be

approved/registered by a person familiar with the facts behind the valuation and

competent to determine if the estimated valuation or mitigation compensation is

reasonable.

A. Formal Review

The formal review process will be carried out in accordance with NJDOT Standards. In the

event that no appraisal is accepted by the Review Appraiser or there is no appraisal which,

in the opinion of NJDOT, properly reflects just compensation, the situation should be

reviewed with the Technical Support Bureau to determine the next course of action.

B. Formal Reviews Prepared for Local Aid Projects

For Local Aid Projects, when the Division undertakes to prepare reviews on behalf of a local

unit, the Reviews will be treated as if they were internal reviews and retained within the

Division for audit purposes. A letter indicating the outcome of the review will be prepared

for the use of the local unit in place of the actual Review document. Corrections, Revisions,

and Additions. When a correction or a revision is necessary as a result of the review or

other changes, the appraiser or specialist shall furnish corrected, revised or supplemented

pages or portions of the report for attachment to the copies already delivered. Where

reports are submitted electronically, the revised report shall be submitted in whole.

Changes initiated by the appraiser or specialist must be delivered through regular channels

and accepted by the Division as a formal revision of the original report.

2.2.5 Processing Consultant Payment Requests

The consultant specialist must utilize the official NJDOT payment voucher (invoice).

Consultants typically submit the signed invoice for payment when conveying the initial

report. Invoices will not be processed until after the initial review process is completed.

Partial payments are not made EXCEPT where the contract stipulates otherwise or where

the assignment is cancelled prior to completion and the partial work is to be paid for or

where minor revisions due to map changes are made for a supplemental fee. Testimony

services are generally billed separately from the contracted fee for the valuation/NRE

service based upon the contract specified rate for testimony.

2.2.6 Project Assigned to a Full Service Right of Way Consultant

Where a consultant is assigned a Project or a portion thereof, the consultant shall conduct

those functions assigned under the terms of its contract in accordance with this Manual.

The Realty Specialist 4 and the Staff Review Appraiser retain responsibility to oversee the

Project functions undertaken by the right of way Consultant. Decisions to commit State

money (actual selection of appraisers, registration of appraisals and ADV reports, fee

negotiations, settlement amounts, etc.) can only be made by Division officials authorized

for that activity. Consultants are not authorized to determine the amount of or approve

the expenditure of State or LPA funds.

2.2.7 Registration of Case

All offers made in the Acquisition Process are based on the appraised estimate of just

compensation and must be based on a registered appraisal or an ADV approved by a

Division or Local Public Agency official. For appraisals, the Registration must be based on

an accepted and approved appraisal as determined during the Review Process described

in Section 2.10, upon which NJDOT or Local Public Agency bases its estimate of just

compensation as required by Section 24.102(d) of Part 24 of 49 CFR. The approval of an

ADV by a NJDOT or Local Public Agency official is considered to be a Registration for the

purpose of providing an estimate of just compensation for the acquisition process. An ADV

has special requirements as discussed elsewhere.

The NJDOT official who registers the approved appraisal will normally be an Appraiser II.

Under limited circumstances a higher level Division official with sufficient experience and

understanding of the process to perform a fair and proper determination of the estimate

of just compensation may register the approved appraisal instead of an Appraiser II. The

Local Public Agency will designate an official with a reasonable understanding of real estate

to register the appraisals that were approved by their review appraiser.

Administrative Determinations of Value should be approved (registered) as the Division’s

Estimate of just compensation by a Staff Review Appraiser or Realty Specialist 4 or

appropriate Local Public Agency official. An appraisal review is not required.

Upon registration (or approval of an ADV), the Division or Local Public Agency will proceed

promptly to acquire the property by negotiation in accordance with Section 3.8 of this

manual [see 49 CFR Section 24.102(a) and (d)].

2.2.8 Pre Condemnation Revisions and Report Updates

If information presented by a property owner, or a material change in the character or

condition of the property or proposed acquisition occurs, which indicate the need for

changes to the appraisal and/or NRE information, or if a significant delay (dependent upon

market conditions) has occurred since the time of the appraisal(s) of the property, the

Division will have the appraisal(s) and if needed NRE(s) updated or obtain new appraisal(s)

and if needed NRE(s) to reflect the changed conditions or elapsed time as set out in 49

CFR Section 24.102(g).

Delays created by a property owner during negotiations do not necessarily create the need

for an update provided that the report was up to date and appropriate at the start of

negotiations and that there are no significant changes to the conditions that would

otherwise require an update. This decision should be reviewed with the DAG assigned to

the District.

Updated reports may not be required in those cases where:

 The original consultant and property owner are unchanged,

 The real estate has undergone no significant change since the original report,

 The time frame between the original valuation and the complaint date is not

unreasonably long for the type of real estate and market conditions involved

 Only minor change has been made to the acquisition and

 No significant change in the original value estimate is indicated by the appraiser.

If these conditions apply and the appraiser is satisfied that despite the revisions her/his

value estimate remains appropriate, the appraiser may prepare an updated and expanded

transmittal letter referencing their original report, definition of value, date of value

estimate, property rights appraised, approaches used, reconciliation, value conclusion,

scope of investigation and analysis involved in determining the particular circumstances

occurring during the intervening time period and a new certification and any additional

qualifying/limiting conditions or underlying assumptions.

In the event the appraiser’s investigation supports a significant change in value, regardless

of the time period intervening, a full, updated appraisal report shall be secured using the

process set forth above.

Where circumstances indicate that NJDOT would be better served by an entirely new

report, the Realty Specialist 4 in consultation with the Review Appraiser will undertake to

obtain a new appraisal report in accordance with the Manual.

Staff Appraisal assignments or Consultant Order requests required for updated reports pre

condemnation are to contain an explanation of the revised work or need for a new appraisal

and are processed in the same manner as set forth previously. Where consultant fees are

negotiated, those negotiations should also consider the work already done in the initial

report and the amount of additional work required. The Consultant Order Request should

have the appropriate scope of work and justification for consultant fees.

2.2.9 Pre Condemnation Update Offer of Just Compensation

If NJDOT determines that a change in the purchase offer is warranted as a result of the

elements in Section 2.2.9, NJDOT will promptly reestablish just compensation and offer

that amount to the owner [49 CFR Section 24.102 (g)].

2.2.10 Post Condemnation Update Requests

Upon submission of a case for condemnation, the oversight for valuation and NRE

consultants shifts from the District to the Litigation Support Unit which will order updated

appraisals, appraisal reviews and NRE reports required for condemnation in accordance

with the Consultant Order process and standards set forth previously, acting in place of

the Project Team for this function. The Litigation Support Unit and the Technical Support

Bureau assists the assigned DAG with valuation issues in litigating the condemnation case.

The selection of the appraiser(s) and NRE specialist(s) for the updated report(s) will be

made by the Litigation Support Unit in consultation with the assigned DAG. The Litigation

Support Unit and not the DAG is responsible for obtaining contract commitments from

consultants and the negotiation of consultant fees.

The District Office remains involved in the valuation process in an advisory and assistance

role where appropriate. Examples would be conducting the review of NRE reports by the

District’s engineering witness and background discussions by the District’s reviewer with

the reviewer assigned for the condemnation phase (if different from the original

assignment). The District remains responsible for any corrective negotiations that may be

determined to be necessary to meet bona fide negotiations. Relocation efforts remain the

responsibility of the District even during condemnation.

The appraiser(s) and/or (NRE) specialist(s) will submit draft report(s) directly to the

Litigation Support Unit in accordance with the instructions specified in the contract. Drafts

will only become final work product upon acceptance by the Division.

The Litigation Support Unit representative(s) will coordinate with the designated fee or

staff reviewer, NRE specialists and the assigned DAG, as well as the original reviewer to

ensure that any legal requirements have been considered within the report.

An initial review for completeness will be conducted by Litigation Support Unit staff at the

same time as the report is being formally reviewed by the assigned Staff or Consultant Fee

Reviewer to allow processing of payment for substantially complete reports. Updated or

new reports should not be registered until they are reviewed and approved by the DAG

assigned to the case.

The assigned DAG will review the materials and advise the Litigation Support Unit of any

issues prior to re-registering the appraisal report as appropriate. Upon notification that

the Department has accepted the report the appraiser(s) and NRE consultant(s) will

provide the Litigation Support Unit with the required number of bound copies of the

appraisal(s) and NRE(s) which the DAG will distribute to the property owner and

Condemnation Commissioners in accordance with the New Jersey Court rules.

The assignment or consultant contract will specify how many copies of the finalized

accepted report the appraiser or NRE consultant will supply as well as a set fee (where

applicable) for any additional copies that may be needed at a future date.

The necessity for additional court deposits shall be predicated upon a consultation between

the assigned DAG and the Legal Processing Realty Specialist 3.

2.2.11 Miscellaneous Valuation and NRE Service Requests

On occasion consultant Appraisal and NRE services will be needed outside of the normal

Project framework. The person assigned to oversee or liaison with the Special Project will

request Staff and/or consultant services using the standard Appraisal and NRE Order

process set forth in Section 2.2.1 et seq. All reports must adhere to the relevant standards

and requirements found within this Manual.

2.2.12 Reports to be provided to the Property Owner

The property owner shall be provided a copy of each approved and rejected appraisal

report or ADV report along with any NRE report for the parcel that the Division receives

during the negotiations phase of the acquisition process. The assigned DAG should be

consulted to determine if the unapproved report is exempt from distribution to the owner

or if some form of explanation regarding the rejected status is appropriate to be provided

to the owner with that report.

In the event of a condemnation, the owner is given copies of the approved and registered

Appraisal and NRE reports that the Division is relying upon in estimating just compensation

for testimony. Other reports obtained during the condemnation phase which were not

relied upon for valuation are not provided to the owner. Questions about this process are

to be discussed with the assigned DAG.

2.2.13 Presentation of ADV Offer to Owners/Agents

Administrative Determinations are presented directly to the owner/agent and the offer

letter is to reflect that the value is set on an ADV instead of an appraisal.

2.2.14 Owner’s Request for an Appraisal (ADV Cases)

If the owner requests an appraisal for a settled ADV case, the District Office should order

an appraisal for presentation to the Owner/Agent.

2.2.15 Interagency Administrative Determinations of Value

Where the Department is providing an estimate of value to another state agency or similar

body, and the land to be transferred is not to be acquired through eminent domain, the

Division may prepare an estimate to support that transaction in a format similar to a

standard ADV in an amount in excess of $25,000, to include the level of documentation

requested by the receiving agency. This process is limited to intergovernmental transfers

and is used in lieu of an appraisal where the other agency agrees that an ADV estimate

method is sufficient for the transfer.

2.2.16 Administrative Determinations of Value in Condemnation

If a settlement cannot be reached using an ADV, the District Office will request an appraisal

which will then be presented to the owner. If continued negotiations with the appraisal

are unsuccessful, the case will proceed through the normal condemnation process using

the appraisal. The ADV cannot be used in place of an appraisal when condemnation is

undertaken.

2.2.17 Appraising Green Acres, Farmland and Conservation Restrictions

Appraisal reports which are needed for Green Acres or conservation restricted lands should

be obtained from consultants who are on the Green Acres approved list as identified in the

Division qualified appraisal list. Likewise, preserved farmland appraisals should be

obtained using State Agricultural Development Committee (SADC) approved appraisers as

noted on the Division qualified appraisal list. The appraised value should be based upon

the regulations that apply to the protected property. Typically, the appraisal would value

the site with a highest and best use reflecting what the site could be used for without the

deed restriction, and in the case of Green Acres, without regard to park or conservation

zoning that the municipality applied to the site after it was restricted. The appraiser should

consider any relevant physical characteristics of the property including wetlands that would

impact any other property highest and best use.

2.2.18 Appraisals required per parcel

One appraisal is obtained for each parcel or group of parcels that form a functional entity

unless any of the following exceptions apply:

 The project is of such a critical or accelerated nature that the Division determines

that multiple appraisals will help to assure completion on schedule.

 The Division deems that the acquisition is of a complex nature, requiring an

additional appraisal.

 A staff appraiser prepares an appraisal as a secondary report to a consultant

appraisal in order to gain experience. Caution should be exercised in using this

option to ensure that this second report does not create an excessive burden to the

Project schedule or exceed the staff appraiser’s license or certification.

 Two separate appraisal reports are required where the just compensation exceeds

$1,000,000 for an entire acquisition or $500,000 for a partial acquisition.

 Two separate appraisal reports are required where the just compensation exceeds

$250,000 for a Green Acres regulated parcel. Additional reports will also be obtained

when required by other regulatory bodies as part of their approval process.

 Unless the Owner requests one, an appraisal is not required where an ADV has been

performed and accepted by the Owner and the case has been settled.

2.2.19 Appraisals for Dedications and Donations

Donations: An Owner may donate property that the Department or LPA intends to acquire

for a project, but must be informed of his right to compensation. Appraisals are not

required where an Owner donates the property and releases NJDOT from the obligation to

provide an appraisal. An owner may also donate property that is not currently needed or

being acquired by the Department. This donation does not require a waiver of

compensation, however, if the Department accepts the donation, the owner may be

provided with an appraisal if the owner requests one for tax purposes.

Dedications which result from an exercise of police power such as zoning approval

conditions or developer dedications under the access code are not considered takings and

do not require compensation or appraisals.

2.3 Valuation Management

2.3.1 Consultant Pre-qualification List

The Technical Support Bureau shall maintain a list of qualified fee appraisers and NRE

specialists. As updates occur, copies of this list should be provided to the Director, the

District offices, Division of Law, and NJDOT’s Consultant Selection Committee (CSC). Local

Public Agencies shall follow state laws that regulate contracting, however, valuation

consultants (appraisers and appraisal reviewers) must be selected first upon their

qualifications and ability to perform the assignment and then price may be negotiated after

a selection is made in accordance with federal requirements.

2.3.2 Consultant Eligibility for Pre-qualification List

In order to be added to or remain on the pre-qualified employment list, each Consultant

Service Provider must meet all State laws, rules and regulations governing continued

employment with the State. The Department considers individual consultants for addition

to its prequalified list based upon the experience, education, training,

certification/licensing, designation(s) and other qualifications necessary to provide the

required services. Consultants working for firms are typically treated as individuals for the

purpose of the contract, since the work performed is specific to that consultant’s report,

and testimony is expected to be given by the consultant undertaking that work.

Consultants must also be eligible to be vendors under state law and regulations.

The CSC considers the recommendations of the Technical Support Bureau and approves

consultants based on evaluation of their professional and technical qualifications by the

Division. Applicants for consultant appraiser status must possess a New Jersey general or

residential certification and should have demonstrated experience in condemnation

appraisal and expert testimony. NRE consultants must be licensed or certified in their

discipline and have documented education and experience in their particular discipline.

Consultant reviewers must be New Jersey certified general appraisers.

Upon filing the application and providing supporting documentation, the applicant is

interviewed by the Technical Support Bureau. The interview should include evaluation of

the consultant’s staffing and support resources. An effort must be made to confirm the

references, as well as any experience or education not fully documented. Following the

interview and investigation, the Technical Support Bureau submits a recommendation on

the application to the Director.

Upon approval by the Director, the supporting documentation is sent to the CSC for

concurrence. Appraisers/NRE specialists are given tentative status until they demonstrate

competency with all aspects of the assignment and initial assignments will be of a less

complex nature. In the event assignments are unacceptable and efforts at achieving

correction are unsuccessful, removal from the list may be considered. If an initial

application is not recommended for approval and the CSC concurs, the applicant is notified

in writing and given the basis for the decision.

Removal from the list shall be based upon reasonable grounds and applied in a manner

which is not discriminatory or arbitrary. A consultant may be removed for failure to be

licensed/certified (where applicable), or for such other reasons as may be reasonable to

protect the public interest.

2.3.3 Review of Prequalified Consultant List

The consultant appraiser/NRE specialist list shall be reevaluated on an annual basis by the

Technical Support Bureau, which shall remove those consultants who do not meet the

qualifications. The Technical Support Bureau will review the critiques submitted by the

review appraisers of the work submitted by consultants during the course of the year.

In instances where a consultant has not completed any assignments for a five year period,

he/she may be required to update the experience and qualifications statements.

Consultants who do not respond to requests for license updates, “pay to play”

certifications, or contact documentation will be removed from the prequalified list.

2.3.4 Consultant Fee Guidance

The fee for an assignment is intended to represent fair payment for the services rendered.

Among the factors to be considered when negotiating a fee are:

 Complexity of the assignment and skills necessary to effectively complete the job.

 Number of parcels assigned on a project and degree of similarity or variation.

 Quantity of information provided to the consultant, versus the need to gather

information independently.

 Type of report and supplemental information required.

 Time constraints imposed by the project.

For condemnation update reports, the amount of the fee shall represent a fair payment for

the services to be performed and be commensurate with the scope of work for this

assignment. Considerations include the length of time since the original report, any

additional research or work required, etc. The fees for appraisal are subject to NJDOT

appraisal fee policy.

2.3.5 Additional Division Staff Functions

A. Division Report of Review Statements and Appraisals

District office staff will make the appropriate entries in a timely manner to the Right of

Way Database as to appraisals received and registrations made.

Additional Functions for Staff Reviewers

The review appraiser may provide valuation services for functions other than property

acquisition. This will be coordinated by the District Program Manager or by the Technical

Support Manager for Headquarters related functions.

B. Preparation of ADVs

Staff appraisers and staff review appraisers may prepare and approve ADV reports.

Consultant Appraisers may prepare but not approve ADV reports. The preparer of an ADV

should not sign in their capacity as an appraiser since the ADV is not an appraisal and

would not satisfy the obligations required by USPAP for appraisals.

C. Valuation in Support of Relocation and Property Management

Staff reviewers (and staff appraisers) may provide valuation services needed in support of

relocation and property management activities as follows:

 Value estimates, or reviews of appraisals of surplus property.

 Estimate of market rent to be charged in lease of NJDOT owned property.

 Estimate of economic rent of an owner-occupied dwelling in support of a rental

replacement housing payment determination for relocation.

 “Carve outs” or allocations of the appraised value for major exterior attributes or

excess land etc. For the determination of the “base value” to be used in calculating

relocation replacement housing payments.

2.4 Quality Control

Quality Control in the valuation process is primarily the responsibility of the

staff/consultant service providers who are providing the work product. It is expected that

each consultant has in place and will maintain a quality control program. The Technical

Support Bureau monitors consultant compliance with this requirement.

It is the responsibility of the District Program Manager to address timelines of appraisal

assignments with the Appraisal Supervisor.

The Technical Support Bureau is to be provided with copies of all District communications

to consultants regarding inadequate performance. Each review is to be accompanied by a

rating of the appraisal work product and a rating system incorporated into the database

system. These findings are utilized to highlight areas needing improvement and to develop

staff and consultant training programs based upon an ongoing assessment of corrective

action requests. The Technical Support Bureau, in conjunction with the District Office will

conduct at least one information session annually for consultants, covering changes in

regulatory procedures, legal guidelines and appraisal format requirements.

Individual training and/or orientation will be provided as needed, with particular emphasis

on those consultants performing initial assignments.

On a regular basis, the Technical Support Bureau Manager shall select one or more

experienced District office Reviewing Appraisers which will comprise a quality review team.

The FHWA Right of Way Officer may, at her/his discretion, participate as a member of the

team. The team shall perform a quality review of selected cases within each of the District

offices and issue a report as to their findings. Corrective action will follow as determined

necessary by the findings of the report. In the event the FHWA Right of Way Officer does

not participate as a member of the team, a copy of the report will be provided to the FHWA

Division Office.

2.5 General Valuation and NRE Background Information

This general information applies to Appraisals, NRE reports, ADV’s and Appraisal Review

Reports. The person performing the valuation or NRE report should take these general

standards into account as well as the individual specific standards for Appraisals, ADV’s,

NRE’s and Appraisal Reviews which follow later in this Manual.

A. Consultant Acceptance of Contract

The consultant agrees to the terms of the contract by signing and returning an executed

acceptance copy. The contract represents the full and complete terms. No payment can

be made for any work that does not comply with the contract terms. The consultant cannot

proceed with his/her assignment until they have executed and returned the contract. The

contract process commits funding on the part of the Department. Work done without a

contract in place is strictly at the risk of the consultant. The Department does not recognize

oral contracts.

B. Consultant Payment Request Process

The consultant specialist will utilize an official NJDOT payment voucher (invoice) when

submitting a request for payment. Typically, consultants submit a signed invoice for

payment when conveying the initial report. The invoice will not be processed until after

the initial review process is completed. Partial payments are not made EXCEPT where the

contract stipulates otherwise or where the assignment is cancelled prior to completion and

the partial work is to be paid for or where technical corrections are made and a

supplemental fee is to be paid. Testimony services are generally billed separately from

the fee contracted for the valuation/NRE service at the rate set forth in the contract.

C. Quality of Submitted Report

All paper versions of reports submitted by a valuation or NRE specialist must be properly

bound, signed, and submitted on 8.5 x 11 inch high quality white paper. Maps larger than

8.5 x 11 may be included if folded to fit within the report. Exhibits are to utilize color

photos and color IPM or acquisition maps (except where only a tax map is used as the

acquisition map). Reports must be permanently and neatly bound and must reflect a

professional quality report. Since these bound copies will be used in negotiations and/or

court proceedings, the report must be presented in a professional manner that reflects

positively upon the specialist and NJDOT. Reports submitted electronically will likewise be

8.5 x 11 inch in size for the text portions, signed and submitted as a PDF file with all

attachments included as for a paper report (maps within PDF may exceed 8.5 x 11).

D. Valuation and NRE Service Obligations

The service provider is expected to be completely familiar with and responsible for any

reports submitted. While the person performing the report may have assistance from

colleagues or employees, the final work product must be that of the service provider. The

Division must be able to rely upon valuation and NRE reports for testimony purposes.

Therefore, the use of sub-consultants or employees to prepare reports as the primary

provider is unacceptable due to the loss of credibility in the work product and testimony of

the valuation or NRE service provider. An individual service provider who is contracted

through a firm is considered to be the service provider for that contract. The firm in

accepting the contract is obligated to provide the approved service provider and may not

substitute without permission from the Division. In the event that the service provider

leaves that firm, the Division as a result of the contract may hire the service provider to

complete work, including as yet unordered update work.

2.5.1 Date of Valuation & Date of Report

The Date of Valuation is normally the same date in both the before condition and the after

condition valuation. The Division will notify the appraiser if a date different from the

general rules below would apply.

A. Pre Condemnation Reports

Date of Report: The date of the report is the date that the expert prepares the report.

Date of Valuation: Prior to condemnation, the date of valuation will normally be the date

that the expert last inspected the subject property unless otherwise instructed.

B. Post Condemnation Reports

Date of Report: The date of the report is the date that the expert prepares the report.

Date of Valuation: The Litigation Support Unit will provide the expert with the appropriate

date of valuation. Normally, the date on which the condemnation complaint was filed

in the Superior Court is the applicable date of value sometimes also called the “as of date”.

(N.J.S.A. 20:3-30 states in part: “Just compensation shall be determined as of the date

of the earliest of the following events: (a) the date possession of the property being

condemned is taken by the condemnor in whole or in part; (b) the date of the

commencement of the action; (c) the date on which action is taken by the condemnor

which substantially affects the use and enjoyment of the property by the condemnee…”)

2.5.2 Benefits Resulting from a Project

Benefits may accrue to a property owner as a result of a transportation project. Under

New Jersey law, the valuation of property in a partial taking requires consideration of all

“relevant, reasonably calculable, and non-conjectural factors that either decrease or

increase the value” of the remainder property. Harvey Cedars v. Karan, 214 N.J. 384, 389

(2013). Benefits may be considered to reduce the damages element of the just

compensation but do not offset the value of the fee acquisition. Benefits are case specific,

such as providing a highway frontage to property that was landlocked before the project.

If the appraiser believes that a particular acquisition presents a benefits issue, the Realty

Specialist 4 or Litigation Support Specialist working with the appraiser should be contacted

to determine if legal advice is necessary. Market value changes as a result of Project

Influence are discussed in Section 2.6.10.D.

2.5.3 Fixtures/Personalty & Functional Unit Items

An owner may not be compensated for items of personalty; however, she/he is entitled to

payment for enhancement of the real estate as a result of the presence of “functional unit

items.” An item assumes this status when the real estate with which it is associated is

enhanced beyond the salvage value of the item in question. A building and an item within

it form a functional unit when the difference between the value of the building with the

item and without it is substantial.

Additionally if required in the appraisal Scope of Work a realty/personalty report will be

prepared by the appraiser [Section 24.103(a)(2)(i)].

Functional unit items must be an “integral or essential part” of the building. This means

the item is incapable of removal without material injury to itself or the real estate; or is

specifically adapted to the purpose of the improved realty and is not capable of use

elsewhere and would substantially lose all value if removed.

If there are a significant number of functional unit items, a specialist report may be

obtained for their valuation. If there are only a few such items, they may be valued by

the appraiser. The appraiser or NRE specialist should not include any items that are

already included in the base cost of the building classification selected by the appraiser,

such as wall outlets in a wall. Questions regarding the treatment of functional unit items

should be brought to the attention of the Division.

2.5.4 Highest and Best Use and Fair Market Value

The New Jersey Supreme Court definition of Highest and Best Use is set forth below, this

definition is to be incorporated into all appraisal assignments unless a different standard

has been agreed to by NJDOT. When preparing the appraisal, it is important that all four

criteria are addressed. The appraiser must explain how each of the four criteria has been

applied to the particular case.

"Highest and best use" is defined as that use of the property which is "1) legally

permissible, 2) physically possible, 3) financially feasible, and 4) maximally productive.

Hous. Auth. of New Brunswick v. Suydam Investors, 23 N.J. 2 (2003)

Citing County of Monmouth v. Hilton, 334 N.J. Super. 582, 587 (App Div. 2000), certif.

denied, 167 N.J. 633 (2001).

If a property’s highest and best use is determined to be other than as zoned or based on

the reasonable probability of a zoning change or variance, site plan approval or subdivision

approval, the conclusions regarding an as yet unrealized highest and best use must be

supported and not based on mere speculation.

“Reasonable probability” is the standard for determining whether or not a potential zoning

change or variance, site plan approval, or potential subdivision approval can be considered

to affect the value. The factual detail required to support a finding of reasonable probability

of subdivision approval increases significantly for a major versus a minor subdivision. Site

plan approval obtained prior to the date of valuation must relate to the condition of the

property as of the date of valuation in order to be considered.

If a potential zoning change or variance is found to be reasonably probable, the property

may be valued as zoned, with an increment, if any, that the market would recognize for

the reasonable probability that the property would be rezoned in the future; or valued as

rezoned, with an appropriate deduction to reflect the fact that the zoning change or

variance has not or may not occur.

Likewise, if a change in use is part of the highest and best use, the appraiser must consider

the risks inherent in making the change, including any costs required to create that change

and the time value of money during the period needed for the change to occur. The

appraiser cannot simply create that change as an extraordinary assumption.

For the purpose of preparing an appraisal for New Jersey valuations, the appraiser should

use the following language as the Fair Market Value definition: Fair Market Value is "the

value that would be assigned to the acquired property by knowledgeable parties freely

negotiating for its sale under normal market conditions based on all surrounding

circumstances at the time of the taking." State v. Silver, 92 N.J. 507, 513-14 (1983).

This definition results in a Market Value opinion as set forth in the current version of USPAP

Definitions section. When using this definition in an appraisal, the “normal market

conditions” of sale or lease are to be cash or cash equivalent, and are to include exposure

in a competitive market for a reasonable time prior to the sale or lease and that the parties

are both knowledgeable and acting without undue motivation. The Fair Market Value is to

be based on the Highest and Best Use as of the date of valuation.

Where the UASFLA standards need to be used for an appraisal in a case where the property

was acquired with federal funding and the funding agency requests a UASFLA valuation,

the appraiser may substitute the Fair Market Valuation applicable to that limited

assignment. However, if the case may involve condemnation, a valuation based on state

standards will also be needed in order for the case to be accepted in the New Jersey courts.

2.5.5 Compensability of Damages

In eminent domain, or condemnation proceedings, the terms "damages" or "severance

damages" are a legal term of art that means a compensable loss of real property value

that the remainder of a partial acquisition suffers as a result of the State's acquisition of

property rights from the subject property (the acquired property) or as a result of the

State's use of the acquired property. Damages must be in some way measurable and must

also be compensable in order to be part of the valuation process. While market data may

indicate a remainder suffers a loss of value as a result of a partial acquisition, that alone

is not sufficient to establish that a remainder has been cognizably "damaged" by the partial

acquisition. It is essential to bear in mind that not every loss of value resulting from the

State's acquisition of property is compensable, however real that loss of value may be.

An acquisition may cause a loss of value to the remainder in two ways. Firstly, if the

acquired property supported a valuable use of the remainder which the remainder alone

could not continue to completely support, then the value of the remainder will be

diminished by the reduction in its utility. That loss of value probably constitutes damages

to the remainder. Secondly, if the State's use of the acquired property impairs a valuable

use of the remainder, then the value of the remainder may be diminished by the

impairment of the use. The law on the compensability of the latter type of loss of value is

still evolving. Such a loss of value may or may not constitute damages.

If there is a loss of value to a remainder that is not caused in one of the two described

ways, it is not compensable in a condemnation action. If a loss of value is not compensable

under the applicable law, it does not constitute "damages." If unsure about the

compensability of any loss of value, ask for clarification from the Realty Specialist 4 or

Litigation Support Specialist and if necessary the assigned DAG. In summary for purposes

of this section, a loss of value to a remainder may be compensable, may constitute

damages, only if it results from the remainder's loss of the acquired property or from the

State's use of the acquired property. If the loss of value is compensable, those damages

are an element of the just compensation due a property owner in the acquisition process

or subsequent condemnation proceeding. Listed below are potential damage sources and

a discussion of their compensability.

A. Location of Source of Loss of Value

A property owner is not entitled to compensation in a condemnation proceeding for any

loss of value caused by (1) the State's acquisition from a property other than the subject

or (2) the State's use of property already owned by the public. For instance, a loss of

value allegedly caused by the State's interference with the subject's use of parking spaces

located on public property is not compensable. Similarly, a loss of value allegedly caused

by the State's interference with the subject's use of public property to maneuver into and

out of parking spaces located on the subject is not compensable. The subject never

included a property right for such uses, so the State acquired no property right from the

subject by preventing such uses. Two other examples of losses of value that are not

compensable follow: (1) a loss of value allegedly caused by construction of a sound wall

on property other than the subject and (2) the regulation of access points, or driveways,

on properties other than the subject that the subject has no legal right to use. However,

if any portion of a sound wall is constructed on the acquired property and market data

establishes that the portion of the wall constructed on the acquired property actually

causes the remainder to suffer a consequential loss of value, that loss of value might be

compensable. In short, to be compensable a loss of value must result directly from the

loss of the acquired property or from what is constructed on the acquired property. In

each case, the State's acquisition of property from the subject would be the provable cause

of the loss of value to the remainder.

B. Access

Every property in the State of New Jersey located on a highway has a presumptive right

of vehicular access. This right is a property right, but it is not absolute. Ingress and egress

to a property along a State Highway is controlled pursuant to the State Highway Access

Management Act (Access Act) and the State Highway Access Management Code (Access

Code). An owner of land abutting a highway is not entitled to access at each and every

point along the boundary, but only to reasonable access to the general system of streets

and highways.

When the State plans a highway improvement project, it determines what access points

(driveways) will be permitted to exist after the project is completed. The Office of Access

Design, Division of Right of Way and Access Management (OAD), regulates access points

by exercising the State's police power pursuant to the Access Act and the Access Code,

not by exercising the State's power of eminent domain. Eminent Domain is only invoked

to the extent that the proposed driveway change requires the payment to the owner for

the temporary occupation of the property to institute the driveway and parking lot

restoration needed to implement the change. This is handled as an “S” Site Mitigation

Parcel. The acquiring of a temporary right to perform the actual driveway construction is

a separate activity from the police power which was employed to change the driveway

configuration.

The police power and the power of eminent domain are fundamentally different, and the

exercise of each has vastly different consequences. The significance of the difference

cannot be overemphasized. It is a difference in kind, not merely degree. Most importantly

for this discussion, a loss of value caused by an exercise of the police power is not

compensable in a condemnation action. Generally, a loss of value caused by an exercise

of the power of eminent domain is compensable, while a reasonable exercise of the police

power is not compensable. Another example of the use of police power, which is generally

not compensable is the downzoning of a property. In both cases, so long as reasonable

value remains to the property, the change is not compensable.

Hence, an appraiser should not consider any loss of value caused by an exercise of the

police power, including the power to regulate access points, in opining on the value of the

subject either before or after the State's highway project. (Marlton Plaza) To avoid

attributing value to the State's exercise of its police power pursuant to the Access Act and

the Access Code, the appraiser should value the subject as if it had the same access after

the State's highway project as it did before the State's highway project. If an appraisal

used the access to be provided after completion of the project when opining on a subject's

value it might depress both before and after subject values, thereby inappropriately

reducing the determination of just compensation.)

Further, effects the highway project may have on access to a property without touching

the property are the result of the exercise of the police power. Any loss of value

attributable to such effects, however demonstrable with market data, is not compensable.

For example, loss of value to the subject caused by circuitry of travel, diversion of traffic,

or the creation of a connector or frontage road providing access to the property are not

compensable. Whenever a question of compensability for access arises, a DAG should be

consulted if the question cannot be resolved by NJDOT staff.

1. Access Process - When OAD alters access points of a property pursuant to its regulatory

authority, it determines what access points will be permitted and it determines whether

those access points (1) will provide reasonable access to the general system of streets

and highways and (2) will satisfy the legal standards, requirements, and criteria for

alternative access to the property, given its class (commercial, industrial, residential or

agricultural). Those criteria are set forth in the Access Act and Access Code. If the

access points to be permitted satisfy the criteria, the access alterations were affected

by the State's exercise of its police power and any loss of value caused by the access

alterations are not compensable. OAD must make the determination whether the

altered access satisfies the legal criteria. If OAD has not done so prior to

commencement of the acquisition process and the plans show that the access points

will be altered, the matter must be referred to OAD.

Prior to the initiation of the acquisition process OAD will determine whether the

proposed altered access points will satisfy the legal criteria for alternative access. Time

permitting; the appraiser will be provided with OAD's determination, which should be

incorporated into the appraisal. Where time does not permit, the appraiser may be

asked to assume that the matter is resolved and value the property accordingly.

2. Denial of Access through Eminent Domain - If the proposed alteration of access cannot

meet the criteria of the Access Act and Access Code, the State may have to acquire

part or all of the access property rights through the exercise of its power of eminent

domain. Such an acquisition is called a denial or partial denial of access. An example

of a potential partial denial of access would be an access alteration that precluded entry

to certain delivery vehicles that previously could enter and circulate on the property in

support of its existing development. Though the property would still have access, its

diminution in value, if any, might be compensable. In such a case, the appraiser will

have to determine the value of the property before the access alteration and after it.

The appraiser should not assume that the after value will be lower than the before

value.

In cases in which OAD has not processed the access alteration administratively, the

matter must be referred back to OAD for its determination prior to commencement of

the appraisal assignment. The appraiser must not make the determination as to the

reasonability of the altered access or whether the altered access satisfies the legal

criteria. Never assume that alternative access satisfying the legal criteria cannot be

provided and that any loss of value resulting from the alteration of access demonstrable

with market data is therefore compensable. OAD must make any determination that

alternative access satisfying the legal criteria cannot be provided. The District Program

Manager and if necessary the District assigned DAG should be contacted for additional

information or clarification about the compensability of losses of value attributable to

an access alteration.

Properties not located on highways, while not subject to the State Highway Access

Management Act, may still be subject to non-compensable access restrictions as an

exercise of police power under common law or local regulations or ordinances.

Compensability of such changes must be investigated before damages are assigned in

an eminent domain appraisal.

2.5.6 Business Losses

Loss to, or destruction of good will, loss of profits, inability to relocate or frustration of

plans are not compensable. Likewise, loss of a franchise is not compensable. However,

under the unique situation where a temporary taking of an entire property shuts down a

business for a finite period of time, loss of profits and goodwill are compensable (Arifee).

The owner shall be responsible for providing the Department with adequate documentation

of such losses. Compensability for business loss does not apply to short term temporary

closures such as driveway work resulting from construction activities, however the owner

is entitled to the ground rental value of the land occupied during the time the Department

is constructing on the property.

2.5.7 Changes in Grade

A change in grade between a property and an abutting roadway is not compensable, unless

it deprives a property of reasonable access. (See previous comments on access). If a

change in grade causes specific conditions on a property, those conditions may result in

compensable damages. For example, the slopes required to support the new roadway

grade are so intrusive as to prevent either the use of existing parking spaces or an effective

mitigation elsewhere on the site.

2.5.8 Drainage

If drainage damages result from NJDOT’s use of its own upland property, the damages are

only compensable if the adjoining property is impacted such as through flooding or the

creation of wetlands or wetland buffers that extend beyond NJDOT’s property into the

adjoining property. If the drainage damages result from NJDOT’s use of the acquired

drainage rights for NJDOT improvements impact the adjoining property, they are

compensable such as installation of a drainage pipe, which places a significant amount of

new water flow onto the adjoining property. NJDOT has an obligation to address flooding

on the adjoining lands which is a direct result of changes in the roadway. Typically this

will be done by providing the adjoining property with new inlets, ditches or other grading

to restore existing conditions.

Drainage rights needed to serve the highway will have drainage easements, those required

to restore the drainage on an adjoining property will be temporary construction or site

mitigation. The owner will be required to do routine maintenance, however NJDOT would

restore the physical drainage structure if required due to collapse. Thus, drainage

improvements by NJDOT which benefit the owner alone require only a temporary right to

enter with a rental payment.

2.5.9 Noise

Typically, noise impacts are speculative, in that they are projected to occur at some point

in the future and generally arise from the overall project, not from the taking from the

specific property. The District Program Manager should be notified if the appraiser believes

that the noise impacts in a particular case are specific to the property, the noise levels are

measurable and the market impact is quantifiable, otherwise damages attributable to

increased noise is not compensable.

2.5.10 Landscaping / Crops and Sand Deposits

Trees, topsoil and other landscaping elements are part of the land and should not be valued

separately unless part of a plant nursery business. In the event that the trees are replaced

by NJDOT, that should be noted and no compensation is warranted. The loss occasioned

by the taking of these elements, if any, can only be considered to the extent that the value

of the land was enhanced by their presence before taking and diminished by their absence

after taking (see generally Tennessee Gas Transmission Co. vs. Maze 45 N.J. Super. 496,

503. Sand deposits on a non quarry property should be treated in a similar manner

wherein their value is the value added to the Property.

A separate payment is authorized by the N.J.S.A. 20:3-29.1 for loss of income resulting

from the interference with the harvesting of any standing crops or other agricultural

commodities on farmland assessed property. Additional guidance is found at 2.9 Standing

Crop Valuations.

2.5.11 Visibility

Compensation is required for the diminution in the value of the remainder of the property

that is specifically attributable to loss of visibility as a direct result of the acquisition of a

portion of the property. In order to be compensable, the loss of visibility must result from

the partial taking itself, or what is done on the partial taking. The loss of visibility must

be “actual and specific” to the remainder of the property and must result in damages that

are not speculative, but rather specific to the property and quantifiable by objective market

data.

The construction of an overpass on lands contiguous to, but not on, the acquired property

should not result in damages, even though the overpass obstructs the view from the

highway to the commercial property, since the loss does not result from the taking. The

loss of visibility for a large tract of residential land, the utility of which is not dependent

upon highway view, may not result in damages; conversely, the loss of visibility to an

improved commercial property that will result in increased advertising costs to maintain

the highest and best use, will likely result in damages. The appraiser, through the District

Program Manager, should consult with the Project Manager regarding sight distance and

other related issues and the Division of Law, Transportation Section contacted on

compensability issues.

Unity of Use / Ownership

Two or more properties should be valued together, regardless of whether they are

contiguous if: (a) the properties are functionally integrated, each being reasonably

necessary to the use and enjoyment of the other; and (b) the properties are under

substantially the same ownership. Two separate properties with the same ownership but

with different highest and best uses can still be appraised in one appraisal provided that

two separate values are determined by the appraiser.

Where there are partial acquisitions of two separate properties before and the appraiser

believes that the highest and best use of the two properties after would be in combination,

the combined value of the two remainders can be considered. The combination of the two

properties must be reasonably probable and there must be a common ownership of the

two properties.

The appraiser should notify the District Program Manager for a review of any unity of use

issues from a legal standpoint with the DAG assigned to the District office.

2.5.12 Limits of Grading

Limits of grading rights are temporary in nature and their purpose is to permit entry in

order to re-grade the property. The right terminates after the work has been completed.

2.5.13 Easements in General

In valuing easements, appraisers should consider the impact to the property and not just

a simple percentage adjustment. For instance, a slope easement on a hilly parcel may

actually improve the grade and utility of the property. Conversely, replacement wetlands

may create a buffer impact beyond the easement limit. The appraiser must also avoid

paying more than fee value when more than one easement overlaps another easement.

The appraiser must also note the existence of existing easements and account for them in

the valuation process. Existing easements should be treated consistently with the way

new easements are treated. It is improper to provide damages for new easements while

ignoring the impacts of existing easements. The appraisal must also consider existing

easements within proposed fee parcels. If the appraiser determines that an easement will

create an unexpected and significant impact on the property related to parking or another

loss of utility, the Realty Specialist 4 should be notified to determine if some alternative is

possible or if an NRE is required.

Improvements located in easements which will physically reshape the land (slope, ditch,

bridge, etc.) will usually need to be removed. If displaced improvements are not to be

relocated and are not replaced in kind by NJDOT, they must be compensated for in the

appraisal. The appraiser should be certain of the impacts of each type of easement to

determine which improvements will remain in place and which need to be relocated or

acquired and valued in the appraisal.

A. Slope Easements: Slope easements are permanent; however, a slope does not

necessarily preclude an owner from installing improvements in the area once

construction is complete, as long as the integrity of the slope is maintained. The

appraiser should discuss with NJDOT what items can remain within the slope and what

items might be allowed within the slope in the future. If there is an existing slope

easement on property that is being acquired in fee, the improvements to be removed

from the easement area must be addressed in a similar manner.

B. Valuations of Temporary Easements. These are typically based on rental rates

which are derived from ground lease market data, and consideration of the proposed

time frame of the easement. When ground rent comparables are not available, the

appraiser will need to estimate a market ground rent based upon available market data.

C. Valuation of Servient Estate Parcel and Dominant Easements. A Servient Parcel

is a fee parcel with reduced ownership rights due to the overlap of a Dominant

Easement. A Servient Parcel may have a reduced value where a pipeline or other use

reduces the utility of that fee parcel. Alternatively, cross easements may have a neutral

impact. The appraiser should consider the impacts to determine if a reduction in fee

parcel value for the Servient Parcel is applicable. The Dominant Easement gives

another entity a right of use. A prime example would be an access right to cross one

house lot to get to a rear property. Under normal circumstances, the value of a

Dominant Easement is found not in what it subtracts from the Servient Parcel, but in

what it adds to the holder of the Dominant Easement. If an access driveway is

shortened but otherwise remains open, the Dominant Estate probably does not lose

any value, and may theoretically benefit from reduced costs to maintain the driveway.

If the acquisition from a Dominant Estate is not allowed to function, such as where a

driveway is closed, than the Dominant Estate value is the value of the rear property

which is now landlocked. When a dominant easement is no longer used, such as a

ditch easement where the easement remains but the ditch was relocated, the Dominant

Easement no longer adds direct value to the holder of the easement, however, as it is

still a cloud on the title, its value may be what the underlying fee owner might pay to

release the easement, rather than its contributory value to the easement holder.

2.5.14 Encroachments

If the appraiser identifies a potential encroachment caused by the acquisition, such as a

building or a large sign base located on the remainder with a portion of the sign or building

overhanging the new right of way, the Realty Specialist 4 or Litigation Support Specialist

should be notified so that a determination can be made as to whether the encroachment

must be removed and compensated for (if not in original right of way), or addressed in

some other manner. The most common encroachments are signs and lighting.

Existing encroachments which are partly or entirely within the existing right of way are

normally not included in the valuation process. If there are questions on how to treat

them, the Realty Specialist 4 or Division appraisal staff should be consulted.

2.5.15 Environmental Conditions (Other Than Contamination) and Valuation

The presence of wetlands is to be considered like any other natural condition affecting

value, such as topography. Environmental regulations affecting value, such as Pinelands,

Highlands, CAFRA, Stormwater and Freshwater Wetlands regulations, must be considered

and discussed in the valuation process.

2.5.16 Contaminated Property and Valuation

Property should be appraised as if it is “remediated and available to its highest and best

use” unless otherwise stipulated in the assignment. The statement regarding the

remediated value should appear in the appraisal and be noted as a hypothetical condition.

For appraisal purposes, the remediated value considers the site as being available for its

highest and best use. The determination of highest and best use is subject to the physical

limitations created where contaminated material is approved to be left in the ground. For

instance, an industrial site with contamination left in the ground when remediated to the

industrial level might be a typical condition for the area and may require no adjustment.

There are two main considerations when valuing the site as if remediated. The first is to

ask if the market data identifies a difference in value due to a stigma factor that the

appraiser can quantify from market data. Where there are transactions of similar

contaminated property, than stigma is built into the market data for the comparable

contaminated property. If the site is in an area where there are no similar contaminated

comparables, the appraiser’s opinion as to any stigma must be clearly supported through

market analysis. Where insufficient data exists, the appraiser must not simply render a

judgment about potential stigma as an estimated adjustment.

The second consideration to valuing as if remediated is found where there are

extraordinary costs to develop the site versus a typical site due to residual contamination

issues such as capping requirements. Where such expenses are similar for the subject

and comparables, the market data may require no adjustment. A prime example is the

redevelopment of a landfill. The costs to compact the site so that buildings don’t sink

would have to be taken into account in any development. Another example where

extraordinary costs might apply would be if a contaminated site were proposed for

development as an apartment site. If the site cannot be remediated to residential

standards, contamination above those standards would remain in the ground. The cap on

the site would limit development potential because it would require a slab foundation which

can increase costs compared to other available unconstrained sites. An apartment building

over a capped site may display some market evidence of stigma as well.

The appraiser must discuss in the report remediation conditions and their impact on the

highest and best use analysis and the availability or lack thereof of market data to support

a stigma impact on the property.

2.5.17 Mitigation of Severance Damages / Replacement Property

Where a potential mitigation of severance damages is possible, appraisers should value

the remainder without any replacement property. If the potential replacement does result

in a reduction in economic severance damages, the appraiser should also value the

remainder with the replacement property as a separate analysis. Offset of the acquisition

damages is considered by analysis of this situation. For those cases requiring NRE reports,

alternatives with and without the replacement property should be provided. Care must be

exercised to ensure that site improvements included in any proposed mitigation are not

also compensated for as part of the acquisition.

2.5.18 Tidelands

Appraisal reports should consider properties with formerly flowed claims as if the claims

do not exist for valuation purposes. The appraiser should value areas with claimed land

simply as part of the overall tract. The Tidelands Resource Council (TRC) will utilize the

claimed land area shown on the maps and the unit rate from the appraisal to determine

what they will charge the owner to clear the claimed portions of the parcel. Lands below

the Mean High Water Line (MHWL) are normally valued by the TRC. This methodology is

subject to changes by the Tidelands Resource Council, and may not apply where the

Department is working in very high value locations, or constructing docks or other

nontraditional uses. The appraiser should verify the types of sales needed before

proceeding with the assignment.

2.5.19 Green Acres and Farmland and Conservation Restricted Lands

In general, these properties are valued at the highest and best use as if the restriction was

not present to allow for replacement land purchase of other non-restricted land.

Often Green Acres restricted lands are down zoned to Park or Conservation. The appraiser

should consider other properties in the area and determine what the subject property

would most likely have been zoned if it had not been restricted. Green Acres properties

may involve a carve out to a more representative market size if the acquisition is small

and of minor consequence to the greater property.

2.5.20 Verification of Comparable Sales, Competent Knowledge Required

N.J.S.A. 2A:83-1 provides in part that “any person [appraiser] offered as a witness in any

such action or proceeding shall be competent to testify as to sales of comparable land,

including any improvements thereon, contiguous or adjacent to the land in question, or in

the vicinity or locality thereof, or otherwise comparable, from information or knowledge of

such sales, obtained from the owner, seller, purchaser, lessee or occupant of such

comparable land, or from information obtained from the broker or brokers or attorney or

attorneys who negotiated or who are familiar with or cognizant of such sales, which

testimony when so offered, shall be competent and admissible evidence in any such action

or proceeding.” Appraisers must properly verify with the correct parties set forth above

to verify that the transaction occurred, and the terms under which the transaction

occurred. The use of the assessor or public records is not sufficient for either the

Department or for USPAP compliance. On occasion, as an additional sale, other sources

can be used, but disclosure is required that the comparable was not fully verified and that

the appraiser is not relying upon that comparable.

2.6 Appraisal Requirements and Standards

This section contains information about performing appraisals.

2.6.1 Appraiser Qualifications

Staff appraisers and Staff Review Appraisers shall hold the New Jersey State Appraisal

certifications required by State law and consistent with the type of property being valued.

Consultant appraisers shall be State General Certified or Residential Certified in accordance

with New Jersey State law and Division policy and must hold the designation required to

perform the work they accept from the Division. The Department will add consultants to

its list based upon the experience, education, training, certification/licensing,

designation(s) and other qualifications necessary to provide the required service.

Consultant appraisers are retained directly by NJDOT and are required to personally

perform the contracted services; subcontracting is not permitted unless specifically

authorized by NJDOT. If the contract is with a partnership or corporation, the contract

shall identify the persons who will render the valuation services. This does not prevent an

appraiser from using her/his staff to assist, providing the appraiser personally attends the

property inspections and actually produces the appraisal report and value estimate. The

contracted appraiser must be present at the mandatory inspection of the owner’s property

to comply with the Eminent Domain Act. This inspection cannot be delegated.

2.6.2 Information to be Furnished to Appraisers

The appraiser is to be provided with the Individual Parcel Map (IPM) or other map

designated for the acquisition of the subject as well as information relative to the

interpretation of State law concerning non-compensable items, determination of realty vs.

personalty and the treatment of benefits. If the acquisition is partial, the appraiser will be

provided with information relative to the nature of the proposed highway construction and

remaining areas.

In those instances where the appraiser feels that she/he is capable of completing the

appraisal assignment without cross sections and profiles, or any other essential part of the

final geometry, the appraisal of the partial acquisition may proceed. If the appraiser

requires additional construction related information in order to properly assess the impact

of the acquisition upon the remainder, the matter shall be brought to the attention of the

District Program Manager for a decision as to whether the appraisal should be placed in a

hold status pending availability of the construction details.

Where an approved cost to mitigate report(s), NRE and/or Access Impact Assessment

report is obtained, the appraiser will be provided with copies.

A. Maps and Map Errors or Omissions

 Unless otherwise specifically directed, all appraisals shall use the ownership, area,

property dimensions, building locations, access rights, parcels and easements as

shown on the IPM or other map designated for use in the assignment. In considering

the maps, the appraiser is reminded to use an extraordinary assumption to treat

the after condition on partial acquisitions as if it has in effect occurred, for the

purpose of determining the after value of the property. The appraiser should note

that the IPM or other maps provided by NJDOT may be approximate as to building

dimensions because they are based in part on aerial photography, which does not

take into account any roof overhangs in the plotting of the building dimensions.

Thus, if a building or other improvements are a significant part of the valuation or

mitigation, the NRE specialist must use the proper techniques to measure the

building or site improvements in order to determine their correct dimensions. Where

a building is or should be valued, the appraiser must provide the measurements in

a property sketch on any acquisition where the value of the building is required or

given significant consideration.

 If the appraiser finds plan errors/omissions, she/he should notify the District

Program Manager or Realty Specialist 4 or the assigned Litigation Coordinator before

proceeding with the appraisal. The Realty Specialist 4 or once in condemnation, the

Litigation Support Coordinator is responsible for the liaison with the CPM Project

Manager for clarification and/or correction of any errors or omissions and to provide

the appraiser with any corrected or revised plans.

2.6.3 Submission and Review of Appraisal

The appraiser will submit a properly signed version of his/her report, either as a bound

paper copy, electronically or both in accordance with the contract specifications and

requirements set forth in this manual. All initial reports are considered to be draft but must

be properly signed and ready for use in the event that there are no corrections needed. If

the report is acceptable, the draft will become the final version and the appraiser will be

requested to forward properly bound paper copies of the report to the person requesting

the appraisal service as set forth in the contract.

2.6.4 Delivery and Review of Appraisal Addenda

In the event that corrections are requested to the appraisal, the appraiser will resubmit an

updated version of his/her report as a PDF with the necessary corrections. Upon final

concurrence, the appraiser will be advised to forward the number of properly bound paper

copies of the final version of the report noted in the contract to the person requesting the

appraisal service.

2.6.5 Appraisal Testimony

Appraisers are expected, as part of their contract terms, to be available to testify in

commission hearings, and, if necessary in court on the contents of their reports.

2.6.6 Ethical Standards Regarding Valuation Services

 The appraiser, review appraiser or person performing the waiver valuation shall not

have any interest, direct or indirect, in the real property or personal property being

valued. [49 CFR Section 24.102(n)(1)] If known prior to accepting an assignment,

and/or if discovered at any time during the assignment, an appraiser (or other

person performing a valuation) must disclose to the Division, and in the subsequent

report certification: any current or prospective interest in the subject property or

parties involved (owners, tenants or representatives); and any services regarding

the subject property performed by the appraiser (or valuation provider) within the

three year period immediately preceding acceptance of the assignment, as an

appraiser or in any other capacity. [USPAP] Casual business dealings, such as

purchases at a Wal-Mart are not an interest contemplated by this requirement.

 In the event that a potential conflict is discovered in the course of performing the

assignment, the person performing the valuation service must contact the Division

as soon as she or he becomes aware of the potential conflict.

 The Division reserves the right to determine what, if any level of actual or potential

conflict of interest can be accommodated.

 Compensation for making an appraisal shall not be based on the amount of the

valuation estimate. [USPAP, 49 CFR Section 24.102(n)(1)].

 No person shall attempt to unduly influence or coerce an appraiser regarding any

valuation or other aspect of an appraisal, review or waiver valuation. Supervision of

appraisal staff shall reflect the requirement as set forth in 49 CFR 24.102(n)(2)

 The valuation specialist must conduct his/her work in accordance with the highest

ethical standards and must not have been convicted of a crime of moral turpitude.

 Consultant valuation specialists must be in compliance with all State laws,

regulations and Executive Orders regarding eligibility for work as a consultant with

the State of New Jersey.

 Consultants must understand and abide by the requirements set forth herein.

 When working with a reviewer, the appraiser should recognize the purpose of the

review is to ensure compliance with legal requirements and to help in the delivery

of a credible report. The relationship should be professional not be adversarial and

the appraiser should give reasonable consideration to suggestions or concerns put

forth by the reviewer.

2.6.7 Ownership of Report

Appraisal, appraisal review and ADV reports and work product submitted to NJDOT become

the property of NJDOT and once delivered shall be retained by NJDOT and are subject to

public disclosure in accordance with New Jersey law.

2.6.8 Report Corrections, Revisions, and Additions

When a correction or revision is necessary, the appraiser shall furnish corrected, revised

or supplemented pages or portions of the report for attachment to the copies already

delivered if paper reports were submitted, or complete revised reports if an electronic

version of the report was submitted. Changes to the report initiated by the appraiser must

be delivered through regular channels and accepted by the Division as a formal revision of

the original report.

2.6.9 Regulatory Requirements and Standards for Valuation Reports

All appraisal and appraisal review assignments are required to conform to the Appraisal

Foundation’s Uniform Standards of Professional Appraisal Practice (USPAP) unless a

particular requirement is contrary to a law, rule, regulation or court decision, in which case

a Jurisdictional Exception to USPAP would apply. In addition, reports must also comply

with governing statutory, regulatory requirements and court decisions of the State of New

Jersey, the federal Uniform Relocation Assistance and Real Property Acquisition Policies

Act of 1970 (URA) along with its implementing regulations and any relevant federal court

decisions. The Department utilizes the URA valuation requirements on all projects

regardless of the source of funding. Local Aid funded projects whether federally or NJDOT

funded are expected to conform to the requirements set forth in this manual.

A. Uniform Relocation Assistance & Real Property Acquisition Policies Act (URA)

It is the intent of NJDOT that this Manual be in compliance with the applicable elements of

the Uniform Relocation Assistance & Real Property Acquisition Policies Act of 1970 (URA)

and its implementing regulations at Title 49 CFR Part 24. Federal regulation 49 CFR

24.103(a) delineates appraisal requirements for projects that have federal funding in any

part thereof. Although these appraisal requirements are considered to be compatible with

USPAP, should a conflict occur on a Department project or on a federally or NJDOT funded

local aid project, the URA requirements and any applicable New Jersey statutory,

regulatory and policy requirement would take precedence over USPAP. Where a conflict

with USPAP occurs, the appraiser must use the Jurisdictional Exception provision of USPAP

to remain compliant, noting specifically the element of law or regulation which requires the

deviation from USPAP.

The URA regulatory and other appraisal requirements are summarized as follows:

 URA, USPAP, AND UASFLA – The URA sets forth the requirements for real property

acquisition appraisals for Federal and federally-assisted programs. Appraisals are

to be prepared according to these requirements, which are intended to be consistent

with the Uniform Standards of Professional Appraisal Practice (USPAP) [See URA

regulations at Appendix A, § 24.103(a)].

In some cases, property owned or funded by federal agencies may require the

incorporation of the Uniform Appraisal Standards for Federal Land Acquisition (UASFLA).

The UASFLA is published jointly by the Appraisal Institute and the Department of Justice

and is available online from those sources. The use of UASFLA standards is limited to

those lands where federal ownership or funding involvement requires it to be used. Since

portions of the UASFLA are relevant only under federal condemnation law and do not apply

under New Jersey statutes, use of the UASFLA is not authorized under any other

circumstances. If a condemnation in a New Jersey court is needed where a UASFLA

consistent report was prepared, the appraiser may be asked to provide a modified or

additional report reflecting New Jersey condemnation law. In the event of any questions,

the appraiser should contact the Division for clarification before concluding the report.

 Scope of Work - The NJDOT in 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 development of an

appraisal under these requirements depends on the complexity of the appraisal

problem. The report must meet the statutory and regulatory requirements in a

manner which will allow NJDOT to utilize the report in eminent domain acquisitions.

 URA Appraisal Standards - The NJDOT has the responsibility to assure that the

appraisals it obtains are relevant to its program needs, reflect established and

commonly accepted federally-assisted program appraisal practice, and as a

minimum, complies with the definition of appraisal as referenced in § 24.2(a)(3) the

five following requirements: (See URA Appendix A, §§ 24.103 and 24.103(a).)

 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, including a copy

of the last deed into the current ownership, location, zoning, present use, an

analysis of highest and best use, and at least a 5-year sales history of the property.

[See URA Appendix A, § 24.103(a)(1)].

 All relevant and reliable approaches to value consistent with USPAP and established

federally-assisted program appraisal practices. If the appraiser uses more than one

approach, there shall be an analysis and reconciliation of approaches to value used

that is sufficient to support the appraiser's opinion of value. [See URA Appendix A,

§ 24.103(a)].

 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.

 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.

 Arbitrary Breakdown The appraiser will provide a breakdown of the estimated just

compensation as follows: Land – Total value of all fee parcels acquired from the

property. Improvements – Value of all improvements or portions of improvements

which are located solely within the fee parcels. If a structure is only partly in a fee

parcel, then that percentage of the structure value in the fee parcel is ascribed to

Improvements and the remainder is added to Damages. Damages – Value of any

improvements or portions of improvements which are within easements, or

otherwise damaged by the acquisition and to be purchased; together with the value

of any easements; plus any severance damages and the amount of any rounding

differences. Total = Sum of Land, Improvements and Damages.

 The effective date of valuation, date of appraisal, signature, and certification of the

appraiser.

B. Uniform Standards of Professional Appraisal Practice (USPAP)

Where there is no federal or state law, rule, regulation, court decision or public policy to

the contrary, the Appraiser and Appraisal Reviewer will conduct all Appraisals and Appraisal

Reviews in conformity with the current Uniform Standards of Professional Appraisal

Practice (USPAP) requirements.

Where deviation from a USPAP standard is mandated by a specific law, regulation, court

decision or public policy, the Appraiser should note these as Jurisdictional Exceptions. A

method of appraising using a different set of valuation criteria is not typically considered

to be an exception so long as the assumptions are clearly stated. USPAP does not require

the use of a specific type of valuation, and valuations can take many forms, including value

in use, insurance value, etc. Some examples of special valuation considerations which

would not in and of themselves rise to the level of exceptions include:

 Valuation of a property where the driveway has been moved as part of an access

change to a side street which meets the Highway Access Code’s reasonable

alternative access test. In this case the appraiser would consider the property as if

access remained unchanged, ignoring any potential damages from the change even

though market research might indicate a change in the value.

 Valuation of a property without adding or subtracting changes in market value due

solely to general Project Influence (see Section 2.6.10 B).

The use of Jurisdictional Exemptions applies only when there is an actual deviation from

USPAP required by law, regulation, court decision or public policy.

The use of hypothetical condition and extraordinary assumptions must be fully discussed

and disclosed in the Scope of Work section of the report. Examples include:

 The Before and After Method where the after condition is assumed to have occurred.

If that scenario doesn’t occur, the valuation would be incorrect (extraordinary

assumption).

 Valuation of a contaminated site as if remediated even though that is not currently

the case (hypothetical condition as this is clearly false).

2.6.10 General Appraisal Standards

A. Purpose

This section defines the requirements, standards and format required in preparing

appraisal reports. It is expected that the appraiser will refer to these instructions as a guide

as to the minimum standards and acceptable format. All reports are to be prepared in

accordance with these instructions, unless it has otherwise previously been agreed upon

in the contract between the appraiser and NJDOT.

B. New Jersey Statutes, Regulations and Policy

Appraisal Requirements related to New Jersey statutes, regulations and court decisions

regarding real estate appraisals for transportation projects are presented throughout this

section. Appraisals must be independently prepared and each appraisal must be signed

by the individual(s) making the appraisal. The appraiser must possess the level of State

Certification necessary in order to perform the appraisal report.

Appraisals may not include any payment for relocation assistance or consider that such

payments will be made.

C. Subject Property Inspection & Owner Accompaniment

Both State law and federal regulations require that the owner or his/her designated

representative must be given an opportunity to accompany the appraiser during the

inspection of the property prior to the onset of negotiations. This gives the appraiser the

opportunity to discuss any information that the owner may have that could assist in the

valuation process.

The appraiser must notify the property owner in writing of the invitation to meet via

Certified Mail with a Return Receipt. The Appraisal must also include a copy of the

inspection letter and the Return Receipt. Because this is a statutory requirement, it is

critical that the appraiser utilize the correct mailing address. The invitation to meet and

the results of any contacts with the owner must be reported under Owner Contacts in the

Appraisal report. The Appraiser should alert the Division of any issues or questions raised

by the owner which would impact the valuation process or create an opportunity to reduce

or mitigate acquisition damages.

It is recommended that the appraiser carry a copy of the inspection letter and signed return

receipt on inspections. If the owner is not present, the appraiser should not enter any

buildings or spaces which would not otherwise be open to the public.

The appraiser must perform that level of inspection which results in a credible appraisal.

If an interior inspection is appropriate but cannot be conducted, the appraiser should note

that in the Owner contacts and make such extraordinary assumptions as are appropriate

to undertake a credible report.

The appraiser who is contracted to perform the assignment must participate in each

subject property inspection and cannot delegate this function. The appraiser must also

view the comparables as well. This is critical so that the appraiser fulfills the legal

requirements and can knowledgably talk about the property and the comparables in his/her

reports and testimony.

For condemnation updates, appraisers who have already appraised the acquisition for the

Division may elect not to conduct an onsite physical inspection if there are no substantive

changes to the property, but must at a minimum view the property from the exterior (road)

to determine if conditions have changed. This exterior inspection should be noted as such

in the owner contacts section. If in viewing the property the appraiser concludes that

significant changes have occurred, a new inspection may be necessary. In the event that

a physical inspection is appropriate during the condemnation phase, the appraiser should

consult the assigned Litigation Support Specialist to determine if an inspection letter to the

owner is still necessary. For partial acquisitions, only that portion actually acquired

(outside of a building) would be open to the appraiser, the remainder would still require

an inspection letter for a direct inspection. Even though the state may now own a portion

of the property, a courtesy letter to the owner of the remainder is appropriate. In the

event that a new appraiser is brought on board during the condemnation phase, the new

appraiser will undertake an inspection as set forth above.

To the extent possible, where an NRE report is being undertaken, the appraiser should

coordinate inspections with the NRE specialist.

D. Project Influence - Increase/Decrease in Value Due to Project

Any general decrease/ increase in the fair market value of real property, prior to the date

of valuation, caused by the public project for which the property is acquired, will be

disregarded in determining the just compensation. As an example of such a general

benefit, a new highway in a rural area may create a market change from rural to

commercial; however, this change is a result of the project and must be disregarded.

Where a project may have decreased the value of property to be acquired, the appraiser

will disregard such decreases other than those due to physical deterioration within the

reasonable control of the owner [see 49 CFR Section 24.103(b)]. The appraisal would

consider benefits such as a new highway ramp that benefits specific properties or a road

that will now serve a previously landlocked parcel. Consult with the Division of Law

regarding benefit determinations.

E. Appraisal must separately state Damages

The appraiser must separately state the damages and benefits to the remaining property

and the value of the property acquired. [see 49 CFR Section 24.103(a)(2)(iv)]. The

consideration of general and special benefits is to be in accordance with New Jersey

practices.

F. Tenant Owned Improvements

The appraiser must value all buildings, structures and improvements (including those

owned by tenants, which are considered as realty) as part of the real property, if they are

adversely impacted by the acquisition. Tenant owned buildings, structures or

improvements are to be appraised as part of the real property based on their contributory

value (as if they could remain in place for their remaining economic life), or their value for

removal (salvage value), whichever is greater. The appraiser will disregard lease terms

that require a tenant to remove buildings, structures or improvements and appraise them

as if they could stay through their usual economic life.

When the Department shall offer to acquire at least an equal interest in all buildings,

structures or other improvements located upon the property, owned by a tenant, which:

(1) it requires to be removed from the real property; or (2) it determines will be adversely

affected by the use to which such real property will be put. This shall include any

improvement of a tenant-owner who has the right or obligation to remove the

improvement at the expiration of the lease term. Any tenant owned building, structure,

or other improvement, which would be considered to be real property if owned by the

owner of the real property on which it is located shall likewise be considered to be real

property for purposes of this section. Where the tenant and owner cannot agree to the

proportion of the improvement value to be divided, the courts will make that determination

as part of a condemnation process.

G. Realty/Personalty Report

The Appraiser should note all items of realty that will be impacted and for which a value

must be paid. If an item to be acquired as part of the proposed acquisition is personalty,

the appraisal must clearly identify that as such. The appraiser must properly identify any

tenant claims to real property that will be acquired. If there are any questions regarding

what is tenant vs. owner or realty vs. personalty, the appraiser should make arrangements

to work with NJDOT’s relocation official assigned to the case to discuss. The results of

these investigations are to be presented in the realty/personalty descriptions of the

appraisal report. The relocation official will, if necessary, consult with a DAG to provide a

legal interpretation. Under no circumstances should an appraisal be unclear as to the

ownership and nature of items to be acquired. Some examples include the treatment of a

kiosk and signs at a leased service station as personalty and the removal of same by the

oil company. Specialty industrial machinery attached to a building may also be leased

rather than a permanent part of the real estate.

H. Appraisal Adjustments

In making adjustments, appraisers should consider the reasonableness of the adjustment

in the overall market. For instance, a percentage adjustment for market conditions (time)

may be appropriate, but an adjustment for the fact that the property under appraisal is

300' from a sewer connection while all of the comparable sales are connected to sewer

should be considered in a lump sum dollar adjustment to reflect the actual cost to mitigate

the subject property's comparative deficiency. If a percentage adjustment were applied

to the price per unit (e.g. per acre, per sq. ft., etc.) of each comparable for the sewer

connection, the adjustment to each of the comparables would vary, depending on the price

per unit of the comparable, and might have no relationship to the actual cost to mitigate

the subject's deficiency. Source is Uniform Appraisal Standards for Federal Land

Acquisitions at http://www.usdoj.gov/enrd/land-ack/.

I. Uneconomic Remnant

The term “uneconomic remnant” means a parcel of real property in which the owner is left

with an interest after the partial acquisition of the owner's property, and which NJDOT has

determined has little or no value or utility to the owner. Land which may have significant

economic value can still be uneconomic to that particular owner. By way of example two

residential lots remaining after a 30 lot subdivision is acquired from a major developer

would have limited utility to a developer of larger properties. A remainder with a significant

assemblage value likewise may be uneconomic to the original owner because that owner

would have to assume the risk of creating an assemblage sale.

The NJDOT will normally include uneconomic remnants in the acquisition. Where there are

multiple remnants and some are economic and some are not, the uneconomic remnants

will usually be combined with the parcel acquired as a single parcel. It is lawful to acquire

by lot lines and acquire the entire property, regardless of whether the remnants may be

uneconomic.

The property owner may petition NJDOT to retain ownership of an uneconomic remnant.

On the other hand, the property owner may petition NJDOT to acquire a remnant which in

the opinion of the owner has little or no value or utility. However, the decision to acquire

the remnant shall be at the sole discretion of NJDOT.

The determination as to whether or not to acquire a remnant should be made by the

Director or his designee in consultation with the Project Manager. The determination

should be made as early as practical with the assistance of the appraiser and the appraisal

reviewer. The Division of Law should be consulted if necessary.

Where contamination and/or solid waste have been detected on a remnant, NJDOT has

the discretion to acquire the remnant only after it has been remediated by the property

owner or another party to the degree acceptable to NJDOT.

Where a contaminated remainder is to be acquired, the agreement will normally provide

for a hold back of the payment of the appraised remainder value and for transfer of the

land upon remediation by the owner to a level which is acceptable to the NJDEP and the

Department. The appraiser should provide a separate valuation for uneconomic remnants,

unless they have been included in the main acquisition parcel and are not contaminated.

J. Relocation Assistance “Carve-outs”

The appraiser may be asked to calculate the value of certain structures or portions thereof,

appurtenances on or land areas within the parcel to facilitate the “carve out” of such

features in the administration of relocation benefits required by the Federal URA. Usually

this will be done during the relocation assistance phase of the project and may also be

done by the review appraiser utilizing information from an approved appraisal.

K. Appraiser’s Certification & Limiting Conditions

Appraisers are required to use NJDOT’s standard certification; however they may add to

the certification certain items that may be required by law, by USPAP, and/or by the

appraiser's professional organization(s). An example would be that the report must be

available for Peer review by the Appraiser’s professional organization. However, appraisers

are not permitted to add items which directly contradict NJDOT’s standard certification.

If there are additional limiting conditions needed that are not provided by NJDOT’s

Standard Limiting Conditions, the Appraiser may add them to the standard limiting

conditions provided that :

 The limiting condition is pertinent to the specific appraisal assignment

 The limiting condition does not conflict with the standard certification or standard

limiting conditions. If the Appraiser has any questions about what is permitted in a

certification or the limiting conditions, they should contact the Realty Specialist 4

for clarification.

 Any additional limiting conditions must be appended at the end of the standard

limiting conditions so that a reviewer will be able to find them.

Hypothetical Conditions and Extraordinary Assumptions must be clearly set forth in the

report in accordance with USPAP.

2.6.11 Appraisal Report Documentation

A. Approaches to Value

While the minimum format elements are flexible as to the manner of response, it is

NJDOT’s intent that the cost; sales comparison and income capitalization approaches will

be utilized [USPAP & 49 CFR Section 24.103(a)(2)] whenever applicable and that these

approaches will then be analyzed and correlated into a final estimate of value. If an

approach is not applicable, the appraiser may omit it only by sufficiently explaining the

reasons for so doing. Where the impact to the property is sufficiently minor, NJDOT may

request a “Land Only” report. The Appraiser remains responsible to inform NJDOT if this

is inconsistent with the level of valuation needed for a credible assignment in accordance

with USPAP standards.

B. Partial Acquisitions (Before and After Valuation Premise)

Where the acquisition is partial, a before and after valuation will be made in all instances

except for minor acquisitions where the appraiser, in consultation with NJDOT, has

determined that there are only nominal damages to the remainder. The before and after

appraisal method does not contemplate the appraiser's estimation of severance damages

in advance of valuing the remainder property (after condition). Before and after appraisals

should consist basically of an appraisal of the entire property in the “before condition” as

it exists before the acquisition and a second separate “after condition” appraisal of that

portion of the property remaining as if the acquisition has already occurred (extraordinary

assumption).

Where the appraiser determines that there are no damages from the acquisition to any

structures or buildings and only minimal site improvements are to be acquired, the

appraiser may use a before and after report to value the lot and include any impacted site

improvements. The appraiser must clearly note in the appraisal the reasoning for use of

a “land only” report.

On occasion, one or more additional steps must be added to the before and after approach.

Two different scenarios which have occurred are presented below:

A landlocked parcel which gains road frontage from a new road. The before and after

approach reveals an increase in value in the after condition. This property has a special

benefit which can be used to offset damages but not land value. Here, following the before

and after sections, a reconciliation section is created and the land area acquired is paid

using the before value unit rate.

C. Use of NRE Reports by Appraisers

The appraiser may request, or as part of the assignment may be provided with an NRE

report covering valuation of specialty items or potential mitigation of acquisition related

damages to the remainder. The appraiser should consider these reports and determine if

they are sufficient for the assignment. In the case of mitigation, the appraiser must

determine if it is economically justifiable to apply the proposed mitigation. The use of a

mitigation solution where the damages to be mitigated are less than the cost to mitigate

is inappropriate. An example of an inappropriate mitigation is the replacement of two

parking spaces in a 100 space lot where only 50 spaces are required by zoning and by

property use.

D. Use of Mitigation Parcels

The appraiser may suggest, or as part of the assignment may be informed about lands

owned by or to be acquired by NJDOT which are intended to be used for mitigation

purposes. These mitigation lands, like NRE mitigations must diminish damages and make

economic sense to use. The use of mitigation land results in a Weiswasser mitigation case.

The appraiser considers two values, one is presented with the mitigation parcel, plus any

(economically justified) mitigation costs or a second value with the value of the mitigation

land, plus any (economically justified) mitigation costs required for the remainder without

the mitigation land. The owner may accept the land, or the cash value of the mitigation

land, but cannot receive those damages to the property which the mitigation land would

have reduced or eliminated.

The appraiser should discuss any issues regarding the use of land for mitigation purposes

with the Division.

E. Addenda Documents

The appraisal addenda section should contain a copy of the latest deed into the subject,

copy of the relevant portions of the zoning regulations, a copy of the acquisition description

and a copy of sale deeds. The appraiser may include any other documents that the

appraiser deems relevant to the assignment.

2.7 Non Real Estate Report (NRE) Standards NJDOT Use of NRE Services

The Division utilizes NRE reports to provide valuations for specialty items which are not

typically valued in appraisals and to provide guidance in mitigation issues. Wherever

possible, the NRE specialist should arrange to meet with the assigned appraiser during the

appraiser’s inspection.

NRE reports can be divided into valuation and mitigation functions and the mitigation

function can be further divided into Access mitigation and Acquisition mitigation reports.

Complex parcels may require the use of more than one type of NRE report.

2.7.1 NRE Valuation Reports

Reports which provide valuations for mechanical equipment, nursery stock, specialized

inventories and any other area where an estimate of value is needed outside of typical real

estate appraisal practice. All valuations should explain the basis of the valuation estimate

such as cost manuals, published auction results and other acceptable market data sources.

2.7.2 NRE Mitigation Reports

Non-real estate reports used for mitigation can usually be divided into two distinct

functions.

A. Access Mitigation

An Access Impact Assistance Report (AIA report) is provided to an owner as part of the

State's statutory obligation to provide all necessary assistance to the owner in the

determination of reasonable alternative access to the general system of streets and

highways. AIA Reports are not required for every access case but can be provided in more

complex situations. These reports are used to demonstrate the proposed restoration of

circulation and other functions within the property that were disturbed solely as a result of

the access alteration. Typically these reports deal with changes to circulation aisles, other

maneuvering areas, realigning loading docks and related parking layout issues. An AIA

report is not part of the offer of just compensation as it is obtained in furtherance of the

access process. These reports must be limited to only those changes directly related to

access alterations and must not include any changes from any proposed property

acquisition. Access regulation or alteration is a separate activity from the acquisition of

property. An Access Impact Assistance Report is distinct from NRE and real property

appraisal reports, and the AIA reports are presented separately to the owner. In preparing

an AIA report, if governmental approvals are required to implement the proposed

mitigation, reasonable costs to cover this process must be included in the cost estimate

for the report. In rare instances the proposed alternative access assistance may need to

be revisited if it does not provide an economically sound approach to the problem or does

not provide a reasonable solution to the damages.

Persons reviewing or using an AIA report should alert the OAD of a situation where the

proposed assistance appears to be either inadequate (doesn’t resolve access damages) or

excessive (costs more to mitigate then damages to the property are worth).

In the event that it is not possible to completely differentiate access related impacts from

those resulting from an acquisition, the resultant report will be in the form of an NRE

mitigation report rather than an AIA report and will be treated as part of the regular

acquisition process.

Where mitigation is not possible, the specialist may be asked to convert their services to

an NRE report because the access process will not be able to proceed without an adequate

mitigation and thus the change of access will be converted from an access code driven

process to an eminent domain acquisition.

B. Acquisition Mitigation

Acquisition Mitigation is undertaken with NRE reports which are provided to the real estate

appraiser for consideration in estimating just compensation. The State is not obligated to

mitigate, or "cure" damages, particularly when the mitigation costs more than the impact

to the property. An AM type of NRE report is used to identify potential mitigation solutions

and to determine if paying to change the property to mitigate damages caused by an

acquisition is economically sound. Wherever possible, the NRE specialist preparing the AM

should arrange to meet with the assigned appraiser during the appraiser's inspection. At

a minimum, the NRE specialist preparing a mitigation report should provide a draft to the

unit requesting his/her services at least one week prior to the due date for the submission

of the AM report.

The NRE consultant should alert the Realty Specialist 4 or Litigation Support Specialist of

a situation where the proposed mitigation appears to be economically unsound.

If governmental approvals are required to implement the proposed mitigation, reasonable

costs for this process must be included in the cost estimate of the report. The expert must

consult with the municipality to determine if approval of the proposed mitigation is

"reasonably probable." If the municipality requires consideration of the entire property in

judging the proposed mitigation, the expert must expand the work product to cover this,

since it may impact upon the reasonable probability of approval of the mitigation solution.

The Realty Specialist 4 and if necessary the District assigned DAG should be consulted if

there are serious issues raised by the municipality in the pursuit of a reasonable probability

of approval.

Mitigation solutions are implemented only if the solution mitigates economic damages or

more simply, saves money over paying the owner for the damages. One example would

be mitigating two lost parking spaces in a one hundred space lot where only 80 spaces are

required under municipal code and the parking usage of the site is typically 85 spaces.

If the NRE expert determines that a mitigation plan is not possible or reasonable for

economic or other reasons, he/she should cease work and alert the Realty Specialist 4 or

OAD as appropriate, providing an explanation of their concerns. Where it is agreed that a

mitigation is not possible, the NRE expert would prepare a report detailing the conditions

before and after and state that there is no mitigation available. If the expert determines

that mitigation is possible, but that the highway project's construction plans would be

affected by the proposed mitigation plan or vice versa, the NRE Specialist should contact

the Realty Specialist 4 so that a determination can be made as to whether the highway

project plans can be modified to incorporate the mitigation plan or the mitigation modified

to accommodate the highway project plans.

2.7.3 NRE Consultant Qualifications

Consultant NRE Providers shall have the level of expertise and State Licensure and/or

Certification required for performing the contracted task in a credible manner in

accordance with State law, rules and regulations. NRE Consultants are to be selected for

assignments from a pre-qualified listing of NRE Consultants. The Department will add

consultants to its list based upon the experience, education, training,

certification/licensing, designation(s) and other qualifications necessary to provide the

required services.

2.7.4 NRE Testimony

NRE Consultants are expected, as part of their contract terms, to be available to testify at

the commission hearings and, if necessary, in court on the contents of their reports. Where

the Consultant is a firm, the firm agrees to provide competent testimony on the contracted

services, either through the use of replacement professionals from the firm acceptable to

the Department or by releasing the preparer of the original report to testify as to the

report.

2.7.5 Ethical Standards of Service for NRE Providers

The NRE Consultant shall not have any interest, direct or indirect, in the real or personal

property to be valued, nor business dealings with its owner(s), tenant(s) or

representatives.

All potential conflicts of interest must be reported by the NRE Consultant to the Technical

Support Bureau prior to the acceptance of any proposal for services. In the event that a

potential conflict is discovered in the course of performing the assignment, the NRE

Consultant must contact the Technical Support Bureau Manager prior to submitting any

reports.

Compensation for making an NRE shall not be based on the outcome of the report or the

amount of any valuation estimate.

No person shall attempt to unduly influence or coerce a person preparing an NRE report

regarding any valuation aspect of the NRE report.

The NRE specialist must conduct his/her work in accordance with the highest ethical

standards and must not have been convicted of a crime of moral turpitude.

Consultant valuation specialists must be in compliance with all State laws, regulations and

Executive Orders regarding eligibility for work as a consultant with the State of New Jersey.

Consultants must understand and abide by the ethical standards noted herein.

2.7.6 Information to be furnished to NRE Specialists

The NRE specialist must be provided with the IPM, Access Cutout or other map designated

for the assignment as well as information relative to the interpretation of State law

concerning non-compensable items and the treatment of benefits. For mitigation reports,

the Specialist will be provided with information relative to the nature of the proposed

project and remaining areas.

2.7.7 Maps & Map Errors or Omissions

Unless otherwise specifically directed, all reports shall be made in accordance with the

ownership, area, dimensions, building locations, access rights, parcels and easements as

shown on the Individual Parcel Map (IPM), Access Cutout or other map designated for the

assignment. In considering the maps, the NRE specialist is reminded to treat the after

condition on partial acquisitions as if it has in effect occurred, for the purpose of

determining the valuation of mitigations unless a different scenario is requested by the

Division. The NRE specialist should note that the IPM or other maps provided by NJDOT

may be approximate as to building dimensions because they are based in part on aerial

photography, which does not take into account any roof overhangs in the plotting of the

building dimensions. Thus, if a building or other improvements are a significant part of

the valuation or mitigation, the NRE specialist must use the proper techniques to measure

the building or site improvements in order to determine their correct dimensions.

If the NRE specialist notices plan errors/omissions, she/he should notify the District

Program Manager or Realty Specialist 4 or the assigned Litigation Support Coordinator in

the case of condemnation before proceeding with the report. In the case of an AIA, the

NRE specialist should notify the OAD. The Realty Specialist 4 or Litigation Support

Coordinator or OAD, as applicable, is responsible for the liaison with the CPM Project

Manager for clarification and/or correction of any errors or omissions and to provide the

NRE specialist with any corrected or revised plans.

2.7.8 Ownership of Reports

NRE reports (including AIA reports) and accompanying work product submitted to NJDOT

become the property of NJDOT and once delivered shall be retained by NJDOT and are

subject to public disclosure in accordance with New Jersey law.

2.7.9 Report Corrections, Revisions, and Additions

When a correction or revision is necessary, the NRE specialist shall furnish revised,

corrected or supplemented pages or portions of the report for attachment to the copies

already delivered as needed. Changes to the report initiated by the NRE specialist must

be delivered through regular channels and accepted by the Division as a formal revision of

the original report.

2.7.10 NRE Report General Standards

NRE (non-real estate) reports cover many unique circumstances, such as architects’

studies, landscape estimates, machinery cost estimates, cost to mitigate estimates,

planning studies, replacement of wells and septic systems, etc. It is expected that the

NRE specialist will utilize these instructions as a guide as to the minimum standards and

acceptable format. The goal of these standards is to ensure uniformity in the requisite

elements of all NRE reports, while providing latitude for the specialist to prepare reports in

their own narrative style, concurrently meeting licensing requirements and professional

organization standards in this field. The following elements shall be required for all

specialist reports:

 NRE Reports must be independently prepared and each NRE must be signed by the

individual(s) making the report.

 NRE Reports may not include any payment for relocation assistance or consider that

such payments will be made.

 In the event that an inspection of the property is required to prepare a credible

report, the owner or designated representative must be given an opportunity via

certified mail to accompany the specialist during the inspection of the property.

Information provided by the owner may assist in the valuation or mitigation process.

The specialist performing the report must be present during this inspection.

 The NRE specialist will perform the assignment and prepare the resultant report in

accord with the generally recognized professional standards governing the specialty

under which the assignment is conducted.

 The NRE specialist working on a mitigation report must meet with the appraiser

assigned to the parcel(s) upon which the specialist is working if an appraiser is

assigned to the parcel.

2.7.11 NRE Report Format

In completing the assignment, the NRE specialist shall provide properly bound reports on

8.5 x 11 inch quality white paper (except maps, which may be larger, if folded to fit within

the report) and shall adhere to the Sample Report Format guidelines in Section 2.10.

Because AIA reports are NRE reports which deal specifically with mitigating access

damages, the NRE specialist performing an AIA report will refer to the NRE instructions set

forth in this manual as a guide to the minimum standards and acceptable format, subject

to any special requirements requested by the Office of Access Design.

2.8 Administrative Determinations of Value

An Administrative Determination of Value or (ADV) represents an informal estimate by the

Division of the just compensation to be paid to an owner. The ADV is analogous to the

waiver valuation as defined in 49 CFR 24.2(a)(33) and set forth in 49 CFR 24 Subpart B

Section 24.102(c). An ADV is used in lieu of an appraisal and by definition is not an

appraisal.

2.8.1 Ethical Standards of Service for ADV Provider

The person performing the ADV shall not have any interest, direct or indirect, in the real

or personal property to be valued, nor business dealings with its owner(s), tenant(s) or

representatives. All potential conflicts of interest must be reported by the person

performing the ADV to the Technical Support Bureau Manager prior to undertaking any

services. In the event that a potential conflict is discovered in the course of performing

the assignment, the person performing the ADV must contact the Technical Support

Bureau prior to submitting an ADV.

Compensation for making an ADV shall not be based on the amount of the valuation

estimate.

No person shall attempt to unduly influence or coerce the person preparing an ADV

regarding any valuation or other aspect of an ADV.

The person preparing an ADV must conduct his/her work in accordance with the highest

ethical standards and must not have been convicted of a crime of moral turpitude.

2.8.2 Ownership of Report

ADV reports and any supplemental work product submitted to NJDOT become the property

of NJDOT and once delivered shall be retained by NJDOT, subject to disclosure in

accordance with New Jersey law.

2.8.3 Report Corrections, Revisions, and Additions

When a correction or revision is necessary, the ADV preparer shall furnish replacement

reports. Changes to the report initiated by the ADV preparer must be delivered through

regular channels and accepted by the Division as a formal revision of the original report.

2.8.4 Applicability

The Project Realty Specialist 4 in conjunction with the Review Appraiser(s) in the

development of the appraisal plan determines which cases can be initially valued utilizing

an administrative determination of value. Among the factors to be considered are the

nature and complexity of the acquisition, estimated value and the anticipated reaction of

the property owner, based upon any prior experience with the owner and community

reaction to the project. It is necessary that owners on a given project be treated with

consistency and uniformity as the determinations of value are developed.

2.8.5 Preparation of Administrative Determinations of Value

The person performing the waiver valuation must have sufficient understanding of the local

real estate market to be qualified to make the ADV. [See 49 CFR Section 24.102(c) ii (B)].

If the person preparing the ADV is a licensed or certified appraiser, they should not include

any appraisal license information on the ADV to avoid creating the impression that the ADV

is an appraisal. To the greatest extent practicable, the person preparing the ADV should

also prepare the appraisal report, when negotiations cannot be concluded successfully. If

the ADV was prepared by a person without the appraisal license or certification needed for

this type of appraisal assignment, then the appraisal assignment should be done by a

person who does hold the requisite license.

2.8.6 Scope of Administrative Determinations of Value

The Administrative Determination of Value is not an appraisal [49 CFR 24.103], and has a

lesser degree of investigation and analysis involved than an appraisal. At a minimum, the

property should be inspected from the roadway unless there is a need to actually enter the

property, in which case an inspection letter is required. The preparer should secure basic

comparable sales data. Sales verification and deed research should not be necessary. It

is therefore anticipated that this format can be completed in an abbreviated time frame,

in order to permit accelerated negotiations. It should be noted that property owner

accompaniment is not required unless the property is to be entered for inspection.

2.8.7 Level of Documentation for ADV

 $1-25,000 ($10,000 limit for Local Public Agencies) — Provide unit values, sales

data, fee/easement calculations and zoning. The presentation can be a spreadsheet

type of document without the need to show any individual adjustments.

2.9 Standing Crop Valuations

Standing Crop valuations are a special entitlement payment authorized by N.J.S.A. 20:3-

29.1 to farm owners who are losing permanent crops (alfalfa, harvested daffodils, peach

trees, vineyards, etc.). The anticipated annual average income from the standing crop

over its remaining average productive life will be developed for the Department by a

qualified agricultural expert, as determined by the Department. The agricultural specialist

will estimate the average remaining productive life of the crop, the average anticipated

gross income from the impacted crop and the anticipated expenses related to harvest and

sale of the produce. The net anticipated income from the crop over the average remaining

productive life of the crop, if not an annual crop, will then be capitalized by the Department

into a present value. N.J.A.C. 16:5-2.4

The standing crop value is not included with the eminent domain value of the property

acquired.

If the highest and best use of the property to be acquired is farmland, then the appraiser

of the acquisition parcel must avoid creating duplicate payments for crop income where

payments are made under this separate process.

2.10 Appraisal Review

2.10.1 Standards

Minimum requirements for appraisal review are based upon USPAP Standard 3 and 49 CFR

24.104.

2.10.2 Review Requirements

All appraisals, regardless of value, shall be reviewed and NRE reports considered, by a

qualified review appraiser who will recommend the estimate of just compensation prior to

the initiation of negotiations. The review appraiser must determine that the appraisal

documentation, including valuation data, demonstrates soundness as to the opinion of

value and results in a credible report. The level of explanation for the reviewer’s

recommended value depends upon the complexity of the appraisal problem.

Upon receipt of the appraisal/NRE reports in the District office, a qualified Review Appraiser

is to perform a formal review and the report is then registered by a staff person for a

consultant review or a staff reviewer for an in house review. The expected completion

dates for a review assignment shall be consistent with the project schedule, workloads and

complexity of the review. All initial appraisal reports are to be desk/field reviewed.

2.10.3 Review Functions

The appraisal review function is a critical quality control element in the

valuation/acquisition process. An appraisal review is not an arithmetic or grammatical

review of an appraisal report. It is a comprehensive examination of the appraisal as

reported by the appraiser that addresses the following responsibilities:

 Examination of the appraisal’s analysis and presentation of data.

 Assure all appraisal requirements are met in relation to the assignment.

 Determine that report meets definition of appraisal in 49 CFR 24.2(a)(3).

 Determine that report meets the standards set forth herein.

A. Field Inspections

Field inspections consist of an interior and/or exterior inspection of the subject property

and all of the sales and lease data utilized in the appraisal reports reviewed by the review

appraiser. The date of such inspections shall be noted by the review appraiser in the

written review report that is prepared.

B. Review Analysis

The review appraiser shall examine the appraisal reports to determine that they are

complete in accordance with the appraisal fee contract or staff appraisal assignment

conditions. The review appraiser will determine if the report(s) comply with USPAP; follow

accepted professional principles and techniques, comply with applicable laws, rules and

regulations; contain the information and documentation necessary to substantiate the

conclusions and estimated value and contain an identification or listing of the buildings,

structures and other improvements on the land, as well as the fixtures that the appraiser

considered to be a part of the real property under appraisal; include consideration of all

compensable items and do not include compensation for non-compensable items; and

show the correct arbitrary breakdown provided by each appraisal under review allocating

the estimated just compensation between the land, improvement, and damage elements

resulting from the taking.

The Review Appraiser may consider all pertinent value information that is available,

including other appraisals obtained by NJDOT and information or appraisals provided by

the property owner, as well as sales not included in the appraisals, but of which the Review

Appraiser has knowledge. The review of the appraisal(s) shall be documented in

accordance with State and Federal procedures and USPAP Standard No. 3. In the event

the Reviewer should conclude that a fair market value should differ from that which was

established in the appraisal report(s), the Reviewer may request an additional appraisal

report or the Reviewer may provide his/her own opinion of value in which case the reviewer

becomes the appraiser of record and must provide an appraisal report properly

documented in accordance with USPAP Standards 1 & 2 and the standards referenced in

this Manual.

As part of the review process, the review appraiser shall send the appraiser or NRE

Specialist an addendum request for corrective supplementation to appraisal reports and

NRE reports that do not conform to the standards as set forth in this manual. Return date

for the supplemental material is to be at least one week prior to the review assignment

due date. Addendum requests shall be sufficiently detailed so as to attain a goal of one

addendum request per review assignment. The addendum request shall be written in a

professional and respectful manner with the intent of obtaining a more credible report. It

shall not be communicated in an adversarial fashion. All addendum requests (staff or

consultant) shall be in writing for anything other than minor corrections and entered into

the appropriate fields in the Right of Way database at the time of occurrence.

The review form may provide an explanation regarding minor factual errors or omissions

found in the appraisal report in lieu of making corrections to the appraisal, provided the

errors or omissions in the appraisal do not materially affect the final value conclusion or in

the aggregate affect the credibility of the value conclusion. The use of this option should

be very limited because NJDOT appraisals are being used in a potentially adversarial legal

process and the impact of minor errors on an appraiser’s credibility can become magnified

in this type of setting.

The review form will identify and document the findings and conclusions arrived at during

the review of the appraisal(s) and consideration of any NRE reports. Damages or benefits

to any remaining property shall be identified in the review appraiser's report.

C. Acceptance, Rejection and Recommendation of Appraisals

The review form will clearly state the reviewer’s determination of whether an appraisal

report is accepted based upon the quality and credibility of the report and its compliance

with applicable standards, rules, regulations and laws.

In conducting a review, the reviewer must maintain a professional standard, and recognize

that the appraiser is not responsible to direct the appraiser to a specific value. Rather,

the reviewer is to work with the appraiser to address issues that impact credibility in a

respectful and professional manner.

If a report fails to meet basic standards and is not corrected by the appraiser, the review

appraiser will note that the report is not accepted (rejected). The reviewer must have very

specific, valid and supportable reasons for recommending that a report not be accepted.

Valid reasons for rejection do not include personality conflicts, difficulty working with an

appraiser or minor errors which do not impact the valuation process, etc. Any appraisal

report that the reviewer intends to recommend not be accepted because it cannot be

satisfactorily supplemented/corrected must be discussed with the Technical Support

Bureau staff prior to submittal of the review recommending that the report not be accepted.

The Review Appraiser will, as a result of his/her review of the appraisal reports,

recommend one of the accepted appraisal reports as the basis for the establishment of the

amount believed to be just compensation.

D. Reviewer Performing a Replacement Appraisal

If the review appraiser is unable to recommend an appraisal for the establishment of just

compensation due to flaws in the appraisal, it is typical to seek another appraisal. If it is

not practical to secure an additional appraisal, the review appraiser’s scope may be

enlarged to include development of an independent report consistent with the standards

previously set forth in this manual for the preparation of appraisals. Such an enlarged

scope would require an additional fee for the fee review appraiser. Use of the reviewer to

provide an appraisal, while acknowledged in USPAP, is not recommended because there is

no reviewer for the reviewer’s appraisal, and it may be difficult for an owner or jury

member to understand the combined work product that would result. For that reason,

using a replacement appraiser is the recommended path.

E. Reviewing Cases with More than one Appraisal

In performing a review of a case with multiple appraisals, the appraiser must provide an

analysis of the similarities, dissimilarities, strengths, weaknesses, etc. of each of the

reports and make a recommendation of the report having the greatest strengths in

analyzing market trends and data provided. Where the appraisals for a single parcel have

substantive factual elements in dispute or conflict (e.g. zoning, improvement size, etc.),

the reviewer must resolve such conflicts so that the appraisers are reporting on essentially

the same set of circumstances. Factors then weighing into the selection of one report

over another must be explained clearly within the registration. In the event of problems

in resolving widely divergent opinions, the matter should be elevated to the Technical

Support Bureau Manager or Designee, who will then assist in resolving the matter.

When reports have been updated, the Review Appraiser must provide an explanation of

substantial changes, if any, which have occurred between the update report(s) and the

original reports. Review appraisers should be given access to the original reports in order

to understand any changes in the valuation work that occurred earlier in the case.

F. Use of ADV when Negotiations Fail / Condemnation

In those cases where the original offer was predicated upon an ADV and the fair market

value of the subsequent appraisal is lower than the ADV, the review appraiser shall present

both the ADV and the appraisal information in the review form. The registered just

compensation estimate shall be based on the higher value of the ADV or appraisal. In the

event that the case is submitted to condemnation, if the appraisal which replaces the ADV

is to be used for testimony and has a lower valuation than the ADV, the ADV offer will be

submitted and the appraiser will testify to her/his lower fair market value. If a subsequent

update appraisal is produced, the subsequent offer and testimony would be based upon

the updated appraisal.

2.10.4 Review Appraiser’s Delegated Authority

A. Staff Review Appraisers

In preparing their Fair Market Value Statement persons holding the Appraiser II title are

delegated the authority to do the following actions with an appraisal report:

 Accept and recommend as the basis for the offer of just compensation

 Accept, but not recommended for use as the basis for an offer

 Not Accept (rejected) in accordance with Section 2.9.3

 Register the appraisal as just compensation to be offered to the property owner

The Staff Review Appraiser must discuss the non-acceptance (rejection) of an appraisal

report with the Technical Support Bureau Manager or Designee prior to submission of

his/her Fair Market Value Statement.

B. Consultant Fee Reviewers

Consultant Fee Reviewers in preparing their Fair Market Value Statement are delegated

the authority to do the following actions with an appraisal report:

 Accept and recommend as the basis for the offer of just compensation

 Accept, but not recommended for use as the basis for an offer

 Not Accept (rejected) in accordance with the manual.

Fee Reviewers are not permitted to register an appraisal.

The Fee Reviewer must discuss the non acceptance (rejection) of an appraisal report with

the Technical Support Bureau Manager or Designee prior to submission of his/her Fair

Market Value Statement.

2.10.5 Registration & Re-Registration of the Estimated Just Compensation

Staff Reviewers and higher titles are authorized to register an appraisal as the

Department’s estimate of Just Compensation. These titles, along with qualified Realty

Specialists 3 and 4 may likewise approve an ADV prepared by a person other than an

Appraiser 1 or Appraiser 2. The registration of an appraisal and the approval of an ADV

cannot be delegated to a non departmental employee and must be the decision of an

NJDOT or in the case of an LPA, a decision by an employee of that agency. The person

registering the appraisal report must select from one of the reports that were accepted by

the review appraiser. If the person registering the appraisal report is not using the

appraisal report recommended by the reviewer, the person registering the appraisal report

must append a written explanation as to the reason for using a different appraisal.

All re-registrations of fair market value are to be prepared in the same manner as original

registrations and are to be processed as previously set forth. Registrations for NJDOT

should be recorded with the Right of Way Database system.

A. Registering a case with pending Minor Corrections

Cases may be registered pending minor appraisal correction, pending the Reviewing

Appraiser’s receipt of the supplemental information. This will permit the Agent to initiate

preparatory work on the case as well as the arrangement of an appointment with the

owner, consistent with the anticipated delivery of the corrected appraisal information.

Minor appraisal corrections would typically include items such as mathematical or technical

errors not affecting the final value conclusion and non-judgmental items that can be

corrected promptly and with a high degree of certainty as to the corrective action to be

taken. Cases registered pending correction should contain a memorandum stating the type

of correction sought and the anticipated delivery date.

2.10.6 Ethical Standards of Service for Appraisal Review Providers

 The review appraiser shall not have any interest, direct or indirect, in the real or

personal property to be valued, nor business dealings with its owner(s), tenant(s)

or representatives. No reviewer shall undertake a formal review or registration of

any property upon which she/he has previously rendered a value through an

appraisal or through an ADV. To avoid potential conflicts, an appraiser who has

worked on a project shall not review other reports on that same project. All potential

conflicts of interest must be reported by the review appraiser to the Technical

Support Bureau Manager or Designee prior to undertaking any assignment. In the

event that a potential conflict is discovered in the course of performing the

assignment, the reviewer must contact the Technical Support Bureau prior to

submitting any reports.

 Compensation for making an appraisal review shall not be based on the amount of

the valuation estimate or outcome of the review.

 No person shall attempt to unduly influence or coerce a review appraiser regarding

any valuation or other aspect of the review.

 The Appraisal Reviewer must conduct his/her work in accordance with the highest

ethical standards and must not have been convicted of a crime of moral turpitude

and be currently certified in New Jersey.

 Consultant Appraisal Reviewers must be in compliance with all State laws,

regulations and Executive Orders regarding his/her eligibility for work as a

consultant with the State of New Jersey.

 Consultants must understand and abide by the Division Fee Consultant Policy.

 Reviewers must undertake their review function in a non-adversarial professional

manner with the goal of helping the appraiser produce a credible report.

2.10.7 Ownership of Report

Review appraisal reports and work product submitted to NJDOT become the property of

NJDOT and once delivered shall be retained by NJDOT.

2.10.8 Appraisal Review Report Corrections, Revisions, and Additions

When a correction or revision to the appraisal review report is necessary, the review

appraiser shall furnish corrected, revised or supplemented pages or portions of the report

for attachment to the copies already delivered. Changes to the report initiated by the

review appraiser must be delivered through regular channels and accepted by the Division

as a formal revision of the original report.

2.11 Sample Report Formats

Unless otherwise specifically provided in the contract, the Sample Forms provided in the

link https://www.nj.gov/transportation/eng/forms/#row indicate the typical elements in

appraisal reports, appraisal review reports, ADV reports, and NRE reports, respectively.

Section 3 Negotiations

3.1 General

 The acquisition of real property is governed by the State’s Eminent Domain Act of

1971 (N.J.S.A. 20:3-1, et seq.) and the Federal Highway Administration (FHWA)

regulations as contained in 49 CFR Part 24 and 23 CFR Part 710.

 Federal Land Transfers are provided under 23 CFR 710.601 for federally funded

projects. FHWA may act as an agent to assist in the transfer of federally owned

lands, or NJDOT or LPA may directly approach a federal agency for the acquisition.

 Direct Federal Acquisition is covered under 23 CFR 710.603 whereby the FHWA may

at the request of NJDOT or an LPA attempt to acquire property on behalf of NJDOT

or LPA through federal eminent domain proceedings.

3.2 Assignment of Negotiations

 It is a requirement that each owner is to be provided with copies of all real property

appraisal reports, ADV’s and all non-real estate reports obtained prior to the filing

of condemnation.

 The procedures for ordering appraisals, appraisal reviews and NRE reports is found

in the Section 2, Appraisal and Review. No negotiations should commence until

such time as the amount of Just Compensation is established in accordance with

Section 2.

 Subsequent to establishing the just compensation amount for a parcel, the Project

Realty Specialist 4/Realty Specialist 4 and/or Realty Specialist 3 shall review and

evaluate the case file, plans, appraisal and registration prior to initiating a written

assignment of the case to a realty specialist. The purpose of this review and

evaluation is to determine the level of experience believed necessary to conduct

negotiations in a competent and effective manner. Also, it is to identify particular

areas of concern that may impact the conduct of negotiations, and possibly influence

a favorable outcome. Upon completion of the review and evaluation, the case is to

be assigned according to the experience level of the individual realty specialist. The

assignment shall note any areas of concern and contain a date by which negotiations

are to be completed. This date shall be compatible with the District Office due date

for completion of negotiations on the project.

 Cases involving acquisition from a utility company, railroad company, NJDEP or

riparian parcels will be handled by the District Office.

 The realty specialist will be provided with:

1. All appraisal and non-real estate reports which were relied upon in establishing

the just compensation

2. A case summary form, which contains the reviewing appraiser’s review of fair

market value appraisal(s).

3. The individual parcel maps and parcel description

4. The Owner Housing Supplement on parcels which the owner occupies as his/her

primary residence, so that any supplemental payment due the owner can be

tendered simultaneously with the offer of the just compensation for the property

5. A copy of the environmental summary memorandum and/or environmental

investigation reporting process cost report, as applicable

6. Prior to the initial negotiations contact, the realty specialist should secure the

site survey and any data developed during the preparation of the Workable

Relocation Assistance Plan. Specifics regarding supplemental housing payments

are presented in the Relocation Section.

7. Subsequent to being informed of the right to receive just compensation, based

on the registered appraisal or approved ADV, the owner may make a gift or

donation of the property, any part thereof, any interest therein, or any

compensation paid therefore. The owner must acknowledge that they are

waiving part or all of the compensation.

8. The standards for appraisals and appraisal review, as well as qualifications for

appraisers, are presented in the Appraisal Section.

9. If the assignment contains Underground Storage Tanks or Decommissioning of

Underground Storage Tanks, guidance can be found in Section 4.

10.When the District is ready to proceed with the acquisition phase of a project, it

will forward an Initial Notification Letter and General Information Brochure prior

to direct contact with the owner, unless specific circumstances require an

expedited acquisition.

3.3 Realty Specialist Pre-Negotiations Activities

The realty specialist should take the following steps:

 Consult with the Project Realty Specialist 4 regarding any concerns cited on the

assignment

 Review and understand the appraisal/non real estate reports and the appraisal

review

 Consult with the reviewer/Realty Specialist 4/Realty Specialist regarding any

questions as to the appraisal process or valuation

 Review the right of way plans, construction plans, profiles and cross sections to

verify consistency with the appraisal report and to identify any design changes in

the vicinity of the property

 Review the District’s project scoping file, which may contain records of public

information centers, hearings and other prior public contact

 Conduct an on-site inspection of the parcel, noting evidence of any recent or pending

improvements and physical access in the before situation; note any improvements

and/or circumstances that differ from those within the appraisal report

 Become familiar with any owner housing supplements which may be included in the

offer; (Specifics regarding owner/tenant housing supplements are contained in

Relocation Section.)

 Ensure that an environmental screening has been completed and that BLAES has

provided the environmental summary memorandum and/ or environmental

investigation reporting process report to the Division of Right of Way and Access

Management, so that a copy can be provided to the owner

Secure a copy of the appropriate environmental clauses that will appear in

Paragraphs 6, 7 & 8 of the Complaint; (Bona fide negotiations may not be considered

completed, nor a Complaint filed until these documents have been provided to the

property owner.)

 Prepare the offer letter and assemble an agreement package containing the

appropriate clauses and pages

If, after completing the above steps, the realty specialist believes the case is beyond

his/her experience level in terms of complexity, he/she is to document in writing the basis

for such a belief and consult as appropriate with the Realty Specialist 4. The Realty

Specialist 4 will consider the issues raised by the realty specialist and make a determination

as to their merit. A written response will be issued to the realty specialist.

In the event the Realty Specialist 4 disagrees with the realty specialist, the response will

set forth the basis for such a determination and the realty specialist will then continue to

process the case in accordance with the assignment. If the Realty Specialist 4 determines

that the issues identified are beyond the scope of the realty specialist’s experience, either

of the following actions may take place:

 The case, or one or more of its component parts, may be reassigned to another

realty specialist having more experience with the particular circumstances. In those

instances whereby a more experienced realty specialist is providing assistance, this

interaction shall be as a lead worker, as opposed to exercising any supervisory

responsibilities; or,

 The Realty Specialist 3 may be instructed to actively participate with the assigned

realty specialist in completing the case. This participation may, among other things,

include attendance at meetings with property owners/specialists, project managers,

designers, and DAsG.

The assigned realty specialist shall retain primary responsibility for processing the case,

even though some form of the above-indicated assistance is being provided.

It is recognized that issues may arise during the course of negotiations that may introduce

complexities beyond the realty specialist’s experience level. In such instances, the realty

specialist shall report to the Realty Specialist 4 in the same manner as indicated above,

who shall then respond accordingly.

The written communications between the parties, relevant to this procedure, are to be

maintained in a District file and are subject to audit by the Manager, Bureau of Technical

Support.

3.4 Negotiations with the Property Owner

A. When arranging meetings with the property owner for commencement of negotiations,

the realty specialist must be careful not to place any undue burden on the owner to

satisfy the realty specialist’s personal desires or schedule. There may be occasions

where the realty specialist is unsuccessful in promptly arranging for an initial

negotiations contact with the owner. In such instances, in order to formally initiate the

negotiations phase of the acquisition process, the realty specialist may transmit the

offer letter and appraisal/specialist reports to the owner or owner’s representative by

certified mail or via an approved delivery service. The realty specialist should,

subsequently, actively attempt to schedule an appointment to meet with the owner to

go over the material in person.

B. Negotiations involving absentee or out of State owners may, of necessity, be conducted

by mail. This method should be the methodology of choice when involving national

firms or corporations, or, when there is an attorney letter of representation already in

the file.

C. If the owner states that he /she is represented by counsel, the realty specialist should

request a letter of representation from the owner’s counsel affirming the representation

arrangement. Upon receipt of the letter of representation, the specialist should only

contact the representative regarding the case. Under no circumstances should the

specialist discuss value with the owner without express permission of the owner’s

representative. An owner’s representation can only be rescinded in writing. Verbal

information from an owner does not rescind the letter of representation. If no letter is

forthcoming, a confirming letter will be sent to the owner with a copy to the

representative.

D. Owners of improved residential properties who are being displaced and sign an

agreement shall be eligible for a down payment up to 25% of the purchase price,

provided the amount of the down payment does not exceed 75% of the owner’s equity

in the property.

E. If time permits, an owner may be permitted to retain improvements or fixtures located

on the property. Specifics regarding improvement retention are presented in the

Relocation Section.

F. Offer Process

At the initial negotiations contact, the realty specialist shall:

1. Provide the owner with a written statement of the basis for the offer of just

compensation (Offer Letter), which shall include the items to be acquired including

removable building equipment and trade fixtures, which are considered to be part

of the real property to be acquired and any personalty that will be acquired. In

those instances where negotiations are initiated based on an ADV, the Offer Letter

shall clearly state that the offer is predicated upon an Administrative Determination

of Value, rather than an appraisal report.

2. Present the owner/ representative with all appraisal/specialist reports and discuss

the appraisal report(s) with the owner/representative. If negotiations are based

upon an Administrative Determination of Value (ADV), inform the

owner/representative that he/she is entitled to a formal real estate appraisal report

if an amicable settlement cannot be reached based upon the ADV.

3. Provide the owner/representative with a copy of the IPM or other maps and

descriptions of the property and the acquisition and remainder (if any).

4. Explain the meaning of the various terms and conditions of the real estate

agreement.

5. Surrender of Possession of Property. It should be made perfectly clear to the

owner/representative that he/she is not required to surrender possession of the

premises until either the purchase price is paid or the just compensation has been

deposited with the Superior Court.

6. Surrender of Possession Prior to Payment: Should an owner agree to surrender

possession of the real property prior to payment, the following clause shall be

included in the agreement: “The seller acknowledges that he/she understands that

he/she is not required to surrender possession until such time that payment is made

and hereby relinquishes that right and agrees to surrender possession of the

property in advance of payment by or before the date herein specified”.

7. Advise the owner/representative that an environmental screening has been

performed and that the offer letter sets forth the environmental status of the

property. As applicable, ensure that the BLAES has mailed the environmental

investigation reporting process report to the owner or that it will be provided to the

owner during the initial negotiations contact. The environmental investigation

reporting process report will provide the owner with a description of the remediation

work that NJDOT will undertake on that portion of the property needed for the

project and the estimated cost to clean up the acquired property to the extent

necessary for the project in accordance with NJDEP approvals issued to the

Department. This cost will appear in the written offer to the owner. The cleanup

work undertaken is only to the extent needed to construct the project, and will not

remediate the remainder of the property, or address groundwater contamination

unless specifically noted. Any additional environmental information disclosed

during owner contact should be transmitted to BLAES for further investigation for

possible revision to the environmental summary memoranda and complaint

language.

8. Provide the owner with a copy of the real estate agreement, making certain that if

it is for easement(s) only that it is an Easement Agreement and refers to a Deed of

Easement.

9. Review the agreement clauses and discuss the environmental clauses that are

contained in the agreement. A copy of paragraphs 6, 7 & 8 of the Complaint should

be provided to and discussed with the owner. The owner should be made aware of

the fact that our Complaint will contain the environmental clauses, in the event that

bona fide negotiations do not result in a settlement.

These elements are also to be part of an offer packet mailed to the owner or

representative.

Pre-condemnation Revisions

In the event of revisions, the owner will be provided with copies of any of the above

documents which have changed as a result of the revision. Elements of the case which

remain unchanged do not have to be provided again.

Post Condemnation Negotiations

Once a case has been submitted for condemnation, negotiations have concluded.

Settlement discussions may take place between the owner/representative and the

assigned DAG. The owner/representative will be provided with updates of the appraisal

and NRE which were relied upon in setting the updated value. Those appraisals and

NREs which were not relied upon are not provided to the owner/representative post

condemnation.

G. The owner should be made aware of the fact that the real estate agreement is not

binding upon the State until it is approved by the Commissioner or his/her designee.

Therefore, the time period to closing begins to run upon execution by the Commissioner

or his/her designee, not the date that the owner signs the agreement.

H. The realty specialist shall inform the owner that the terms of the written agreement

represent the full understanding between the owner and the Department and that,

regardless of prior discussions, understandings or communications, the terms of the

agreement control the conveyance of the property. Owner requests for changes to our

standard agreement should be directed to the Closing Bureau or Division of Law,

Transportation Construction and Condemnation Section as well as the Capital Program

Project Manager.

I. Once executed by the owner, the agreement shall not be revised or altered, unless it

is accomplished through the execution of a new agreement or concurrence in the

change by the initialing of the change by the owner. Any unauthorized change or

alteration to a signed agreement is a fraudulent act and subject to disciplinary and

possibly legal action. Each page of the agreement including the description page shall

be initialed by the owner as well as any additions or subtractions approved per

paragraph H of this section.

J. The realty specialist shall assure the owner that the signing of the agreement does not

terminate the Department’s responsibility to the owner and that the realty specialist

will be available to assist the owner at any time.

3.5 Special Negotiations

A. Green Acres encumbered properties have a special process to release the restriction.

Compensation for the diversion of the parkland is normally in the form of replacement

land. The E-Team works with the Division and the local government to prepare the

Green Acres diversion application. Required with the application is an appraisal of the

disturbed parkland (may only be a carve out from a larger park), and an appraisal of

the replacement parcel, which Green Acres analyzes to ensure that the local

government entity received fair consideration. For small acquisitions, the

compensation may be given in the form of improvements to the impacted or another

park. Under no circumstances is the consideration to be in the form of unrestricted

cash as the compensation must improve or replace the park, and is not to be used for

any other non-park purpose. Conservation Restricted land may involve compensation

to the owner and some form of compensation to release the easement. Farmland

restrictions are paid on the basis of the contract which establishes a ratio of value

between the development rights and the underlying land. The owner would get the

value of the restricted land and SADC would receive reimbursement for the

development rights.

B. Weiswasser Cases are another special negotiation situation. The NJDOT offers to

convey mitigation land to offset damages from the acquisition, or the cash value of the

mitigation land. The offer reflects the two scenarios, offer value with the mitigation

land, and a second value with a cash amount instead of the mitigation land. The owner

cannot be compelled to accept the mitigation land and may take its cash value, but the

owner is not entitled to any damages which the land mitigation would have corrected.

The transfer of the mitigation property occurs after the owner has agreed to accept it

and after any work to be done on the mitigation parcel is complete.

Temporary possession (if available) of the mitigation land can be given to the adjoining

owner while permanent title transfer is underway. In the unlikely event that NJDOT is

prevented from conveying the mitigation parcel(s), NJDOT will promptly reopen the

case and undertake to provide alternative mitigation or provide the appropriate

compensation to the property owner. The Division should make clear what will be

transferred and when. The transfer can occur at the end of the project if other

temporary arrangements can be made, but must be available to prevent additional

damages to the property being mitigated.

3.6 Realty Specialist’s Case Summary (call data)

A. The record of the realty specialist’s personal negotiations contacts are an important tool

on which the Department relies when it requests reimbursement for acquisition costs

on Federal-aid projects. In addition, the call data documents that bona fide negotiations

have been conducted and serves as an integral component of the justification either for

an administrative settlement or for initiating condemnation. Comprehensive call data

enables a substitute realty specialist to successfully continue negotiations in those

instances where the original realty specialist cannot continue the negotiations.

B. The realty specialist is to make detailed entries in the Division’s data base system

covering each contact and meeting with the owner or owner’s counsel. The call data

should be factual and avoid editorial or emotional entries. These entries are to be made

as soon as possible after each contact to ensure accuracy. The negotiations record

(diary) may be subject to discovery during the initial stages of the condemnation action

prior to the Appointment of Commissioners and may be evidential in court in

determining whether bona fide negotiations occurred.

Call Data should include, but not be limited to the following:

1. Date of parcel assignment

2. Date, telephone number and full name of any parties in interest, contacted by

telephone

3. Date, address and place of any meeting with parties in interest

4. Full names of all adult participants and their relationship to the owner

5. Amount of the offer and the verification of the fact that the offer was made in writing

6. Verification of the presentation of:

a. All real estate and non-real estate appraisal reports; The just compensation offer

letter

b. The owner housing supplement, if applicable

c. The environmental summary memorandum and environmental investigation

reporting process cost report, as applicable

7. The details regarding any negotiated administrative settlement

8. A summary of the events of meetings, including:

a. The owner’s response to the offer

b. Details of any counteroffer

c. Owner’s questions and realty specialist’s responses; and

d. Any comments regarding the appraisal process/report.

9. Note that “intent to condemn” letter was transmitted to the owner, if applicable.

C. The call data documents that the State has followed acquisition practices that:

1. Encourage and expedite the acquisition of real property by agreement with owners

2. Avoid litigation

3. Assure consistent treatment for owners in the public improvement program

4. Promote public confidence in public land acquisition practices.

3.7 Realty Specialist Responsibility/Authority

A. Once assigned a case, the realty specialist retains responsibility for the case, until an

agreement is consummated or the final judgment as to the Department’s authority to

condemn is completed (completion of the show cause process). After a case has been

submitted for condemnation by the District Office, any communication between the

District Office and the property owner shall be coordinated with the assigned DAG. As

the primary contact with the property owner, the realty specialist should be accorded

significant authority and responsibility in negotiations and should:

1. Consider and respond to any counteroffer received from the owner, subject to

approval of the agreement

2. Be encouraged to develop a direct liaison with the project managers and other units

within the department, concerning design changes, access and environmental issues

and any other issues related to the acquisition of the property

B. Dependent upon the complexity and/or dollar amount of the acquisition, the Project

Realty Specialist 4 may decide to assign a more experienced realty specialist to

accompany the realty primary realty specialist on a negotiations contact.

C. Negotiations shall be conducted without any attempt to coerce the property owner into

reaching an agreement:

1. The realty specialist should be particularly careful not to imply that the negotiation

is a “take it or leave it” situation.

2. At the appropriate time, the initiation of condemnation should be presented as an

opportunity for the owner to receive an unbiased decision as to the just

compensation and should not be stated in a threatening manner.

D. The time of condemnation shall not be advanced, negotiations deferred, or the deposit

of funds with the Superior Court delayed, in order to induce an agreement on the price

to be paid for the property.

3.8 Administrative/Legal Settlements

A. An administrative settlement is any settlement made through administrative means,

prior to the filing of a condemnation complaint, which is in excess of the approved

valuation of just compensation.

B. A Legal settlement is any settlement made after the Complaint is filed. A DAG may

prepare a memorandum documenting the basis for the proposed settlement, upon

which the appropriate Right of Way official may note concurrence.

C. Both Federal and State law and regulation require an attempt to expedite the

acquisition of real property by reaching agreements with owners to avoid litigation and

to relieve congestion in the courts.

D. Administrative settlements are entered into for properly documented reasons which are

considered to be in the public interest. The administrative settlement process shall be

maintained separate from the appraisal and appraisal review function.

E. All proposed settlements must include written justification regarding the proposed

settlement. The amount of justification should be consummate with the value of the

settlement. For larger settlements, details including sales charts and grids, detailed

explanations of the issues and recommendations, copies of alternate comparable sales

and other such documentation is required. At no time can any settlement be approved

solely on the basis to avoid condemnation proceedings.

F. Some authority relative to recommending/approving an administrative settlement may

be delegated to the realty specialist at the direction of the District Program Manager

with the concurrence of the Director. The extent of the delegation will depend on the

experience of the realty specialist and the amount of the administrative increase

involved.

G. Proposed settlements beyond any delegated authority must have prior approval of the

Director or the Manager, Bureau of Technical Support.

H. Proposed settlements above the fair market value must be accompanied by written

justification, signed by the person authorizing the settlement, when the case is

submitted for management review.

I. No supervisor shall delegate his/her administrative settlement authority under any

circumstances.

J. The fact that a possible settlement requires the realty specialist to obtain authorization

from a supervisor and then to secure an agreement, does not constitute the realty

specialist performing supervisory duties. Rather, this is a system check and balance to

ensure the appropriate expenditure of public monies. Processing of the case from the

point of settlement authorization forward is handled in the routine manner.

K. Realty Specialist Trainees must get approval from their assigned Realty Specialist 3 for

all settlements above Fair Market Value regardless of the amount.

3.9 Standing Crop Payment Procedure

The Standing Crop benefit is a separate payment for the loss of income from standing crops

impacted by the acquisition and is not a part of the real property acquisition. It is given

a separate valuation that is not considered as part of the real estate appraisal. Annual crops

(emblements) will be normally be allowed to be harvested from the acquisition area

and if so removed are not paid for. (N.J.A.C. 16:5-2 et seq.)

Making the Standing Crop Offer

The Standing Crop benefit valuation will be completed within 90 days of the filing of a

claim, or as soon thereafter as practical for completion of the valuation process.

If the standing crop offer is made during negotiations, the amount of the estimated farm

crop income offer shall be listed on a written offer letter provided to the owner as a

separate benefit amount. The negotiators call-data is to include records of discussions,

meetings, decisions, and other details related to the Standing Crop benefit. If the

claim is made before or after negotiations, a separate offer will be made.

APPEALS

Appeals from a Department finding of ineligibility or of the amount of the Standing Crop

valuation shall be available in accordance with N.J.A.C. 16:6-3.3.

FEDERAL-AID REIMBURSEMENT

FHWA reimbursement eligibility for Standing Crop benefits under N.J.S.A. 20:3-29.1 on a

federally funded project should be determined at the time the offer is calculated. If they

are not eligible for reimbursement to the State, then such payments must be treated as

NP or paid as state funds.

CONDEMNATION

Prior to the State taking possession of the property pursuant to a condemnation action, the

valuation of the standing crops will be updated to reflect the reduced average remaining

productive life of the crop and to also eliminate crop income "harvested" by the farmer.

This updating will be accomplished and reviewed in the same manner and through the

same process as the updating of any other evaluation report.

3.10 Cemetery Property

Cemetery properties consist of several types, Governmental run cemeteries, Cemetery

Corporations and Religious Cemeteries. N.J.S.A. 45:27-1, the "New Jersey Cemetery Act,

2003" applies to the operation of Cemetery Corporations and governs transfer of land and

or land and grave sites. Under N.J.S.A. 45:27-34 (f) the responsibility and expense for

removal and reburial shall be borne by the condemnor, not by the cemetery. N.J.S.A.

26:6-37. Disinterment’s; when allowed; permits No dead body shall be disinterred or

removed from any grave, tomb or burial place within this State except by direction of a

competent court of this State for the purpose of criminal investigation or upon permit being

given therefor by the local board in the locality where the body is interred or entombed.

3.11 Leases

A. Agreement Cases - The real estate agreement should refer to and include as an exhibit,

the appropriate residential/commercial lease agreement with the owner or any tenants

in occupancy. The lease agreement between any remaining occupants and the

Department should provide for the lease taking effect upon the date of closing. An

agreement should not be executed by the owner, nor accepted by the Department, until

a lease(s) is executed by the owner and/or occupants of the premises. The lease

agreement should terminate all prior leases. The Department representative at the

closing should verify that there are no new occupants in the premises to be conveyed.

B. Condemnation Cases - In accordance with our Eminent Domain Statute, any leasehold

interest is condemned along with the fee interest. That Statute provides that the

Department is entitled to rents, issues and profits twenty days after Service of Process.

Nevertheless, the Department should endeavor to secure leases from holdover

occupants on condemnation properties. If any existing leases contain a condemnation

clause, the owner should be asked to provide the appropriate notice to any lessees.

C. All lease agreements should be included with all agreement packages. The package

must include justification for the lease rental amount of each lease. Appropriate

documentation reflecting the lease determination should accompany the lease package.

As occupants relocate, properties are secured by the district personnel.

D. Specifics regarding relocation assistance and property management are contained in

the Relocation and Property Management Sections.

3.12 District Preparation of the Case for Agreement/Condemnation

A. The realty specialist must supply the owner’s name and address; spouse’s name;

nature of taking; all tenant information; copy of the intent to condemn letter; and a

copy of the agreement and description, when the case is submitted to the Technical

Support Bureau.

B. If condemnation is necessary, the realty specialist shall transmit via certified mail return

receipt requested or approved delivery service, the “notice of intent to condemn” to the

owner. The notice shall contain a summary of the negotiations contacts and a

statement as to why condemnation is to be initiated.

The realty specialist shall respond to any questions generated from the owner by the

letter and settlement discussions may continue based upon the response from the

owner. A copy of the notice must be included in the acquisition package.

Once the “Intent to condemn” letter is sent, continued discussions with the owner or

counsel should not be characterized as negotiations, but rather as “settlement

discussions.”

It is important that any communications after the letter is sent clearly indicate that

negotiations are not being resumed. Failure to make this clear to the owner may impair

our ability to file the Complaint. If the realty specialist is unsure of what would be

characterized as negotiations, they should contact the DAG assigned to their District

for advice.

C. Upon the completion of bona fide negotiations, resulting in either the execution of an

agreement by the owner, or the decision that further negotiations would not be

productive; the Realty Specialist shall prepare the case for transmittal to the Technical

Support Bureau for closing on the agreement or the initiation of the eminent domain

process.

1. To ensure prompt payment to the owner, the case file shall be transmitted to the

Technical Support Bureau within five working days of the receipt of the executed

agreement from the owner. The case file should contain the following items:

2. A Department Action signed by the District Program Manager, recommending the

appropriate disposition of the parcel

3. The Case Summary Form (which contains a summary of the specialist’s negotiations

call data). This must be reviewed and approved by the specialist’s Realty Specialist

4 or project supervisor

4. Copies of all appraisal/non-real estate and Standing Crop reports and

correspondence with the owner/counsel

5. The comparable sale or lease exhibit for cases being submitted for condemnation

6. The original and copy of the executed agreement (where appropriate) and the

agreement shall be assembled in the following order: consideration page, parcel

description, subordinate clauses concerning title, environmental clauses and

signature page(s)

7. Cut outs of the parcel/condemnation and entire tract maps

8. Confirmation of offer letter; environmental screening letter/ environmental

investigation reporting process cost report

9. Copy of “intent to condemn” and access clearance letters

D. The Realty Specialist 4 is responsible for ensuring that the case file is complete and

accurate prior to transmittal to the District Program Manager and to see that all

applicable documents are uploaded to the PAECETrak data base. At this point, the case

file shall be separated into (1) a permanent file which will be retained after final

disposition of the case; and (2) a temporary file which shall be retained only until

payment has been made, after which it can be discarded.

E. The Realty Specialist 4 is responsible to ensure that all documents received and sent to

the owner, internally produced documents and call data are included within the

PAECETrak database. Appraisals and appraisal reviews should also be scanned until

such time as they can be directly uploaded by the appraiser into the database. For the

interim period when the appraiser is unable to upload a report directly, the appraiser

should submit the report in a PDF format for the District to upload. The agreement,

Department Action and any other documents requiring signatures will be transmitted

to Headquarters for approval, at which time they will be uploaded into the PAECETrak

system. Cases submitted for agreement or condemnation will include a certification

certifying that all completed documents have been uploaded into PAECETrak.

Certification will be made on a checklist to be included as part of the case transmittal.

F. Subject to extenuating circumstances and with the approval of the Supervisor of the

Closing Section, the date of vacation in the real estate agreement shall normally be at

least 90 days from the anticipated date of its approval by the Director, Division of Right

of Way and Access Management. This will assure that the deed will have been delivered

and the Title Section will be prepared to conduct a closing and make final payment as

of the stipulated date of vacation of the premises contained in the agreement.

3.13 Processing of Case by Headquarters Technical Support

A. Upon receipt of the case file from the District Office, the Technical Support Bureau

transmits the case to the Funding Unit for confirmation that funds are available. Upon

confirmation of the available funds, the case is transmitted to the Director for approval

of the Department Action and execution of the agreement forms; or alternatively for

approval to initiate the eminent domain process. Upon authorization to initiate the

eminent domain process, the Technical Support Bureau transmits a case file to the

Division of Law, Transportation Section for preliminary review and comments. The

response from the Division of Law, Transportation Section should be within 30 days.

B. The executed original agreement is sent to the District Office for mailing or hand

delivery to the owner by the realty specialist. Copies of the agreements and the parcel

file are transmitted to the Legal Processing Section for closing on the agreement and

payment to the owner. The Titles Section sets forth the policy and procedure for all

title related activities.

C. Upon receipt of the complaint, map and title update, the Technical Support Bureau will

transmit the file to the Legal Processing Section for initiation of condemnation. This

package will include the (a) approved Department Action, (b) case summary, (c)

appraisals/non real estate reports, (d) complaint map and description, (e) offer letter,

(f) intent to condemn letter, (g) environmental summary memorandum/ environmental

investigation reporting process cost report and (h) the sale or lease exhibit. Please

refer to the Legal Processing Section for the processes followed to condemn property

that cannot be acquired by agreement.

D. The decision to accomplish additional court deposits, in any given case, shall be

predicated upon a consultation between the assigned DAG, Condemnation Coordinator

from the District or the Legal Processing Section Supervisor.

3.14 Quality Control

A. Quality control in the acquisition process is primarily the responsibility of the District

office realty specialist assigned responsibility for the negotiations on a particular case.

The realty specialist is responsible for the quality of negotiations and the proper

preparation and execution of the real estate agreement; or alternatively, of assuring

that all requirements have been met for the initiation of the condemnation process.

The Realty Specialist 4 or Realty Specialist 3 is responsible for audit of the realty

specialist’s case file.

B. It is the responsibility of the District Program Manager to ensure that acquisition

activities are accomplished in accordance with State and Federal Law and Regulation.

C. Upon transmittal of the case file to Technical Support for processing of the real estate

agreement or the initiation of the condemnation process, the case file is audited by the

Technical Support Bureau. If the case file is deficient in any substantive matter that

would impair the processing of the case, the case is returned to the District Program

Manager with a written critique of the deficiencies. The Technical Support Bureau

retains a record of the deficiencies as a tool to determine areas needing improvement

and to develop staff training programs.

D. On an annual basis, the Technical Support Bureau will select one or more experienced

District Office Realty Specialist 3 staff which will comprise a quality review team. The

FHWA Division Right of Way Officer may, at his/her discretion, participate as a member

of the team. The team shall perform a quality review of selected cases within each of

the District offices and issue a report as to their findings. Corrective action/training

will follow as determined necessary by the findings of the report. In the event that the

FHWA Division Right of Way Officer does not participate as a member of the team, a

copy of the report will be provided to the FHWA Division Office.

Section 4 Relocation & Property Management

4.1 Introduction

This section describes the organization and the procedures by which Relocation Assistance

and Property Management activities shall be accomplished so as to comply with the Federal

Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as

amended. The NJDOT is required to conduct all relocations in accordance with federal

regulations, except where state statute requires a higher payment than the federal

regulations, in which case the state statutory amount will be used. Authority to use federal

relocation standards is provided under the Uniform Transportation Replacement Housing

and Relocation Act, N.J.S.A. 27:7-72 et seq.

The Technical Support Bureau, in the Division of Right of Way and Access Management is

responsible for guidance on property management issues and technical support for

relocation issues for the Districts. The responsibility for the provision of relocation

assistance and payments rests with the Right of Way District Offices. The District Program

Managers have the responsibility of implementing the provisions of the Uniform

Transportation Replacement Housing and Relocation Act and have the primary

responsibility for ensuring compliance with the state and federal relocation laws and

regulations.

Each District Office will have one or more real property acquisition teams, whose function

will be to negotiate for the purchase of the right of way; to prepare cases for agreement

and condemnation; to assist in the condemnation of parcels and to provide relocation

advice and relocation assistance and payments to persons whose property is acquired for

transportation projects.

Relocation advice and assistance must comply with all State and Federal laws and

regulations regarding discrimination. The Department has a zero tolerance policy

regarding activities which are discriminatory in nature.

The relocation process begins at the preliminary plan submission phase, when district

personnel or the LPA develop a cost estimate for the relocation of residential and

commercial occupants. Prior to the initiation of the appraisal process, site surveys are

completed for each occupant and a Workable Relocation Assistance Plan prepared.

Each residential occupant must be considered to determine potential eligibility for an

owner/tenant replacement-housing supplement. The owner housing supplements are

prepared immediately upon the registration of the fair market value and any supplement

is offered to the owner with the tender of the fair market value. Tenant residential

supplements are prepared and offered to tenant occupants promptly after the offer to the

owner. The tenant should continue to pay the owner the existing rent, and remain in the

dwelling until a replacement site is approved as decent safe and sanitary. Both residential

and commercial occupants are eligible for reimbursement for moving costs.

4.1.1 General Requirements

The District Office shall conduct an advisory assistance program which satisfies Federal

and State requirements and offers the services described in this section. If it is determined

that a person occupying a property adjacent to the real property acquired for the project

is caused substantial economic injury because of such acquisition, advisory services may

be offered to such person.

The realty specialist should constantly keep in mind that the displaced person or business

is being forced to relocate by virtue of the need to construct the proposed transportation

improvement The realty specialist should be creative in anticipating the needs of the

person/business and call upon all available private and public resources to minimize the

impact of the relocation.

Relocation benefits are normally provided on a “spend to get” reimbursement basis. In

the event that the relocatee needs less than the maximum allowable benefit, the actual

amount spent will be the limit of the benefit. Any amount spent by the relocatee above

the maximum allowable benefit will be the responsibility of the relocatee.

4.1.2 Public Information

To assure that the public has adequate advance and continuing knowledge of the relocation

program, the Department shall present information and provide opportunity for discussion

of relocation services at public hearings and provide copies of the relocation brochure. The

District Office shall be responsible for the presentations. The Office of Community

Involvement shall notify the District Program Manager as to the time and place of hearings

and information centers and the Manager will arrange to have staff present to provide the

information. The presentation shall include, at a minimum, the following information:

The availability of relocation assistance and advisory services, eligibility requirements and

payment procedures

The estimated number of individuals, families, businesses, farm and non-profit

organizations that are to be displaced and subsequently relocated by each of the

alternatives under consideration

The studies that have been or will be made and the methods that will be followed to assure

that housing needs of the relocatees will be met.

Copies of the relocation brochure and other literature, as applicable, shall be distributed at

the hearings and/or information centers.

4.1.3 Relocation Brochure

The District Program Managers are responsible for obtaining necessary copies of “The

Relocation Assistance Program Your Rights And Benefits If You Must Move For Businesses,

Farms, and Non-profit Organizations” and “The Relocation Assistance Program Your Rights

And Benefits If You Must Move For Residential Occupants”. The brochures describe the

relocation program and will be distributed without cost at public meetings. In order to

give proper information and assistance to relocatees, every effort should be made to

communicate with them in their language, including interpretation of the brochure into the

displacee’s language.

4.1.4 Relocation Information for Owner/Tenant Occupants

Promptly following authorization to acquire and prior to the initiation of negotiations, the

booklet for How Property is Purchased for Highway and Public Transit Projects and if

applicable a relocation booklet and a general relocation notice letter explaining the process

shall be mailed to all occupants. In the case of an owner occupied residential properties,

the relocation letter and booklet will be hand delivered. The relocation booklet can also be

hand delivered to business displacees. This notice will advise that there will be subsequent

notice of relocation eligibility that will provide specifics about the benefits for which they

are eligible.

This relocation notice shall state that the occupant is not required to move until and unless:

an agreement has been executed and payment made; or for when negotiations having

failed, a court deposit has been accomplished and the Commissioners have been appointed

and the occupant has been provided with a thirty and a ninety day notice to vacate; and

at least one comparable replacement dwelling has been “made available” to the relocatee

for residential occupants. A comparable replacement dwelling will be considered to have

been made available to a person if the person is informed of its location, has sufficient

time to negotiate and enter into a purchase agreement or lease for the property and the

person is assured of receiving relocation assistance and the acquisition payment in

sufficient time to complete the purchase or lease of the property and the comparable has

been determined by the realty specialist to be decent, safe and sanitary. The relocation

letter shall also explain the relocation benefits that the occupant may be eligible for.

For all tenant occupants the relocation brochure together with an informational relocation

letter shall be provided to inform the relocatee that relocation advisory assistance will be

provided and the relocatee may be eligible for relocation payments. The relocation letter

shall explain the relocation payments that the occupant may be eligible for. The letter will

state that the tenant is not required to vacate until an agreement has been executed and

the property owner has been paid; or for when negotiations having failed, a court deposit

has been made and the Commissioners have been appointed and the occupant has been

provided with a 30 and a 90 day notice to vacate. The letter shall also state that the

tenant will be notified when an agreement has been executed or condemnation instituted

and until that time, they should continue to pay rent to the owner and that their lease

remains in force with the Owner until such time as the Department becomes the owner

through payment under an agreement or condemnation. Once the owner has been paid

for the property by the Department, all rental payments due shall be paid to the

Department.

Negotiations cannot be initiated until the acquisition agent sends or delivers the relocation

letter and brochure to the displacees. The realty specialist shall enter the date of the

mailing of the letters and names of the occupants notified in the data base and on their

relocation call data sheet. This notation will serve as a permanent record that negotiations

were not initiated until all occupants had been notified of the relocation assistance

program.

4.1.5 Tracing Relocatees

Records shall be maintained of all relocations. The realty specialist will attempt to trace

any occupants who move from the taking area (after the initiation of negotiations) without

our knowledge. If an occupant cannot be located within a 30 day period, a record shall be

made of the actions taken and the case closed without further action.

4.2 Relocation Planning

Data will be developed documenting that displacements will not exceed available housing

resources. During project scoping, projects shall be planned in such a manner that the

problems associated with the displacement of individuals, families, businesses, farms and

non-profit organizations are recognized and solutions are developed to minimize the

adverse impact of displacement. Planning shall precede any action which will cause

displacement and should be scoped to the complexity and nature of the project.

Solutions to problems, which may involve a relocation study, will be developed and include

an evaluation of resources available to accomplish relocations.

The needs of every individual to be displaced will be evaluated and compared with available

decent, safe and sanitary housing to ensure that an inventory of currently available

housing is provided. Concurrent displacement by other agencies should also be assessed.

4.2.1 Individual Relocation Plan

During the initial and subsequent personal contacts, the realty specialist and the occupant

shall mutually develop a relocation plan. This plan will specify the preferred type, size and

location and price range for relocation housing, and the replacement business locations,

as well as the timing of the move and the need for other supporting services. This plan

for a business will take into consideration the needs and strategies developed during the

interview conducted during the site survey.

4.2.2 Locating a Satisfactory Unit

The realty specialist shall provide the following:

A. Listings of available and suitable sale/rental housing units and business sites;

B. Transportation to inspect replacement units;

C. An inspection of the replacement property selected by the occupant to ensure that the

property is decent, safe and sanitary;

D. Assistance in applying for public housing and in establishing their priority;

E. Assistance in arranging financing for their new home or business relocation, including

liaison with the Federal Housing, Veterans or Small Business Administrations and other

lending institutions; and

F. Referrals to other supporting agencies and organizations to properly assist the family

or business.

4.2.3 Civil Rights

The acquisition agent shall inform relocatees of their rights and options in selecting

replacement housing in areas of their choice and assist relocatees in ensuring against

discriminatory practices in the purchase/rental of residential units on the basis of race,

color, religion, sex, national origin, or handicap.

4.2.4 Relocation Housing/Business Summary and Lead Time Analysis

Replacement housing requirements shall be compared with the availability of replacement

housing in all categories. The availability of housing will determine the time necessary to

effect the relocation of the families and the overall time required to complete the

acquisition of the right of way. Needs for businesses, non-profit organizations and farms

shall also be analyzed to determine the lead time required. An analysis of the commercial

market will prove effective during scoping, in estimating the time required for business

moves and the probable availability of replacement sites. Additional information regarding

this topic is referenced in Section 4.2.3.

4.2.5 Local Site Office

A local site office will be established when it has been determined that there is a need for

a site office because of the number of residential and commercial occupants anticipated to

have to be relocated, the distance of the job site from the District Office, and the lack of

available transportation. Any potential field office site will have to be easily accessible to

those that may need relocation assistance as a result of the projected project. The office

should be located convenient to public transportation or within walking distance for those

to be relocated. The District Program Manager shall make the determination for the

establishment of a field site office during scoping or as early as possible to permit sufficient

time to open the office concurrent with the initiation of negotiations. Site offices shall be

open during hours convenient to the persons to be displaced and shall include being

open at least one evening per week.

The site office shall maintain: current lists of replacement dwellings, suitable in price, size

and condition for displaced persons; multiple listing services; data regarding security

deposits, closing costs, down payments and interest rates/terms; maps showing the

location of public facilities, public transportation routes; and current listings of commercial

properties and the Federal relocation brochures.

4.2.6 Preparation of the Workable Relocation Assistance Plan

All projects will have a Workable Relocation Assistance Plan (WRAP) prepared before any

appraisal plan will be approved or before any negotiations are to start. The WRAP will be

prepared by the appropriate District and a copy will be provided to the Manager of

Technical Support. The WRAP is required to be reviewed and approved by the Manager of

Technical Support prior to the final approval of the District Appraisal plan. The purpose of

the workable relocation assistance plan is to secure, through site surveys, the data

necessary to determine the number and needs of the persons, families, businesses and

non-profit organizations or governmental agencies being displaced from the project. Site

surveys shall be secured as necessary by personal contact. Occupancy data should be

matched against the supply of present and future projected housing availability, as well as

the ability of supporting services and agencies to assist with special problems. The WRAP

contains 9 sections in addition to a cover memorandum and a table of contents. The

sections are as follows:

A. Project Location and Summary of Project

This section provides an overview of the project, its purpose, its location and the

number of parcels to be acquired, along with a breakdown between the number of

partial and entire take parcels. In addition there shall be a mention of the number of

parcels that will require relocation. In the event that there are no relocations, a

statement will be made as to a negative relocation impact and only the completed site

surveys will be needed.

B. Summary of the Anticipated Relocations

This section is to include the total number of parcels with anticipated relocations,

excluding sign only relocations or relocations involving only personal property, such as

storage trailers, sheds, construction materials. The total number of parcels with

anticipated relocations should be broken down as to the total number of owner occupied

and total number of tenant occupied commercial relocations, the total number of owner

occupied and tenant occupied residential relocations, and the total number of non-profit

or governmental agency owner or tenant occupied relocations. A separate statement

shall be made as to the number of parcels that require the relocation of signs and a

statement as to the number of parcels that require only the relocation of personal

property. Refer to Section 4.17.1 regarding the policy pertaining to advertising signs.

C. List of parcels with Anticipated Relocations

This section provides a list of all the parcels with a description of the type of relocation

for each parcel with an anticipated relocation. A notation shall be made next to those

parcels that will require additional special assistance, such as a home owner that is

disabled and confined to a wheel chair or a business that has operations that are

regulated by another agency or is complex such that it will require a lengthy period of

time to relocate.

D. Site Relocation Office and Personnel Requirements

This section details whether or not a site office will be required, and what potential sites

are available for a site office. (The need for a site office will depend on several factors,

the number of residential and commercial occupants anticipated to have to relocate,

the distance of the job site from the District Office, and the availability of transportation.

Any potential field office site will have to be easily accessible to those that may need

relocation assistance as a result of the projected project.) In addition this section shall

list the number of personnel required to adequately provide relocation services and as

to whether any will need to be bi-lingual.

E. Residential Units Available for Sale or Lease

This section includes available residential listing for sale and for lease as required. If

there are no residential relocations anticipated, then a “Not Applicable” statement will

apply. There must be at least one residential property available with comparable rooms

and size for each one listed that is anticipated to be acquired and that require the

relocation of an owner occupant. There must be available at least one comparable

rental unit, with the required number of bedrooms, for each residential tenant

anticipated to be displaced.

F. Commercial Properties Available for Sale or Lease

This section lists available commercial listings for sale or lease as required by the type

of commercial, non-profit or governmental anticipated relocations.

G. Time Required and Concluding Comments

This section identifies a projected amount of time needed from the start of negotiations

to complete all the relocations. In addition this section shall offer any additional

comments that may be warranted given the nature of the relocations, particular

whether or not there will be anticipated problem relocations.

H. Table of Parcels with Breakdown of Anticipated Relocations

This table lists each parcel and the number of relocations required per parcel for each

type of anticipated relocation, as applicable.

I. Signed Copies of the Completed Site Surveys

Each site survey shall be completed, with a photo attached of the taking area and

signed by the Reality Specialist who obtained the information.

4.3 Temporary Displacement

Persons not displaced. Section 24.2 (a)(9)(ii)(D) of this section recognizes that there are

circumstances where the acquisition, rehabilitation or demolition of real property takes

place without the intent or necessity that an occupant of the property be permanently

displaced. Because such occupants are not considered "displaced persons" under this part,

great care must be exercised to ensure that they are treated fairly and equitably. For

example, if the tenant-occupant of a dwelling will not be displaced, but is required to

relocate temporarily in connection with the project, the temporarily occupied housing must

be decent, safe, and sanitary and the tenant must be reimbursed for all reasonable out-

of-pocket expenses incurred in connection with the temporary relocation. These expenses

may include moving expenses and increased housing costs during the temporary

relocation. Temporary relocation should not extend beyond one year before the person is

returned to his or her previous unit or location. The Agency must contact any residential

tenant who has been temporarily relocated for a period beyond one year and offer all

permanent relocation assistance. This assistance would be in addition to any assistance

the person has already received for temporary relocation, and may not be reduced by the

amount of any temporary relocation assistance. Similarly, if a business will be shut-down

for any length of time due to rehabilitation of a site, it may be temporarily relocated and

reimbursed for all reasonable out of pocket expenses or must be determined to be

displaced at the Agency's option. Any person who disagrees with the Agency's

determination that he or she is not a displaced person under this part may file an appeal

in accordance with 49 CFR part 24.10 of this regulation.

4.4 Relocation Advisory Services

4.4.1 Initial Personal Contact

At the time of initiation of negotiations with the owner or in the case of a tenant,

subsequent to the initiation of negotiations, but no later than two weeks after the start

of negotiations, the occupants must be advised, by personal contact, as to their eligibility

for relocation payments and advisory assistance. These items are covered in the relocation

brochure, which must be provided to the occupant during the initial personal contact and

explained in the relocation letter. All occupants shall be personally provided an explanation

of the moving reimbursement amounts and options available to them, as well as the

requirements to secure reimbursement. In those instances where the relocatee is unwilling

to meet the realty specialist, then a certified letter shall be sent to the relocatee which will

explain the relocation advisory services available, as well as to the types of relocation

payments that the relocatee may be eligible for. The relocation booklet will accompany

the letter.

At the initial personal contact, each occupant shall be informed:

A. That they are not required to move until an agreement has been executed and payment

made or a deposit of fair market value along with the appointment of Commissioners

has been accomplished;

B. That they are not required to relocate without first being provided with a 90 day written

notice to vacate or indicating they have at least 90 days to vacate that they will receive

an additional 30 day notice to vacate. The 30 day notice to vacate will only be sent

out after the condition in the preceding paragraph has been met and for residential

occupants at least one comparable housing unit that is decent, safe and sanitary has

been offered;

C. That tenants should continue paying rent to the owner; and the possibility that they

may be able to remain in occupancy after acquisition of the premises under a lease

with the Department;

D. of the availability of suitable private sales/rental/housing;

E. That under 42 USC § 4636 no payments received shall be considered as income for the

purposes of the Federal Internal Revenue Code, or for determining the eligibility of any

person for assistance under the Social Security Act, the recipient should consult with

his or her tax advisor regarding these payments.

F. The procedures to be followed to appeal a determination as to eligibility for or the

amount of benefits are described in the relocation booklet and in the appeal section of

this Manual.

Personal contacts may be conducted either in the occupant’s home, project office or the

District Office, at the occupant's option. In all instances, the initiative and responsibility to

make such personal contact rests with the realty specialist. Should the occupant refuse to

meet after reasonable efforts, a record of the attempted contacts shall become a part of

the relocation call data and alternative steps shall be taken to contact and assist the family.

Case assignments and the date by which the initial personal contact is to be made shall be

entered into the database as well as onto the realty specialist relocation call data sheet for

the relocatee. The realty specialist shall be furnished with a copy of the site survey and

the Realty Specialist’s Report section of the Case Summary shall be kept current and

personal contacts continued for all aspects of the relocation until the occupant has

successfully relocated.

4.4.2 Relocation Call Data

Realty specialists will keep separate relocation call data for each relocatee. The relocation

call data will maintain a record of all correspondence sent out to the relocatee and received

from the relocatee and or their representative, all phone conversations related to the

relocation of the relocatee, all meetings and all actions taken with regard to the relocation

of the relocatee. The call data shall indicate when the relocatee has vacated the property

being acquired and where the relocatee has relocated to. All payments received by the

relocatee must be recorded on the call data.

4.4.3 Relocation Records

The District Program Manager shall be responsible for ensuring the maintenance of the

records of displacement activities in sufficient detail to ensure compliance with Federal and

State regulations. Records shall be maintained for at least three years after all displaced

persons receive final payment. The Realty Specialist 4 or other assigned supervisor will

certify that all relevant documents have been uploaded into the database system.

Certification will be made on a checklist to be included as part of the case transmittal. The

realty specialist relocation call data shall contain:

A. The names and addresses of displaced persons

B. Their original and new addresses and telephone numbers

C. Personal contacts made with each displaced person, including the name of the

acquisition agent or others providing relocation assistance

D. An indication as to whether the offer of assistance was declined or accepted and the

name of the individual accepting or declining the offer

E. The dates and substance of subsequent follow up contacts

F. The date on which the displaced person was required to move from the property

G. The date on which the actual relocation occurred and whether the relocation was

accomplished with the assistance of the realty specialist

H. The amounts of all relocation payments made and the dates made

I. The dates of all notices sent, including but not limited to the relocation benefit letter,

the moving cost authorization letter, the 90 day notice to vacate, the 30 day notice to

vacate as well as other relevant notices.

J. All relevant actions taken in regard to the relocation of the displacee/relocatee. A file

shall be maintained for each relocatee, with all materials in chronological order and

firmly secured in the file folder.

The use of the ROW database for storage of records is required.

4.4.4 Annual Federal Reports

Statistics concerning acquisition activities and relocation assistance and payments (in

accordance with 49 CFR Part 24, Appendix B) are required by the Federal Highway

Administration as soon as possible subsequent to September 30, but not later than

November 15 of each year and the reporting period is October 1 through September 30.

The Manager, Technical Support, based upon data furnished by the District Program

Managers, is responsible for submitting the reports on a timely basis to the Federal

Highway Administration.

4.5 Status of a Displacee in the United States

Each person seeking relocation payments or relocation advisory assistance shall, as a

condition of eligibility, certify on an NJDOT approved CERTIFICATION CONCERNING LEGAL

RESIDENCY:

1. In the case of an individual, that he or she is either a citizen or national of the United

States, or an alien who is lawfully present in the United States.

2. In the case of a family, that each family member is either a citizen or national of the

United States, 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 either a citizen or national of the United States, 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.

The certification provided pursuant to paragraphs (1), (2), and (3) of this section shall

indicate whether such person is either a citizen or national of the United States, or an alien

who is lawfully present in the United States. Requirements concerning the certification in

addition to those contained in this rule shall be within the discretion of the FHWA and,

within those parameters, that of the displacing Agency.

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 legally 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.

The displacing Agency shall consider the certifications provided pursuant to this process to

be valid, unless the displacing Agency determines as set forth below that it is invalid based

on a review of an alien's documentation or other information that the Agency considers

reliable and appropriate.

Any review by the displacing Agency of the certifications shall be conducted in a

nondiscriminatory fashion. Each displacing Agency will apply the same standard of review

to all such certifications it receives, except that such standard may be revised periodically.

If, based on a review of an alien's documentation or other credible evidence, a displacing

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. If the Agency has reason to believe that the certification of a person who has

certified that he or she is an alien lawfully present in the United States is invalid,

the displacing Agency shall obtain verification of the alien's status from the Bureau

of Citizenship and Immigration Service (BCIS) online SAVE Program

(https://www.uscis.gov/save) or through a local BCIS office

(https://www.uscis.gov/about-us/find-uscis-office).

2. If the Agency has reason to believe that the certification of a person who has

certified that he or she is a citizen or national is invalid, the displacing Agency shall

request evidence of United States citizenship or nationality from such person and, if

considered necessary, verify the accuracy of such evidence with the issuer.

No relocation payments or relocation advisory assistance shall be provided to a person who

has not 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

displacing 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 is an alien lawfully admitted for permanent residence

in the United States.

The phrase “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:

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 displacing Agency determines will have a significant and

demonstrable adverse impact on such spouse, parent, or child.

The certification referred to above will be included as part of the claim for relocation

payments. The information regarding this process is to be entered into the ROW database.

4.6 Department of Labor Mine Safety Act

Safety precautions concerning mines, sand pits, quarries, gravel pits, and shale pits are

governed by the provisions of the Mine Safety Act, N.J.S.A. 34:6-98.1 et seq. This Act

ensures that owners of properties provide protection to the public. Prior to acceptance of

possession of such a property, the District Program Manager shall arrange to accomplish

steps necessary to assure compliance with the Act.

4.7 Residential Relocations

4.7.1 Special Replacement Housing Needs

Families or individuals whose age and/or health may be such as to require special

relocation housing (nursing homes, senior citizen housing) should be assisted through

referral to appropriate supporting agencies. If language barriers exist, the District Program

Manager will request assistance from the Manager of the Bureau of Technical Support in

obtaining the services of a bilingual employee within the Department or within another

State, County or Municipal government agency to assist in communicating with the

potential displacee. If none is available, the District Program Manager may obtain the

services of a translator.

4.7.2 Estimating and Developing Housing Resources

Private Sale and Rental Housing available should be based on the market and what is

actually listed as available. At no time shall the realty specialist refer anyone to persons,

brokers or builders, on an individual basis. Any owner asking to have a property listed

shall furnish an anti-discrimination certification, stating that the owner will abide by all

open housing regulations and that he/she will not discriminate against any individual or

family on the basis of race, color, religion, sex, national origin, or handicap.

4.7.3 Replacement Housing of Last Resort

Last resort housing must be justified on a case by case basis giving appropriate

consideration to:

1. Availability of comparable replacement housing in the program or project area.

2. Resources available to provide comparable replacement housing.

3. Individual circumstances of the displaced persons.

4. The method selected for providing last resort housing assistance must be cost

effective, considering all elements that contribute to total project costs.

Occupants of less than 90 days prior to initiation of negotiations and persons occupying

the property subsequent to the initiation of negotiations, but prior to the acquisition of the

property, may be eligible for a replacement housing payment under this category.

Last resort housing may be provided by:

1. Provision of a replacement housing supplement in excess of $7,200 for tenants and

$31,000 for owners.

2. Rehabilitation of and/or additions to an existing dwelling.

3. Construction of a replacement dwelling.

4. 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.

5. The relocation and, if necessary, rehabilitation of a dwelling.

6. Purchase of land and/or a replacement dwelling by the Department and its

subsequent sale or lease to, or exchange with, a displaced person.

7. Removal of barriers to the handicapped.

8. Change in status of the displaced person with his or her concurrence, from tenant

to homeowner, when it is more cost effective to do so (cases where a down-payment

may be less expensive than a last resort housing rental assistance payment).

9. Subsequent residential tenants, those that move in after the initiation, of

negotiations and before NJDOT takes ownership of the property, may be eligible for

last resort housing.

4.7.4 Residential Relocation Services to be Provided

The advisory assistance program shall:

A. Determine the relocation needs and preferences of each person to be displaced

B. Explain the relocation payments and other assistance for which the person may be

eligible as well as the eligibility requirements;

C. Describe the procedures for obtaining such assistance and payments;

D. Provide current and continuing information on the availability, purchase prices and

rental costs of replacement properties;

E. Explain that a residential occupant cannot be required to move unless at least one

comparable replacement dwelling is made available; and

F. Minimize hardships to persons in adjusting to relocation by providing counseling and

advice as to other sources of assistance that may be available.

Replacement Housing offered to a relocatee shall be inspected prior to being made

available to the relocatee to assure that the housing meets applicable standards and that

it is Decent, safe and sanitary, and available.

As soon as practicable, the realty specialist shall inform the relocatee, in writing, of the

specific comparable replacement housing and the price or rent used for establishing the

upper limit of the replacement housing payment and the basis for the determination, so

that the person is aware of the maximum replacement housing payment to which he/she

may be qualified. No comparable replacement housing shall be selected for the purpose of

calculating the replacement housing supplement without having first been inspected and

determined to be decent, safe and sanitary and no housing supplement payment shall be

made without the realty specialist first verifying that the housing that the relocatee is

anticipated to relocate to is decent, safe & sanitary and available. Minority occupants shall

be afforded reasonable opportunities to relocate to housing not located in an area of

minority concentration and that is within their financial means. This policy does not require

the provision of a larger housing supplement than would be necessary to enable the person

to relocate to a comparable replacement dwelling.

All persons shall be offered transportation to inspect housing to which they are referred.

Assistance shall be provided to a business or farm to obtain and become established in a

suitable replacement location. Any person, whose occupancy of an acquired property

began subsequent to the acquisition of the property, shall be eligible for relocation advisory

services.

4.7.5 Comparable Replacement Dwelling Determination

A dwelling which meets applicable housing and occupancy codes, along with the standards

set forth by the FHWA and enumerated below. In limited circumstances these standards

may be waived for good cause by the Director, Right of Way & Access Management, with

the concurrence of the Federal Highway Administration or other Federal agency providing

funding for a project. The dwelling shall be the following:

 Structurally sound, weather tight and in good repair.

 Have a safe electrical wiring system adequate for lighting and other devices.

 Have a heating system capable of sustaining a temperature of approximately 70

degrees.

 Is adequate in size with respect to the number of rooms, particularly bedrooms, and

area of living space needed to accommodate the displaced person(s). The number

of persons occupying each habitable room used for sleeping purposes shall not

exceed that permitted by local housing codes or the policies of NJDOT. The NJDOT

will follow the requirements for separate bedrooms for children of the opposite

gender included in local housing codes. In the absence of local codes, NJDOT policy

is that no more than 2 children of the same sex will be permitted to share the same

bedroom, and that no more than two adults shall occupy the same bedroom.

 There shall be a separate, well lighted and ventilated bathroom that provides privacy

to the user and that contains a sink, bathtub or shower stall and a toilet, all in good

working order and properly connected to an appropriate source of water and to a

sewage drainage system. 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; Contains unobstructed egress to safe, open space at ground level. If

the replacement dwelling unit is on the second story or above, with access directly

from or through a common corridor, the common corridor must have at least two

means of egress.

 Contain unobstructed egress to safe, open space at ground level.

For a displaced person with a disability, the dwelling shall be free of any barriers which

would preclude reasonable ingress, egress, or use of the dwelling by such displaced

person. Reasonable accommodation of a displaced person with a disability at the

replacement dwelling means the acquiring agency is required to address the needs of

persons with a physical impairment that substantially limits one or more of the major

life activities. In these situations, reasonable accommodation should include the

following at a minimum: Doors of adequate width; ramps or other assistance devices

to traverse stairs and access bathtubs, shower stalls, toilets and sinks; storage

cabinets, vanities, sink and mirrors at appropriate heights. Kitchen accommodations

will include sinks and storage cabinets built at appropriate heights for access. The

Agency shall also consider other items that may be necessary, such as physical

modification to a unit, based on the displaced person's needs.

4.7.6 Functional Dwelling Replacement Determination

The requirement in § 24.2(a)(6)(ii) that a comparable replacement dwelling be

"functionally equivalent" to the displacement dwelling means that it must perform the

same function, and provide the same utility. While it need not possess every feature of

the displacement dwelling, 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)(6)(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)(6)(ix). A public housing unit may qualify as a comparable replacement

dwelling only for a person displaced from a public housing unit. A privately owned dwelling

with a housing program subsidy tied to the unit may qualify as a comparable replacement

dwelling only for a person displaced from a similarly subsidized unit or public housing. A

housing program subsidy that is paid to a person (not tied to the building), such as a HUD

Section 8 Housing Voucher Program, may be reflected in an offer of a comparable

replacement dwelling to a person receiving a similar subsidy or occupying a privately

owned subsidized unit or public housing unit before displacement. However, nothing in

this part prohibits an Agency from offering, or precludes a person from accepting,

assistance under a government housing program, even if the person did not receive similar

assistance before displacement. However, the Agency is obligated to inform the person

of his or her options under this part. (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 § 24.402 would be computed on the basis

of the person's actual out-of-pocket cost for the replacement housing.)

4.7.7 Public Housing

Under Section 24.2(a)(6)(ix), a public housing unit may qualify as a comparable

replacement dwelling only for a person displaced from a public housing unit. A privately

owned dwelling with a housing program subsidy tied to the unit may qualify as a

comparable replacement dwelling only for a person displaced from a similarly subsidized

unit or public housing. A housing program subsidy that is paid to a person (not tied to the

building), such as a HUD Section 8 Housing Voucher Program, may be reflected in an offer

of a comparable replacement dwelling to a person receiving a similar subsidy or occupying

a privately owned subsidized unit or public housing unit before displacement. However,

nothing in this part prohibits an Agency from offering, or precludes a person from

accepting, assistance under a government housing program, even if the person did not

receive similar assistance before displacement. However, the Agency is obligated to

inform the person of his or her options under this part. (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 § 24.402 would be

computed on the basis of the person’s actual out-of-pocket cost for the replacement

housing.)

4.7.8 Residential Specific Relocation Definitions

A. Dwelling Site Section 24.2(a)(11)

The term 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, § 24.2(a)(11).)

B. Household Income 24.2(a)(14)

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, and the net income

from a business. It does not include income received or earned by dependent children

and full time students under 18 years of age. Household income does not include

program benefits that are not considered income by Federal law such as food stamps

and the Women Infants and Children (WIC) program. For a more detailed list of income

exclusions see Federal Highway Administration, Office of Real Estate Services Web site:

http://www.fhwa.dot.gov/real_estate/uniform_act/relocation/exclusions.cfm.

If there is a question on whether or not income from a specific program should be

included, the Federal Agency administering the program should be contacted.

4.7.9 General Residential Information Notices

As soon as practicable, a displaced person shall be furnished with a written description of

the relocation program which:

1. Informs the person that he or she may be displaced for the project and generally

describes the relocation payment(s) for which the person may be eligible. Prior to

this a general notification letter with relocation booklet should have been sent to

the tenant. This should occur once the project has been transmitted to the District.

If not, then it should be presented with the tenant relocation benefit letter.

2. Outlines the basic requirements for eligibility and the procedures for obtaining

relocation payment(s).

3. Informs the person that he or she will be given relocation advisory services,

including referrals to replacement properties and assistance in filing payment

claims.

4. Informs the person that he/she will not be required to move without at least 90 days

advance written notice.

5. That he/she cannot be required to relocate permanently unless at least one

comparable replacement dwelling has been made available.

6. Describes the person's right to appeal any determination as to benefits to which

they may be entitled.

7. Informs displacee of the time period that the displacee has to submit for relocation

benefits.

8. Informs displacee that under 42 USC § 4636 relocation “payments are not to be

considered as income for revenue purposes or for eligibility for assistance under

Social Security Act or other Federal law”. The recipient should consult with his or

her tax advisor regarding these payments.

4.7.10 Inspection of Relocation Housing

Prior to making a replacement housing payment or utilizing dwelling units available on the

market as comparable housing, the prospective replacement unit and comparables shall

be inspected to verify that the unit is decent, safe and sanitary and available. The assigned

realty specialist shall complete the dwelling inspection and listing record. In areas where

the local municipal housing code is stricter than that used by NJDOT for its D, S & S, then

those codes must be considered when determining whether or not the replacement or

comparable unit is D, S & S. Public housing units and FHA/VA financed units are exempted

from this requirement.

4.7.11 Action to Correct Substandard Units

A realty specialist will not knowingly make referrals to substandard units. If a family

accepts a unit against the advice of, or without the knowledge of the realty Specialist, the

Realty Specialist will inspect the dwelling to determine its condition; notify the owner of

the deficiencies found and encourage the owner to voluntarily correct any substandard

condition. If the deficiencies are not corrected, the Realty specialist shall refer the matter

to the local housing inspector and inform the relocatee that a replacement housing

payment cannot be made until the deficiencies are corrected.

4.7.12 90-Day Notices and Subsequent 30-Day Notices

No displaced person shall be required to move from his/her home, farm or business until

the displacee has received a 90 day notice to vacate, followed by a 30 day notice to vacate.

For residential occupant the displacee must also have been informed of an available

comparable replacement housing unit. All 90 day notices will be provided to the displacee

at the time when initiations of negotiations have started. The 90 day notice cannot be

sent to residential occupants until the initiation of negotiations or comparable replacement

housing has been offered, whichever is later. The 90 day notice will contain no specific

date to vacate, but will indicate that the displacee will have a second notice at a later date

providing a 30 day notice.

The 30 day notice to vacate will contain a specific date and will only be sent out after the

displacee has received a 90 day notice to vacate and at least 60 days have elapsed since

the 90 day notice was received by the displacee. A 30 day notice will only be given after

the owner has been paid or for cases involving condemnation, only after a declaration of

taking has been filed and a deposit of the fair market value to the Superior Court Trust

Fund and an appointment of Commissioners entered by the court.

The 30 day notice shall incorporate the Notice to Quit and Demand for Possession.

If a 90 day notice to vacate the premises has not been sent by the time the State has

taken ownership, then a combination 90 / 30 day letter must be sent.

4.7.13 Emergency Relocations

A waiver of the requirements regarding the availability of a comparable replacement

dwelling may be granted in any case where it is demonstrated that a person must move

because of a major disaster, or national or other emergency which requires immediate

vacation of the property. Whenever a person is required to relocate temporarily, the agent

shall take appropriate steps to ensure that the person is relocated to a decent, safe, and

sanitary dwelling; pay the actual reasonable moving expenses and any reasonable increase

in rent and utility costs incurred in connection with the temporary relocation; and make

available to the displaced person as soon as feasible, at least one comparable replacement

dwelling.

4.8 Department Actions

Department Actions (Form RE-27) shall be processed for all relocation payments, except

where the payment authority is contained in the approved owner's purchase agreement.

4.9 Replacement Housing Payments for 90-Day Occupants

4.9.1 Owner Occupant Eligibility

A displaced Owner Occupant is eligible for this payment if the person:

A. Has owned and occupied the displacement dwelling for not less than 90 days

immediately prior to the initiation of negotiations; and

B. Purchases and occupies a decent, safe, and sanitary replacement dwelling within one

year after the later of the following dates (except that the Department may extend such

one year period for good cause):

1. The date the person receives final payment for the displacement dwelling or,

2. In the case of condemnation, the date the just compensation is deposited in the

court, or

3. The date we meet our obligation to make comparable replacement housing available

to the occupant.

4.9.2 Amount of Payment

Owner replacement housing supplements are to be made on Form RE-150. The estimates

shall include at least three comparables. In properly documented circumstances, less than

three comparables may be utilized. The selected comparables must be the most nearly

comparable and equal to or better than the subject property. The listing considered to be

most comparable shall be used as the basis for determining the replacement housing

supplement payment. This listing must have been inspected by the realty specialist and

deemed as decent, safe and sanitary.

The replacement housing payment may not exceed $31,000 (unless last resort housing

provisions are invoked.) The payment is limited to the amount necessary to relocate to a

comparable replacement dwelling within one year from the date the owner is paid for the

displacement dwelling, or the date a comparable replacement dwelling is made available

to the owner, whichever is later. It should be noted that if the displacee elects to acquire

and move into a unit that costs more than the unit selected in the housing supplement,

reimbursement shall be only up to the difference between the acquisition cost of the

displacement dwelling and the cost of the comparable in the housing supplement and not

the cost of the replacement dwelling.

The reimbursement shall be calculated as the amount by which the cost of a replacement

dwelling exceeds the acquisition cost of the displacement dwelling. The owner occupant

is also to receive a payment for any increased interest/debt service costs which are

incurred in connection with the mortgage(s) on the replacement dwelling based on the

amount of debt that the owner occupant had remaining on the property being acquired

and the reasonable closing costs and expenses incidental to the purchase of the

replacement dwelling. In the case where the owner(s) occupied a portion of the acquired

property as a residence, the value of the residence will be carved out of the total acquisition

price and then that value will be used to calculate any payment differential to purchase a

comparable replacement dwelling. Should an owner occupant purchase a replacement

dwelling/home for an amount greater than the comparable replacement dwelling selected,

incidental costs would be adjusted as appropriate.

A 90-day homeowner occupant eligible for a replacement housing payment, but electing

to rent a replacement dwelling, is eligible for a rental assistance payment not to exceed

the amount of the owner housing supplement.

The amount of the rental assistance payment is based on a determination of market rent

for the acquired dwelling with the cost for utilities compared to a comparable rental

dwelling available on the market with the expected costs for utilities. The increase in

difference, if any, would be the amount of the monthly supplement, which would be for 42

months that the homeowner would be eligible for but the total amount would not be

permitted to exceed the amount that the owner could have received as a 90 day

homeowner housing supplement if the owner had elected to purchase and occupy a

comparable replacement dwelling. If it did exceed, then the owner housing supplement

would be the maximum amount that could be used for any rental difference.

If the homeowner elects to rent a unit where the rent and utilities are less than the market

rent and utilities used to calculate the possible owner rent supplement, then there would

be no supplement payment.

4.9.3 Computation of Price Differential

The price differential is the amount which must be added to the acquisition cost of the

displacement dwelling to provide a total amount equal to the lesser of: (a) the reasonable

cost of a comparable replacement dwelling or (b) the actual purchase price of the decent,

safe and sanitary replacement dwelling purchased and occupied by the displaced person.

Reimbursement is estimated based upon:

Estimated cost of replacement housing

$150,000.00

Minus acquisition cost of present dwelling

$125,000.00

Replacement housing supplement

$25,000.00

Actual Reimbursement is based on

Actual purchase price of replacement housing

(up to the approved replacement supplement amount)

$140,000.00

Minus acquisition cost of present dwelling

$125,000.00

Replacement housing supplement

$ 15,000.00

4.9.4 Determining the Cost of a Comparable Replacement Dwelling

The maximum replacement housing payment shall be based on the listing price of the

selected comparable replacement dwelling. The payment shall be computed utilizing the

comparable most nearly representative of, or better than, the replacement dwelling. To

the extent practicable, comparable replacement dwellings shall be selected from the

neighborhood in which the replacement dwelling was located or, if that is not possible, in

nearby or similar neighborhoods based on similar housing types and services where

housing costs are generally the same or higher.

The staff member who prepares the housing supplement is prohibited from being assigned

responsibility for the relocation of the relocatee for whom the supplement was prepared.

In cases where the housing supplement is for an owner or tenant who has a handicap and

there are no comparables available that can accommodate the relocatee’s handicap, then

estimates can be obtained to make the selected unit handicap accessible and included as

part of the housing supplement.

4.9.5 Offering the Replacement Housing Payment

The realty specialist, at the initiation of negotiations, shall explain how the replacement-

housing supplement was computed and when there is no entitlement, the owner shall be

informed of this fact and the rationale for the determination. At the time of the offer, the

realty specialist shall also tender to the owner the estimated replacement-housing

supplement amount for which the displacee/relocatee is eligible.

The realty specialist will inform the displaced person, in writing, of the specific comparable

replacement dwelling(s) and the price used as the basis for establishing the upper limit of

the replacement housing payment. The owner shall be notified that a replacement housing

payment may not be made unless the replacement dwelling is issued a certificate of

occupancy or certificate of continued occupancy (if required by the municipality) and

inspected and determined to be decent, safe and sanitary by the realty specialist.

In instances where the owner housing supplement payment is needed prior to a closing on

a replacement dwelling to be occupied by the owner, arrangements may be made by the

realty specialist to have the funds deposited into the owner occupants attorney escrow

account with the understanding and agreement of the owner and counsel that the funds

are not to be released unless the replacement dwelling has received a certificate of

occupancy as required by local municipal code and has been inspected by the realty

specialist and determined to be decent, safe & sanitary. It is to be further understood and

agreed that if a closing doesn’t occur, the entire amount deposited into the escrow will be

returned to the State.

4.9.6 Special Situations

A. Major Exterior Attribute - If the site of the comparable replacement dwelling lacks an

attribute of the subject site (e.g., the site is significantly smaller or does not contain a

swimming pool), the value of the attribute shall be subtracted from the acquisition cost

of the subject dwelling for purpose of computing the payment.

Example: Residential Property has a tennis court

Fair Market Value of Residential Property

$200,000

Contributory Value of Tennis Court

$10,000

Adjusted Value of Residential Property

$190,000

The $190,000 is used in calculating the owner housing supplement.

B. Partial Acquisition - If the acquisition of a portion of a residential property causes the

displacement of the owner from the dwelling and the remainder is a build able

residential lot, an offer will be made to purchase the entire property. If the owner

refuses to sell the remainder, the fair market value of the remainder may be added to

the acquisition cost of the subject dwelling for purposes of computing the replacement

housing payment.

C. Land Typical for Area - Where a dwelling is located on a tract typical for residential use,

the maximum replacement housing payment is the listing price of a comparable

dwelling on a tract typical in size, less the acquisition price of the acquired dwelling and

the tract on which it is located.

D. Land Larger than Typical for Area - Where a dwelling is located on a tract larger than

the typical residential use, the maximum replacement housing payment is the listing

price of a comparable dwelling and the tract typical in size for residential use, less the

acquisition price of the acquired dwelling; plus the acquisition price of that portion of

the tract typical in size for residential use.

E. Multiple Units - If the subject unit was part of a property that contained another dwelling

unit and/or space used for non-residential purposes, only that portion of the acquisition

payment which is actually attributable to the subject dwelling unit occupied by the

owner shall be considered its acquisition cost when computing the price differential. An

appraiser will calculate the acquisition value of the carve out portion of the owner

occupied unit of the multiple dwelling.

F. Joint Ownership - When a single family dwelling is owned by several persons and

occupied by only some of the owners, the replacement housing payment shall be the

lesser of the difference between the owner occupant's share of the acquisition cost of

the acquired dwelling and the actual cost of the replacement, or the difference between

the total acquisition cost of the acquired dwelling and the amount determined as

necessary to purchase a comparable dwelling of that portion of the acquired land which

represents a tract typical in size for residential use.

G. Highest and Best Use - If a dwelling is located on a tract and the property is appraised

on a higher and better use than residential, the maximum payment shall be the

difference between the listing price of a comparable on a typical residential tract and

the acquisition price of the acquired dwelling, plus the acquisition price of that portion

of the acquired land which represents a typical residential tract.

H. Owner Retention of Replacement Dwelling - If the owner retains ownership of the

dwelling, moves it from the subject site and occupies it on a replacement site, the

purchase price of the replacement dwelling shall be the sum of the cost of moving and

restoring the dwelling to a condition comparable to that prior to the move; the cost of

making the unit a decent, safe and sanitary replacement dwelling; the current fair

market value for residential use of the replacement site; and the retention value of the

dwelling, if the retention value is reflected in the “acquisition cost” used when

computing the replacement housing supplement.

Any exceptions in the carve-out and highest and best use applications which appear to

result in an excessive housing supplement should be discussed with and resolved by the

District Program Manager and in conjunction with the Manager of Technical Support or

designee.

4.9.7 Limitations on Payment

The amount established as the replacement housing supplement sets the upper limit of

the payment as follows:

A. If the person purchases and occupies a decent, safe and sanitary dwelling adequate for

his/her needs at a price less than that computed, the supplement will be reduced to the

amount required to pay the difference between the acquisition price of the subject

dwelling and the actual purchase price of the replacement dwelling.

B. If the person purchases and occupies a decent, safe and sanitary dwelling at a price

less than the acquisition price of the subject dwelling, no supplemental payment shall

be made.

C. The amount of any insurance proceeds received by a person in connection with a loss

to the subject dwelling shall be included in the acquisition cost of the replacement

dwelling when computing the supplemental payment. For recognized disasters, FHWA

may provide temporary rules to be considered in computing a supplement.

4.9.8 Application for Payment

Owners shall submit their application for housing payments on Form RE-152, together with

a certified copy of the closing statement for the replacement dwelling and a copy of the

certificate of occupancy (if required by the municipality). The realty specialist shall inspect

the replacement property and confirm on Form RE-162 that it is decent, safe and sanitary

and the realty specialist will sign and date the form.

Some municipalities require a Certificate of Occupancy prior to occupying a property. All

applicable documentation, specifically the housing supplement report, and a department

action shall be transmitted to the Technical Support Bureau for processing to Accounting

for payment.

4.9.9 Preparation of Housing Supplements

A supplemental housing payment may be prepared by a Realty Specialist 2 or higher titled

person who is not assigned relocation responsibility for the particular parcel. In no instance

may a person who appraised or reviewed the appraisal to establish the fair market value,

prepare the replacement supplement estimate for that property. Prior to the initiation of

negotiations, all housing supplements shall be independently reviewed and signed off by

the appropriate District Program Manager. Form RE-186 shall be utilized for the review

and shall become part of the case file. The housing supplement will not be revised unless

there is error, the appraisal is revised, the residential real estate market conditions change

measurably, or a remnant is acquired.

4.9.10 Updating of Housing Supplement

A revised housing supplement shall be prepared and updated whenever housing is no

longer available on the market within the offered amount as concluded by the realty

specialist and relocatee. Whenever changes, revisions, or updates appear warranted, they

shall be in writing and supported as in the original report. The revised supplement shall

be independently reviewed before the supplemental payment is offered. If the revised

supplement is less than that originally computed, the supplemental payment may only be

reduced if it does not prejudice actions that the owner has taken to acquire replacement

housing.

The supplemental payment is limited to the amount necessary to relocate to a comparable

replacement dwelling within one year from the date the owner is paid for the displacement

dwelling, or the date a comparable replacement dwelling is made available to the owner,

whichever is later. Any Owner Housing or Tenant Rental Supplement calculated to be over

$50,000 will be reviewed by the District Program Manager.

4.9.11 Multiple Occupancy of the Same Dwelling Unit

If two or more occupants, who have been determined to be one family, move to separate

replacement dwellings, each occupant is entitled to a pro rata share of any housing

payment that would have been made if the occupants moved together to a comparable

replacement dwelling.

If the District Program Manager determines that two or more occupants maintained

separate households within the same dwelling, the occupants have separate entitlements

to supplemental housing payments. Separate households exist when two or more

occupants can document separate rental payments to the landlord, as well as private

occupancy of a portion of the quarters, in addition to community rooms which may be

shared. If two or more eligible individuals with no identifiable head of household occupy

the same single family dwelling unit, they are to be considered as one family for

replacement housing supplemental payment purposes.

4.9.12 Administrative Settlements

Replacement housing supplements are predicated upon the acquisition price of the subject

dwelling. In an administrative settlement/award, the supplemental payment shall be

proportionately reduced or increased (without need for a new estimate) by the amount the

administrative settlement/award exceeds or is less than the acquisition cost attributed to

the dwelling and typical lot.

4.10 Mortgage Costs/Incidental Expenses

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 will allow for the same

monthly payment for principle and interest as that for the mortgage(s) on the subject

dwelling for that number of payments that was outstanding on the old mortgage.

Additional payments may include other debt service costs as deemed appropriate, if not

paid as incidental costs and shall be based only on mortgages that were valid liens on the

displacement dwelling for at least 180 days prior to the initiation of negotiations.

1. The payment shall be based on the unpaid mortgage balance(s) on the subject

dwelling. In the event the owner obtains a smaller mortgage than the mortgage

balance(s) computed in the buy down determination, the payment will be prorated

and reduced accordingly. 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

subject dwelling or the term of the mortgage on the replacement dwelling,

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: (a) they are not paid as incidental expenses; (b) they

do not exceed rates normal to similar real estate transactions in the area; (c) it is

determined they are necessary; and (d) the computation of such points and fees is

based on the unpaid mortgage balance on the subject dwelling, less the amount

determined for the reduction of such mortgage balance.

5. The displaced person shall be advised of the approximate amount of the payment

and the requirements 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. During the initial personal contact, the realty specialist

shall secure the necessary documentation from an owner occupant to compute a

preliminary mortgage interest rate differential payment, which shall be tendered

when possible to the owner concurrently with the housing supplement.

4.10.1 Application For Mortgage Interest and Incidental Expense Payment

Owner Mortgage Interest Rate and Incidental Expenses Application, Form RE-194, shall be

accompanied by a certified copy of the closing statement (unless previously submitted),

as well as the mortgage note and final payoff statement. These documents shall be

reviewed in the District Office and approved by the Realty Specialist 4. When the amounts

have been established, a Department Action will be prepared and transmitted to the

Project Funding Unit of the Technical Support Bureau, accompanied by the invoice, an

expense distribution sheet, frap (Federal Relocation Assistance Program Report) and the

completed and signed RE-194 and the copy of the closing statement for the replacement

dwelling for processing to Accounting for payment.

4.10.2 Incidental Expenses

Incidental expenses, also known as closing costs, are those reasonable costs incurred by

the displaced person in the purchase of a replacement dwelling, customarily paid by the

buyer, including:

1. Legal, closing and related costs, including title search, conveyance instruments,

surveys, notary and recording fees.

2. Lender application and appraisal fees.

3. Loan origination or assumption fees that do not represent prepaid interest.

4. Certification of structural soundness and termite inspection, when required.

5. Credit report.

6. Title insurance for mortgages can cover the amount of the loan in place at the time

of the initiation of negotiations or in the case of a home equity line of credit the

amount outstanding on the home equity line of credit 180 days before the initiations

of negotiation. Title Insurance will also be covered for the value of the property for

the owner’s benefit.

7. Escrow agent's fee.

8. State revenue or documentary stamps, sales or transfer taxes, not to exceed the

costs for a comparable replacement dwelling.

9. Home inspection report.

10.And other costs determined by the District Program Manager to be incidental to the

purchase.

If an owner occupant displacee purchases a replacement property costing more than the

comparable replacement offered, any additional costs associated with and incurred for the

more expensive dwelling above the cost of the comparable replacement offered are not

eligible for reimbursement. If there is no eligibility for a differential, then the acquisition

price of the owner occupied portion of the acquisition property sets the limit for the amount

of incidental expenses that can be reimbursed.

4.11 Replacement Housing Payments For Less Than 90-Day Occupants

A displaced tenant or owner occupant may be entitled to a payment not to exceed $7,200

for rental or down payment assistance before going to housing of last resort, if the person:

1. Actually and lawfully occupied the subject dwelling for one to 89 days immediately

prior to the initiation of negotiations.

2. Rents or purchases and occupies a decent, safe and sanitary replacement dwelling

within 1 year after the date the owner/tenant moves from the subject dwelling, the

date the owner receives final payment for the subject dwelling, or the date of the

court deposit, whichever is later.

3. No person to be displaced shall be required to move from his/her dwelling unless at

least one comparable replacement dwelling has been made available. Less than 90

day occupants (persons occupying between the date of the initiation of negotiations

(offer) and up to 89 days before are entitled to all relocation services.

4.11.1 Rental Assistance Payment

An eligible displaced person that rents a replacement dwelling is entitled to a payment not

to exceed $7,200 for rental assistance except as required under the last resort housing

provisions. The tenant rent supplement payment shall be 42 times the amount obtained

by subtracting the base monthly rental and utilities cost for the subject dwelling from the

monthly rent and anticipated cost of utilities for a comparable replacement dwelling

selected as most comparable to the subject and having the required number of bedrooms

and being similar in number of rooms and square footage to subject.

Utility costs must be considered and factored into every tenant rental supplement

computation. If necessary, a portion of the 42 month supplement can be used for the

security deposit of the replacement dwelling.

4.11.2 Base Monthly Rental for Subject Dwelling

The base monthly rental for the subject dwelling is the lesser of:

A. The average monthly cost for rent and utilities at the subject for a three month period

prior to displacement. For an owner occupant, the fair market rent for the subject will

be utilized. For a tenant who paid little or no rent for the subject dwelling, the fair

market rent will be used, unless its use would result in a hardship because of the

person's income or other circumstances). For instances where the tenant doesn’t pay

rent for the rental unit, but instead performs services, such as those of a super for an

apartment complex, in lieu of paying a rent or in exchange for paying little rent, the

market rent value of that rental unit will be considered as the monthly rental and that

value will be added to the income that the household declares; or

B. Thirty (30) percent of the person's average gross household income when that amount

is below the income threshold set by the U.S. Department of Housing and Urban

Development's Public Housing and Section 8 Program Income Limits. This information

is provided on FHWA's Web site

(http://www.fhwa.dot.gov/real_estate/uniform_act/relocation/exclusions.cfm) and is

updated annually. If the person refuses to provide appropriate evidence of income or

100

is a dependent, the base monthly rental shall be established solely on item (a) above.

When a household income fluctuates, whether it because of seasonal type of work

performed or as a result of a commission based income or for some other justified

reason, the total household’s income for the last twelve months will be averaged to give

a monthly amount. For any household eligible for consideration of the 30% income

threshold as the base for their monthly rental, the relocatee must provide the realty

specialist with a signed and notarized affidavit of their income, as well as proof of the

income. Pay stubs for at least the last four weeks, a copy of the Federal and State

income taxes and W-2’s that were filed for the previous year will be considered sufficient

documentation. If there is a large discrepancy downward between the gross household

income from the previous year and the projected income for the current year as

calculated by multiplying by 12 (or 6, depending on the length of the pay period

covered, i.e., 1 week or 2 weeks) the total of the last four pay stubs for the household,

the realty specialist is required to have the relocatee explain and provide as necessary

justification for the discrepancy.

C. A full time student or resident of an institution may be assumed to be a dependent,

unless demonstrated otherwise, and their income is excluded from the household

income computation; or

D. The total of the amounts designated for shelter and utilities, if the occupant is receiving

a welfare assistance payment from a program that designates the amounts for shelter

and utilities.

4.12 Manner of Disbursement And Documentation Required

All rental assistance payments in excess of $25,000.00 shall be disbursed in installments

unless the District Program Manager or the Technical Support Manager determines that a

payment in excess of $25,000 is warranted and approves the lump sum payment of the

rental assistance, also known as the tenant rent supplement payment. The full amount

of the Tenant Rent Supplement vests immediately, whether or not there is any later change

in the household’s income or rent, or in the condition or location of the person's housing.

Tenant Rent Supplement Payments that are paid out in installments are to be used for the

displacee’s rental and the realty specialist is advised to make an effort to see that the

displacee rental assistance installment payment is applied to the rental and security

deposit, if necessary. The realty specialist may also have the displacee endorse the rental

installment payment over to the landlord for prepaying of the rental obligations for the

replacement rental, provided that the bank agrees to do so.

In either event the realty specialist is required to have the landlord provide a receipt for

the advance rental payment to the displacee, with a copy to the realty specialist. The

realty specialist will also draft a receipt letter that both the displacee and the landlord will

sign, and be witnessed by the realty specialist. This receipt letter will stipulate and that

the payment is to be applied to the displacee’s monthly rental obligation for the rental year

with the beginning and ending dates of the rental period noted and the total amount of the

monthly rental with that portion of rental that the displacee is required to pay each month

noted. The receipt letter will also identify who is responsible for what utilities and that if

there is a security deposit, it will be deposited into an interest bearing security account for

the displacee in accordance with state law. The receipt letter will also state that if the

displacee vacates before the end of the lease, the balance of the rental payment for the

remaining term will be returned to the State. This amount can then be used by the

displacee for the rental of another rental unit that is decent, safe & sanitary.

101

Before any Tenant Rent Supplement Payment is made to a displacee, the displacee is

required to provide a copy of the signed lease for the replacement rental to the realty

specialist, which will be kept on file at the District with a copy sent to the Project Funding

Unit of the Bureau of the Technical Support. Additionally a copy of the decent, safe &

sanitary inspection sheet for the replacement rental unit, a copy of the tenant rent housing

supplement report and invoice for payment of the supplement and related documentation

will be submitted with the signed lease.

4.13 Down Payment Assistance Payment

An eligible tenant occupant who purchases a dwelling is entitled to a down payment

assistance payment up to $7,200 or a higher amount if the tenant rent supplement is

based on housing of last resort. 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 eligible incidental expenses.

A tenant displacee who elects to use the Tenant Rent Supplement as a down payment for

the purchase of a decent, safe and sanitary residential dwelling must demonstrate that the

payment of the mortgage, along with taxes, insurance, utilities and other fees and or

expenses associated with owning a residential dwelling will not result in an undue hardship

on the tenant and that the tenant can afford to pay the aforementioned. The District will

be responsible for obtaining documentation from the tenant that will demonstrate that the

tenant displacee can afford to make the payments associated with buying and maintaining

a residential dwelling without undue hardships. This documentation will be submitted to

the Project Funding Unit of the Bureau of the Technical Support along with the TRS report,

contract of sale, D.S. & S. inspection sheet for the property to be purchased, Department

Action, Invoice, expense distribution form, frap and W-9.

4.14 Offer of Replacement Housing Supplement

A written confirmation of the tender of the rental supplement to the occupant shall be

accomplished on Form RE-176. The confirmation shall contain:

 The date of the initiation of negotiations with the owner

 The amount of the replacement housing payment

 An explanation of the requirements to receive a housing payment

 Of the tenant's option to purchase replacement housing and to receive a down

payment assistance payment and incidental expenses

 A presentation of the listings utilized in the preparation of the supplement.

The tenant shall be notified that a replacement housing payment may not be made unless

the replacement dwelling, whether for rental or purchase, is subsequently inspected by the

realty specialist and determined to be decent, safe and sanitary, and where required by

local municipality, a Certificate of Occupancy has been issued.

4.15 Replacement Housing For Subsequent Occupants

Those who move in subsequent to the initiation of negotiations, but prior to the acquisition

of the property, are subsequent occupants who are considered to be displaced persons

that are eligible for moving costs and relocation services consisting of assistance in locating

a replacement residential opportunity. Should the subsequent occupant reside in the

property until such time as the State takes ownership of the property, the displacee may

102

be eligible for a Tenant Housing Supplement. A determination will be made by the

Manager of the Bureau of Technical Support or designee.

The incidence of subsequent occupants can be controlled through a protective leasing

procedure that is described in Sections 4.210.4 and 4.210.16. Under this procedure rental

units may be rented and kept vacant by the department while negotiations with the owner

are ongoing.

Comparable replacement tenant rental housing is considered to be within the person’s

financial means if the Department 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 49 CFR§24.402(b)(2). This procedure specifies a rent to rent

calculation if the displacee does not qualify as low income.

Comparable housing is considered to be within the occupant’s financial means if the

monthly rental and utility costs do not exceed 30% of the occupant’s gross monthly

household income when that amount is considered as low income per the U.S. Department

of Housing and Urban Development's Public Housing and Section 8 Program Income Limits,

or if receiving a welfare assistance payment, the total of the amounts designated for shelter

and utilities. If such housing is available, no rental assistance payment is due the occupant.

However, if comparable housing is not available within 30% of the occupant’s gross

monthly household income when that amount is considered as low income per the U.S.

Department of Housing and Urban Development's Public Housing and Section 8 Program

Income Limits (or the designated welfare assistance amounts), a rental assistance

payment must be computed and offered to the occupant under last resort housing

provisions.

4.16 General Requirements: Housing Supplements

If any eligible occupants have not submitted an application for a supplement upon their

vacating of the premises, they shall be notified, by certified and regular mail, that to

receive the supplemental payment, they must occupy a decent, safe and sanitary dwelling

unit within one year from the date they vacated the acquired property in order to maintain

their eligibility for payment. The letter must clearly specify the final date that they can file

a claim.

4.16.1 Purchase of Replacement Dwelling

A displaced person is considered to have met the requirement to purchase a replacement

dwelling, if the person:

 purchases a dwelling;

 purchases and rehabilitates a substandard dwelling;

 constructs a dwelling on a site that he or she owns or purchases;

 contracts with a builder for the purchase or construction of a dwelling on a site that

the person owns or purchases; or

 currently owns a previously purchased dwelling and site, the valuation of which shall

be on the basis of current fair market value and the displacee intends to relocate to

and occupy the dwelling.

All replacement dwellings must be verified as decent, safe and sanitary by the realty

specialist.

103

4.16.2 Occupancy Requirements

No person shall be denied eligibility for a replacement housing payment solely because the

person is unable to meet the occupancy requirements for a reason beyond his or her

control, including: 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

Department; or any other reason, such as a delay in the construction of the replacement

dwelling, military reserve duty, or hospital stay.

4.16.3 Conversion of Payment

A displaced person who initially rents a replacement dwelling and receives a rental

assistance payment as part of an installment of the supplement is eligible to use the

balance of the tenant rent supplement, that portion that has not yet been paid, as a down

payment for a purchase of a decent, safe and sanitary dwelling, if the displacee meets the

eligibility criteria for such payments, including purchase and occupancy.

4.17 Payment After Death

A replacement housing payment is personal to the displaced person and upon death, any

undisbursed payments shall not be paid to the heirs, except that;

1. The amount attributable to the person's period of occupancy of the replacement

housing shall be paid;

2. The full payment shall be disbursed in any case in which a member of a displaced

family dies and the other family member(s) continue to occupy the replacement

dwelling;

3. And any portion of a housing payment necessary to satisfy the legal obligation of an

estate shall be disbursed to the estate.

4.18 Claims for Relocation Payments

A claim for a relocation payment shall be supported by reasonable documentation and shall

include a Department Action detailing the payee, the amount and what the payment is for,

an invoice with attached expense distribution sheet, a FRAP, a W-9 if not already on file

and a cover memorandum and the appropriate claim for payment forms.

For a housing supplement payment, the housing supplement report, a copy of the decent,

safe & sanitary report of the replacement property, the lease or the contract of sale, shall

be submitted when requesting the housing payment.

For a moving cost payment that is not a room count payment, a copy of the paid mover’s

bill is required. If not a direct payment to a mover, a copy of the move estimate and the

moving cost authorization letter, and the completed RE-92 form is to be submitted when

requesting a moving payment. For payments made directly to the mover, a copy of the bill

for the move, a copy of the estimate, the moving cost authorization letter and an affidavit

from the mover acknowledging the move, and the completed RE-92 form shall be

submitted.

A displaced person must be provided assistance in completing and filing the claim for

payment. The claimant shall be promptly notified as to any additional documentation that

may be required to support the claim. Payment for a claim shall be made as soon as

practicable following receipt of sufficient documentation to support the claim. If a person

requires an advance relocation payment in order to avoid or reduce a hardship, the

payment shall be issued, subject to reasonable safeguards.

104

4.18.1 Time for Filing Relocation Claims

All relocatees must submit to the Departments representative a relocation claim for

payment within 18 months from the date that they vacated the property being acquired

by the Department, except for owner occupied dwellings.

Owner occupied relocatees must submit to the Departments representative a relocation

claim for payment within 18 months from when they vacate the property being acquired

by the Department or 18 months from the time that they receive payment for the property,

which ever date is later. Payment for the acquisition of the property is considered as either

the deposit made with the declaration of taking, as with a condemnation case or with the

payment made with a closing based on an agreement.

Failure to submit the claim in the time allotted will result in the relocatee forfeiting the

right to file a relocation claim.

It is the responsibility of the realty specialist to notify all relocatees of the claim submission

requirements and time frames prior to the relocatee vacating the property that the

Department is acquiring. Failure of the realty specialist to notify the relocatee of the time

limit for submitting a relocation claim will result in the relocatee having grounds to appeal

the time limit for submitting relocation claims. The Department may have to extend the

time that the relocatee has to submit a relocation claim.

This time period may be waived for good cause as determined and documented by the

District Program Manager.

4.18.2 Deductions from Relocation Payments

Advance relocation payments, which can only be made with the approval of the District

Program Manager, shall be deducted from the payment(s) to which a displaced person is

entitled. A relocation payment to a displaced person shall not be withheld to satisfy an

obligation to any creditor.

4.18.3 Notice of Denial of Claim

If all or part of a payment is disapproved because of late filing or other grounds, the

claimant shall be promptly notified, in writing, of the determination, its basis and the

procedures for appealing that determination.

4.19 Residential Moving Payments

Any occupant of a dwelling, who qualifies as a displaced person, is entitled to payment of

actual moving and related expenses, as the District Program Manager determines to be

reasonable and necessary, including expenses for:

1. Transportation of the person and personal property within a 50-mile limit. Payments

for a distance beyond 50 miles are not eligible, unless the District Program Manager

determines and documents that relocation beyond 50 miles is justified

2. Packing, crating, unpacking, and uncrating of the personal property; disconnecting,

dismantling, removing, reassembling and reinstalling household appliances and

other personal property

3. Storage of the personal property for a period not to exceed 12 months (unless the

District Program Manager determines that a longer period is necessary) and

insurance for the replacement value of the property in connection with the move

and necessary storage. Storage of personal property is not an automatic

entitlement. The District Program Manager must determine that storage is a

105

reasonable and necessary expense for a displaced person. This determination will

be based on the needs of the Department and the displaced person, the nature of

the move, the plans for permanent relocation, and the amount of time available for

the relocation process and whether storage will facilitate the relocation. The District

Program Manager will establish the terms for storage, including prohibiting the

storage site’s use as a temporary business and the length of the storage period.

4. Insurance for the replacement value of the property in connection with the move

and necessary storage. 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. Other moving-related expenses that are not

listed as ineligible in this manual and which the Department considers reasonable

and necessary.

4.19.1 Residential Room Count Moving Payments

Any person displaced from a dwelling or seasonal residence is entitled to receive a moving

payment based upon a residential room count schedule maintained by the Department

which is approved by the Federal Highway Administration. This payment shall be

determined according to the Fixed Residential Moving Cost Schedule approved by the

Federal Highway Administration and published in the Federal Register on a periodic basis.

When individuals or families elect to use this option, the following conditions shall apply:

1. Counted rooms shall be space occupied and containing a normal quantity of

household furniture; including basements, recreation and living rooms, libraries,

kitchens, laundry rooms (when containing items such as washers and dryers),

enclosed sun porches (if containing furniture), attics, greenhouses, garages and

permanent sheds (when containing household or garden equipment), foyers and

alcoves (when containing furniture).

2. Combination living/dining rooms and kitchen/dinettes shall be counted as one room.

Vestibules, bath and powder rooms shall not be considered rooms except in unusual

circumstances as approved by the District Program Manager.

A displace may elect to take a combination of a room count and actual move.

Example: Displacee has a grand piano and elects to have a professional move the piano,

but elects to move the rest of the household through room count.

4.19.2 Actual Moving and Related Expenses

Any residential occupant, not electing to utilize the room count schedule, may be

reimbursed for actual moving expenses by commercial mover, supported by receipted bill

from the commercial mover. Alternatively, direct payment may be made to the commercial

mover, upon request by the occupant. This is a State policy, which is above and beyond

that of the Federal Regulations.

4.19.3 Multiple Family Provisions

Two or more families occupying the same dwelling unit are each eligible to be reimbursed

using actual costs or the fixed payment schedule. A fixed payment will be based on the

number of rooms actually occupied by each family, plus community rooms utilized by each.

Two or more individuals, not a family, who occupy the same dwelling unit, are considered

to be a single family.

106

4.19.4 Costs of Transportation

The costs of transportation of occupants to the new location are also eligible. Such costs

may be on a mileage basis, not to exceed the current Internal Revenue Service allowance

for mileage (or actual cost if commercial transportation is used) and may include necessary

special transportation services. The actual, reasonable costs of meals and lodging, when it

is determined that such costs are required because of unforeseen circumstances or the

practical necessities of moving, are also eligible. Transportation costs are available only to

those occupants who elect to move on the actual cost basis.

4.19.5 Moves of Personal Property Only (Dwelling Not Displaced)

Moving expenses are reimbursable for an eligible person who is required to move personal

property from real property but is not required to move from a dwelling (including a mobile

home), as set out in the Section 4.12 introduction of the manual, if applicable.

Examples of personal property only moves might be: personal property that is located on

a portion of property that is being acquired, but the residence will not be taken and can

still be utilized after the acquisition; personal property that is located in a mini-storage

facility that will be acquired or relocated; personal property that is stored on vacant land

that is to be acquired. If a question arises concerning the reasonableness of an actual cost

move, the acquiring District Office may obtain estimates from qualified movers to use as

the standard in determining the payment.

Those items listed in A through E in the introductory portion of Section 4.13 are eligible

for reimbursement under this type of move.

4.20 Commercial, Farm & Non Profit Relocation

4.20.1 Overview

Upon assignment of a project, a personal interview will be conducted with the occupants

of any property which will require relocation and a site survey prepared. A site survey for

a property not requiring relocation services will be marked as “No Relocation Required”

and placed into the file. The data gathered during the survey will enable the realty

specialist to measure the replacement needs against available housing resources and to

develop a personalized relocation plan specifically tailored to the needs, circumstances and

preferences of the displaced family or business. The interview will include determining

eligibility for relocation in accordance with 4.5.5 Status of a Displacee in the United States.

The data generated from the Site Surveys must include in the cases of “Business, Non-

Profit, Governmental Agencies or Farms” the Site Survey’s include - the nature of

operation; income as reported for Federal tax purposes, if applicable; number of

employees; length in present quarters; geographic relation to market and suppliers; nature

of ownership, as applicable.

Additionally, for nonresidential relocation (primarily businesses), the personal interview

requirement as part of the Site Survey includes, at a minimum, six specified items as

follows:

1. The business's replacement site requirements, current lease terms and other

contractual obligations and the financial capacity of the business to accomplish the

move.

2. Determination of the need for outside specialists in accordance with 49 CFR Part

24.301(g)(12) 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.

107

3. For businesses, an identification and resolution of personalty/realty issues. (Every

effort must be made to identify and resolve realty/personalty issues prior to, or at

the time of, the appraisal of the property. This will tie back to the appraisal

requirement for this determination in the appraisal. The appraisal requirements are

in Subpart B, § 24.103(a) (2) (i) and Appendix A. The appraiser is to identify

realty/personalty items and coordinate with the agent responsible for relocation as

appropriate in doing so).

4. An estimate of the time required for the business to vacate the site.

5. An estimate of the anticipated difficulty in locating a replacement property.

6. An identification of any advance relocation payments required for the move, and the

Department’s legal capacity to provide them.

4.20.2 Commercial Moving Payments

Any business or farm operation, which qualifies under the definition of a displaced person,

is entitled to payment for such actual moving and related expenses as the District Program

Manager determines to be reasonable and necessary, including expenses for:

A. Transportation of Personal Property - Transportation costs for a distance beyond 50

miles is not eligible, unless the District Program Manager determines that further

mileage is justified. If a move is in excess of 50 miles, bills must have the costs

separately itemized and set forth the amount of extra costs attributable to travel the

distance in excess of 50 miles.

B. Packing, crating, unpacking, and uncrating of the personal property. Disconnecting,

dismantling, removing, reassembling and reinstalling machinery, equipment and other

personal property (including substitute personal property) and connection to utilities.

Modifications to personal property necessary to adapt it to the replacement structure,

site, or the utilities at the replacement site; as well as modifications necessary to adapt

the utilities at the replacement site to the personal property. Expenses for providing

utilities from the right of way to the building or improvement are excluded.

C. Storage of the personal property for a period not to exceed 12 months, unless the

District Program Manager determines that a longer period is necessary. See discussion

of storage in Section 4.12.

D. Insurance for the replacement value of the personal property in connection with the

move and necessary storage.

E. Replacement value of property lost, stolen, or damaged in the process of moving (not

through the fault or negligence of the displaced person, agent, or employee) where

insurance covering loss, theft, or damage is not reasonably available.

F. Any license, permit, or certification required of the displaced person at the replacement

location. However, the payment may be based on the remaining useful life of the

existing license, permit or certification.

G. Professional services necessary for planning the move of the personal property; moving

of the personal property; and installation of the personal property at the replacement

location. There is no monetary cap on actual moving cost reimbursements, as long as

those moving costs are necessary, accurate and reasonable. The Department may elect

to provide substitute personal property rather than move items where that decision is

economically supported.

108

H. The reasonable cost incurred in attempting to sell an item that is not to be relocated.

I. Re-lettering signs and replacing stationery (in stock at the time of displacement or cost

for minimum order amount) that is made obsolete as a result of the move.

J. Actual direct loss of tangible personal property incurred as a result of moving or

discontinuing the operation. The payment shall consist of the lesser of: (a) the fair

market value of the item as is for continued use at the acquired site, less the proceeds

from its sale. To be eligible for payment, the claimant must make a good faith effort to

sell the personal property, unless the District Program Manager determines otherwise).

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 price),

or (b) the estimated cost of moving the item, as is, but not including any allowance for

storage; or for reconnecting a piece of equipment if the equipment is in storage or not

being used at the acquired site.

K. Purchase of Substitute Personal Property - If an item of personal property which is used

as part of a business or farm operation is not moved, but is replaced with an item that

performs a comparable function, the business/farm is entitled to payment of the lesser

of: (a) the cost of the substitute item, including installation costs, minus any proceeds

from the sale of the item; or (b) the estimated cost of moving and reinstalling the item,

with no allowance for storage.

L. Searching for a Replacement Location - A displaced business or farm operation is

entitled to reimbursement for actual expenses (not to exceed $2,500) as the District

Program Manager determines to be reasonable, which are incurred in searching for a

replacement location. These expenses include transportation, meals and lodging away

from home, time spent searching and fees paid to a real estate agent to locate a

replacement site, exclusive of any fees or commissions related to the purchase of such

site. With the exception of time spent in searching, any other expenses must be

supported by receipted bills. Payment for time actually spent in the search shall be

based on the hourly rate for the person(s) conducting the search. A written statement

of the time spent in the search shall accompany the claim.

Additional eligible activities in for searching for a replacement location could include the

investigation of replacement sites by the owner, or the time of the owner’s or owner

representative’s to attend hearings and apply for permits and negotiate purchase/lease

of replacement property.

M. Other moving expenses such as the move of low value/high bulk Personal Property -

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

Department, the allowable moving cost payment shall not exceed the lesser of:

1. The amount which would be received if the property were sold at the site or

2. The replacement cost of a comparable quantity delivered to the new business

location.

Examples of personal property covered by this provision include, but are not limited to,

stockpiled sand, gravel, minerals, metals and other similar items of personal property

as determined by the Department. If the Department elects not to use this provision,

the displacee will be required to remove the material.

N. Moves of Personal Property Only (Business not Displaced) – Moving expenses are

reimbursable for an eligible person who is required to move personal property from real

109

property, but is not required to move from a business, farm or nonprofit organization

include those expenses described in items A through E and item O in this Section.

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 will not be taken and

can still operate after the acquisition; personal property that is located in a mini-

storage facility that will be acquired or relocated; personal property that is stored on

vacant land that is to be acquired. 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 Department may obtain estimates from

qualified movers to use as the standard in determining the payment.

O. Other moving expenses, which are not listed as ineligible, as the District Program

Manager determines to be reasonable and necessary.

P. Additional Eligible Moving Expenses

In addition to the moving expenses listed in 4.13 a displace is entitled to expenses for

the following if the Agency determines that they are actual, reasonable and necessary.

1. Connection to available nearby utilities from the right-of-way to improvements at

the replacement site.

2. 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, feasibility and marketing studies (excluding any fees

or commissions directly related to the purchase or lease of such site). At the

discretion of the Department a reasonable pre-approved hourly rate may be

established. Reasonable hourly rates established should compare with the rates of

other similar professional providers in the area.

3. Impact fees or one time assessments for anticipated heavy utility usage, as

determined necessary by the Department.

4.20.3 Ineligible Business Moving and Related Expenses

 The cost of moving any structure or real property in which the displaced person

reserved ownership.

 Interest on a loan to cover moving expenses;

 Loss of goodwill or profits.

 Loss of trained employees; or any additional operating expenses of a business or

farm operation incurred because of operating in the new location.

 Personal injury;

 Any legal fee or other cost for preparing a claim for a relocation payment or for

representing the claimant before the Department.

 Physical changes to the real property at the replacement location of a business or

farm operation, except those changes permitted under reestablishment expenses.

 Costs for storage of personal property on real property already owned or leased by

the displaced person.

 Reimbursement for a refundable security and or utility deposit.

110

4.20.4 Notification and Inspection

The displaced business, farm, or non-profit organization:

1. Shall be informed, in writing, of the moving cost reimbursement requirements as

soon as possible after the initiation of negotiations. This information may be

included in the relocation brochure provided to the occupant.

2. Must provide reasonable advance notice of the approximate date of the start of the

move or disposition of the personal property, as well as a list of the items to be

moved. The District Program Manager may waive this notice requirement.

3. Must permit reasonable and timely inspections of the personal property at both the

subject and replacement sites in order to properly monitor the move.

4.20.5 Fixed Payment-Commercial Occupants

A. A displaced business is eligible to choose a fixed payment in lieu of the payments for

actual moving and related expenses and reestablishment expenses. The fixed payment

shall equal the average annual net earnings of the business, but may not be less than

$2,500 or more than $40,000. The displaced business is eligible for the payment if the

District Program Manager determines that the business:

1. Owns or rents personal property which must be moved and for which an expense

would be incurred in such move; and the business relocates from the acquired

property.

2. Cannot be relocated without a substantial loss of its existing patronage (clientele or

net earnings). Increased costs related to taxes, rent or other operating expenses

can be considered in the determination of loss of patronage. A business is assumed

to meet this test unless the District Program Manager determines that it will not

suffer a substantial loss of its existing patronage

3. Is not part of a commercial enterprise having more than three other locations which

are not being acquired and which are under the same ownership and engaged in the

same or similar business activities

4. Is not operated at the displacement site solely for the purpose of renting the site to

others

B. Determining the Number of Businesses

In determining whether two or more displaced entities constitute a single business and

thus entitled to only one fixed payment, consideration shall be given to the extent to

which: the same premises/equipment are shared; substantially identical or interrelated

business functions are carried out and business and financial affairs are commingled;

the entities are held out to the public/customers as one business; the same person or

closely related persons own, control, or manage the entities.

4.20.6 Farms-Fixed Payment

A displaced farm may choose a fixed payment, in lieu of the payments for actual moving

(and related expenses) and reestablishment expenses, in an amount equal to the average

annual net earnings (but not less than $2,500 nor more than $40,000). In a partial

acquisition of land which was a farm before the acquisition, the fixed payment shall be

made only if the District Program Manager determines that the acquisition of part of the

land caused the operator to be displaced from the farm operation on the remaining land,

or the partial acquisition caused a substantial change in the nature of the farm operation.

111

Note that acquisitions on a farm may also trigger a Standing Crop payment as provided

elsewhere in this manual.

4.20.7 Non Profit Organizations-Fixed Payment

A displaced nonprofit organization may choose a fixed payment (not less than $2,500 nor

more than $40,000) in lieu of the payments for actual moving and related expenses and

reestablishment expenses, if the District Program Manager determines that it cannot be

relocated without a substantial loss of existing patronage. The organization is assumed to

meet this test, unless the District Program Manager demonstrates otherwise. Any payment

in excess of $2,500 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.

Gross revenues may include membership fees, class fees, cash donations, tithes, and

receipts from sales or other forms of fund collections that enables the non-profit

organization to operate. Administrative expenses are those for administrative support such

as rent, utilities, and salaries, advertising and other like items as well as fund- raising

expenses. Operating expenses for carrying out the purposes of the non-profit 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.

4.20.8 Average Annual Net Earnings - Business or Farm

The average annual net earnings of a business or farm 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 years prior to displacement, net earnings shall be based on the actual period

of operation at the replacement site during the 2 taxable years prior to displacement,

projected to an annual rate.

The average annual earnings must contribute materially to the business. A business

having the following types of income or earnings during the 2 taxable years prior to the

taxable year in which displacement occurs, or during such other period as the District

Program Manager determines to be more equitable will be considered to meet this

requirement.

 Average annual gross receipts of at least $5,000: or

 Average annual net earnings of at least $1,000: or

 Contributed at least 33 1/3 percent of the owner’s or operator’s average annual

gross income from all sources.

If the application of the above criteria creates an inequity or hardship in any given cases,

the Agency may approve the use of other criteria as determined appropriate.

Average annual net earnings may be based upon a different period of time when the

District Program Manager determines it to be more equitable. Net earnings include any

compensation obtained from the business or farm operation by the owner, spouse and

dependents. The person shall furnish proof of net earnings via income tax returns, certified

financial statements, or other reasonable evidence that the District Program Manager

determines is satisfactory. The District Program Manager will compute the entitlement.

112

4.20.9 Processing Applications for In-Lieu Payment

The displaced business, farm or non-profit organization shall make application for the fixed

payment by submitting Form RE-180. The District Program Manager may approve or reject

the application, completing Form RE-180, after reviewing the income tax returns or other

documentation submitted. The applicant will be notified of the amount to which he/she is

entitled and provided with an invoice. Upon return of the signed invoice a Department

Action will be processed to the Project Funding Unit of the Bureau of Technical Support

Bureau and then to Accounting for payment. The completed and signed RE-180, invoice,

expense distribution form, frap, W-9 if not already on file along with Department action

will also need to be submitted.

4.20.10 Competitive Moving Estimates (Commercial Moves)

The realty specialist shall secure three moving cost estimates from licensed commercial

movers, which shall serve as the basis for a pre-move determination of the estimated

moving cost payment due the occupant. The moving cost estimates should be for a move

to a specific site, which may be a storage site. The occupant may elect to secure his/her

own estimate(s) of the cost of relocation. The realty specialist will still be required to obtain

at least one independent estimate if the displacee has obtained the other two estimates.

The realty specialist will send a Moving Cost Authorization letter to the displacee after the

three estimates have been obtained and the letter will authorize the lower of the three

estimates to move the personal property. All Moving Cost Authorization letters must be

signed by the Realty Specialist 4.

Actual, reasonable costs incurred in the move, supported by receipted bills or other

evidence shall be reimbursed to the occupant up to the amount approved in the moving

cost authorized letter that was sent to the displacee. Any amount above this will require

justification and approval of the District Program Manager and will be forwarded to the

Project Funding Unit of the Technical Support Bureau with the request for payment.

Alternatively, the occupant may present the bill for direct payment by the Department to

the moving company.

Before approval of a moving cost estimate, the realty Specialist shall make an on-site

inspection of the personalty to be moved. For complex business relocations, specifications

shall be developed and additional estimates may be secured.

The realty specialist shall accompany those individuals providing the moving cost estimates

to ensure that each estimator is provided the same information. Each estimator shall be

provided a copy of the inventory and the specifics of the move. All moving estimates

obtained shall be reviewed by the realty specialist and their Supervisor. The goal is to

compare one estimate against the other in order to verify the accuracy of the estimates;

to determine which is most reasonable; and to determine if the prices quoted are

reasonable for the service to be provided. The realty specialist shall request a breakdown

of cartage, labor, equipment and material to assist in recognizing differences between

estimates. The realty specialist shall provide the occupant/displacee/relocatee with copies

of the estimates and the Department’s analysis of the estimates. The relocatee must be

advised that this is an estimate only and that reimbursement will be made on the basis of

the actual, reasonable and necessary costs incurred.

4.20.11 Estimate Format

Moving estimates shall contain sufficient information to clearly specify the quantity of

personalty, the origin and destination of the move, as well as the company performing the

113

move. Sufficient information must be presented to permit the realty specialist to properly

analyze the move and to audit the costs submitted to be certain they are competitive.

All moving and/or reinstallation estimates shall include at a minimum: the nomenclature

and description of goods to be moved and/or to be reinstalled; applicable pricing factors

by unit, weight, and/or hourly rate for cartage, labor, equipment and materials.

4.20.12 Inventory of Personal Property

Affidavit and Certification Form RE-190 must accompany all moving estimates and the

estimates should indicate that an inventory was provided including any specific instructions

regarding the move. Inventories typically fluctuate from the date of the estimate to the

date of the actual move and pre-move and post-move inspections are required.

The realty specialist shall prepare the inventory in company with the relocatee, however,

an on-site review of an inventory prepared by the relocatee will be acceptable. In either

case, identify any unusual item by estimated weight, size and/or quantity or volume. If an

inventory is extensive or items are spread over several floors or buildings, the inventory

is to note the location of the items. This will be helpful to the mover, since it is more costly

to move items from upper floors as compared with a ground level access.

During the earlier interview with the business owner or the inventory phase, the occupant

may discuss a preference of moving options (i.e. standard move, self-move or some

combination) and this is an ideal time to discuss the pros and cons of the various

alternatives. The realty specialist responsible for securing the inventory must consult the

appraisal report to ensure that items included in the real estate valuation are not included

in the inventory of items to be moved. The appraisal report now contains a separate section

dealing with the identification of realty/personalty items. This may have already been

coordinated earlier by the appraiser and the realty specialist prior to the appraisal phase

of the project.

An inventory for an industrial property will typically include machinery and equipment, not

considered realty, which are used in manufacturing. During the inventory, options can be

developed for moving the equipment and a determination made as to what is involved in

servicing or re-installing the unit. This is also the time to identify items that will be

abandoned, for which a substitute will be purchased, or that may cost more to move than

their worth.

A copy of the inventory shall be provided to and acknowledged by the Movers providing an

estimate. The inventory will serve as the basis for the competitive estimates and should

assist in maintaining consistency between the estimates. The realty specialist is expected

to accompany the mover(s) on the site inspection to observe the personalty to be moved.

Prior to the move, the inventory shall be re-verified to determine items that may have

already been relocated, sold or scrapped. Any significant changes from the pre-move

inventory are to be addressed to assess any impact on cost. In situations where an

inventory may change daily, it may be necessary to obtain estimates based upon a

"typical" inventory, and then adjust the payment based on the inventory actually moved.

4.20.13 Tips on Performing an Inventory

Draw a floor layout and take photographs of all major items or groups of items. Ask

questions about unfamiliar items or the intentions of the operator. Take a physical count

of the inventory and use specific units of measurement to describe items or to express

quantities, e.g., 6-8' metal shelves. Note special circumstances such as machine

anchoring, delicate glass display racks and machines requiring special balancing or

114

calibration. Do not feel compelled to define specific relocation methods or to solve

relocation problems while taking the inventory, this is the task when writing the

specifications.

Note items that are questionable as to personal or real property and resolve these

questions before estimates are secured. Ask the operator to certify to the correctness of

the inventory as of the date it is performed. The realty specialist should flag items which

are potential candidates for a direct loss of tangible personal property or substitute

property claim and discuss this possibility with the business operator before including on

the inventory for the mover estimate. The realty specialist shall perform a final inventory

just before the move takes place. There shall be prior agreement to adjust the

reimbursement to reflect significant additions or reductions in inventory.

4.20.14 Monitoring the Move

All moving expenses must be actual, reasonable and necessary. The realty specialist shall

accomplish inspections and provide surveillance commensurate with the complexity of the

move. All moves require the realty specialist to perform a pre-move inspection (within 5

days prior to the move) to ensure that items included in the original inventory have not

been disposed of and will not be moved.

After the vacation of the premises and prior to the approval of payment, the realty

specialist shall inspect the vacated premises to be certain that only items of personalty

were moved. The realty specialist shall also inspect the new location (within 5 days

following the move) to verify that the personal property has actually been relocated and/or

reinstalled in accordance with the moving authorization. A written report of the post-move

inspection shall be prepared and made part of the case file.

4.20.15 Moving Payment Approval

Moving reimbursement and reestablishment expenses shall be actual, reasonable and

necessary. Claims for moving reimbursement must be on State Invoice Form AR/50/54,

accompanied by the mover's receipted bill and the moving reimbursement claim Form RE-

92. The occupant may request and be granted the option of a direct payment to the mover.

Claims shall be accompanied by a certification from the occupant that the personal

property was actually moved and movers shall also submit a certification that they

performed the work presented in the claim and that they were paid by the occupant for

services performed. The realty specialist performing the post-move inspection shall

document the results of the inspection in the realty specialist’s relocation call data and on

the database for the displacee/relocatee.

At this point, the claim may be endorsed by the District Program Manager and processed.

All moving reimbursement, reestablishment and fixed payments require Department

Actions authorizing the payment prior to transmitting the Project Funding Unit of the

Bureau of Technical Support for payment processing and review. The invoices with the

expense distribution sheet, frap, W-9, if not already on file, and other supporting

documentation and appropriate claim forms are to be submitted with the Department

Action.

115

4.20.16 Self Moves

A business, farm or non-profit operation may be authorized to perform the relocation of

its personal property under the following conditions:

A. The application shall be made in advance of the move on the Self-Move Agreement,

formerly known as Form RE-154 and be approved by the Director. Applications shall be

accompanied by an inventory describing the items to be moved. Those items not being

moved as part of the Self-Move, must not have been included in the estimates obtained

that was used to determine the Self-Move amount to be paid. Those items not part of

the Self-Move may be paid as reimbursement items for the actual cost associated with

their move. This may occur when you have specialty items that can only be moved by

the manufacturer or a specialist.

B. The three moving cost estimates shall be obtained by the realty specialist from licensed

movers; or prepared by qualified staff. Provision shall be made for all allowable costs,

including cost of supervision of the move, insurance, equipment rental and permits. In

circumstances where estimates cannot be obtained, the occupant may be paid actual,

reasonable moving costs supported by receipted bills or other evidence of expenses

incurred, at the Discretion and with the Approval of the District Program Manager. The

amount to be paid for a self-move shall not exceed the lower of the three estimates.

C. The self move option relieves the displaced business or farm operator from

documenting all moving expenses. Payment for the items to be moved may be made

without additional documentation as long as payment is limited to the amount shown

on the approved and executed Self-Move Agreement and the Department has

verification from the realty specialist assigned the relocation that the move has been

complete or if the payment is made in more than one payment that the conditions of

the Self-Move have been met to warrant the payment. Claim for payment shall be shall

include the approved Self-Move Agreement, the Department action, invoice, expense

distribution sheet, frap and W-9, if not previously submitted.

D. Payment shall not be processed until a post-move inspection has been accomplished to

verify that the occupant has accomplished the move and vacated the premises.

Payment may be provided in installments, permitting a third to be provided at the start

of the move, a third upon 50 % completion of the move and a third at the end of the

move. This payment option will be spelled out in any eventual Self-Move Agreement.

E. Payments under a self-move are for moving expenses and the displacee remains eligible

for other payments outside of the move such as reestablishment expenses and other

non-move reimbursable expenses

4.20.17 Expense Finding (Commercial or Residential Personal Property)

In the event that FHWA regulations are amended to permit an expense finding, the District

may arrange for a qualified realty specialist (other than the realty specialist handling the

relocation case) to prepare an expense finding (in lieu of regular moving costs), not to

exceed the amount set in FHWA regulations for those moves where only personal property

is being displaced. Payment will be based upon the requirements set forth in that

regulation.

The amount of the expense finding must have written justification for the amount of the

expense finding. This justification shall be prepared in the District and approved by the

District Manager.

116

4.20.18 Reestablishment Expenses And Related Eligible Expenses

4.20.18.1 Nonresidential Reestablishment Expenses

A business having not more than 500 employees working at the acquired site, farm or

nonprofit organization may be eligible to receive a total payment, not to exceed

$25,000.00, for expenses incurred in reestablishing the business at the replacement site.

Sites occupied solely by outdoor advertising signs, displays or devices do not qualify as a

business for the purpose of reestablishment expenses. Reestablishment expenses must

be reasonable, necessary, actually incurred.

A. Eligible expenses include the following:

Repairs or improvements to the replacement real property as required by Federal, State

or local code, as well as modifications to the replacement property to accommodate

the operation or to make the replacement structures suitable for conducting the

business

Construction and installation costs for exterior signing to advertise the business on the

replacement site, redecoration or replacement of soiled or worn surfaces at the

replacement site, such as paint, paneling or carpeting

B. Advertisement of the replacement location

Modifications to the replacement property to accommodate the business operation or

make replacement structures suitable for conducting the business.

Redecoration or replacement of soiled of worn surfaces

Estimated increased costs of operation during the first 2 years at the replacement site

for such items as leasing costs, personal/real property taxes, insurance premiums and

utility charges, excluding impact fees, and other items that the District Program

Manager considers essential to the reestablishment of the business

4.20.18.2 Ineligible Reestablishment Expenses

Purchase of capital assets, such as, office furniture, filing cabinets, machinery or trade

fixtures, manufacturing materials, production supplies, product inventory, or other items

used in the normal course of the business operation; interest on money borrowed to make

the move or purchase the replacement property; and payment to a part time business in

the home which does not contribute materially to the household income.

4.21 Underground Storage Tanks on Acquired Property

During the preliminary engineering phase, the Bureau of Landscape Architecture and

Environmental Solutions (BLAES) screens those properties, which are considered likely

candidates for the presence of underground storage tanks. BLAES sends the owner a letter

and the results of the investigation and sampling, providing the owner time to conduct its

remediation activities prior to acquisition of the property. Residential underground oil

tanks which are found to be leaking will be addressed by NJDOT on a case by case basis,

taking into account circumstances where the tanks are used for a nonresidential use.

Where underground storage tanks are encountered, the acquisition of such properties

should be accorded a high priority during the acquisition process to permit sufficient time

for proper closure.

117

4.21.1 Decommissioning of Underground Tanks

Decommissioning is the process of excavating, cleaning, degassing or removal of an

underground storage tank system. The New Jersey Department of Department of

Environmental Protection (NJDEP), regulates the decommissioning of such tanks.

The realty specialist will provide the owner with a copy of the Individual Parcel Map and

explain why the acquisition will require the removal of the underground storage tank(s)

(USTs). The owner will be requested to provide the tank registration information that

should have been previously obtained from NJDEP. The owner shall be asked if there are

other USTs on the property and their locations.

NOTE: If it is determined that the USTs should have been registered with NJDEP but were

not, then the owner is responsible for the costs of registration and closure. If this is done

by the Department then reimbursement will be sought from the owner. For properly

registered tanks, the owner will be reimbursed for the reasonable costs of removing

registered USTs or USTs which were exempt from registration. Payments made for

decommissioning tanks should be clearly labeled “tank decommissioning costs.”

The realty specialist shall discuss the following options, available to the owner, to

accomplish the removal of underground tanks:

Option A (Owner Decommissions Tank and Remediates Site)

If the tank(s) are properly registered with NJDEP, the owner will be reimbursed for the

actual, reasonable costs incurred in the decommissioning of the tank(s). The owner may

be able to accomplish the removal at a lesser cost than the Department. If the owner elects

this option, the Department reserves the right to monitor the decommissioning of the

tank(s). The owner must comply with NJDEP closure requirements for underground storage

tanks. Costs incurred by the owner for site cleanup costs related to discharges are not

reimbursable.

The following are reimbursable decommissioning costs:

Reasonable costs incurred for a Licensed Site Remediation Professional (LSRP)

Costs include necessary documentation, reports, remediation plans, etc.

Reasonable and necessary Contractor costs

Costs for excavation, cleaning and disposal of tanks

Installation of required groundwater monitoring wells and sampling

Post-excavation soil samples

NJDEP closure fees (does not include registration or annual certification fees)

BLAES may at its discretion retain a consultant to monitor the work performed by the

owner’s LSRP and/or contractor and BLAES or the consultant may: review the contractor’s

cost estimate for decommissioning to ensure that projected costs are reasonable and do

not include site remediation activities. BLAES approval is required prior to the LSRP

submitting the NJDEP Reporting Form;

Conduct a periodic review to ensure that the LSRP secures all necessary permits and

accomplishes the required submissions to NJDEP correctly and in a timely manner;

Monitor contractor progress to ensure that the tanks are decommissioned in accordance

with the DOT project schedule;

Ensure that the owner/contractor provides sufficient prior notice of the date on which the

excavation will take place to enable proper monitoring by BLAES or its consultant;

118

Option B (Department Decommissions Tank and Remediate Site)

The owner shall be informed that the Department will contract with a consultant/contractor

to decommission the tank(s) and to accomplish any necessary site remediation to the

extent required for the project. Unless provided otherwise, groundwater remediation will

need to be conducted by the Owner. The Department will pay all normal decommissioning

costs, and will seek reimbursement from the owner for any site remediation costs.

4.21.2 Decommissioning Process

In order to decommission an underground storage tank, the owner/Department must

comply with prevailing NJDEP regulations and the decommissioning must be accomplished

in accordance with the provisions of an approved Closure Plan.

Subsequent to the decommissioning, the owner/Department must submit a final report to

NJDEP detailing the closure activities.

4.22 Advertising Signs

4.22.1 Policy

In those cases involving the partial acquisition of real property, signs within the area of

the parcel to be acquired, whether owned by the tenants or the property owners, are to

be treated as relocation items, unless the circumstances otherwise justify a determination

that they constitute part of the realty or are fixtures. To the extent possible, the District,

in consultation with the PM and Community Relations should attempt to address the

relocation of signs with the municipality as early as possible in the project to seek a blanket

policy by the municipality of how to handle approval of sign relocation. In many cases the

municipality may agree to a less complicated approval process that would simplify the

relocation and limit delays at the end of the project.

Relocation of on-premise (advertising/trademark) signs will necessitate obtaining the

necessary local/municipal approvals wherein the sign is located. However, where the

contractor for the State relocates the sign, permits may not be necessary when the

following conditions are met:

1. The Project Manager or other authorized State representative has drafted a plan of

reinstallation in compliance with applicable municipal requirements and consulted

with the municipality:

2. Arrangements are made for inspection of the reinstalled sign by the municipality;

and

3. The municipality has agreed to issue a Certificate of Occupancy or other form of

written approval.

Off-premise (billboards/poster panels) sign panels which have been erected and

maintained pursuant to a valid State outdoor advertising permit may be relocated.

However, the supports and foundation of billboards are to be considered realty, and not

relocated. Applications for a State outdoor advertising permit are made to NJDOT’s Office

of Outdoor Advertising Services. Issuance of an unconditional State outdoor advertising

permit will also entail obtaining all relevant municipal permits. The owner of the off-

premise sign is responsible for obtaining the State permit and all other required approvals.

The owner of the advertising sign is eligible to be reimbursed:

1. For the actual, reasonable costs incurred in the relocation of the sign; or

119

2. For the actual direct loss of an advertising sign when the owner of the sign is entitled

to relocate it, but does not do so. The amount of the direct loss will be the lesser of

the depreciated reproduction cost of the sign, less the proceeds from its sale; or the

estimated cost of moving the sign, but with no allowance for storage.

Owners of advertising signs are eligible for reimbursement for their actual, reasonable

expenses in searching for a replacement sign site, not to exceed $2,500.00. A relocation

payment shall not be made if the sign is moved to a replacement site in violation of any

Federal, State or local regulations.

4.22.2 Sign Relocation Process

When the project is transmitted to the District Office to initiate acquisition, the Project

Realty Specialist 4 will contract under Procurement oversight with a professional sign

contractor who will be responsible for:

1. Inventorying the advertising signs to be relocated,

2. Assuring that municipal approvals/permits/variances/site plans necessary to

relocate the sign to the remaining property have been secured by the sign owner.

3. Documenting the costs necessary to accomplish the relocation.

4. Liaison with the sign owner regarding the selection of a location to which the sign

will be relocated on the remaining property.

5. The physical relocation of the advertising sign to the remaining property.

Several sign companies should be pre-qualified to perform the service and utilize a

standard format for preparation and presentation of estimates. The scope of work shall

clearly set forth the responsibilities of the consultant sign company as with an NRE report

order.

As far as possible, one contractor should be assigned the responsibility for a given project

in order to more efficiently handle municipal applications for permits and/or site plans and

variances. If the sign contractor obtains approvals for the sign and/or relocates the sign,

the owner would not receive any reimbursement for those costs. If a municipality delays

granting site plan/variances necessary for the sign relocation, but does not object to the

move, the Department can provide for storage for the sign and compensation for

restoration of the sign and approval costs. If a municipality denies site plan/variances

necessary for the sign relocation, after a good faith effort to comply with the ordinances,

the Department can provide the owner with the depreciated value of a the sign, together

with the typical cost for approvals of the sign as compensation for the sign. Likewise, if

the owner declines to move the sign, the Department can reimburse the depreciated value

and costs associated with the approval and consider the sign to be a part of the real estate

and demolish the sign. If the sign can be replaced but the current sign can no longer be

used under municipal ordinances, the Department can reimburse the current cost of a

typical sign which would be approved, together with the costs to obtain approvals. While

the Department is not subject to local ordinances, the property owner is subject to local

ordinances and must not be placed in the position of violating local ordinances by virtue of

having a sign relocated without permission from the municipality.

The owner/tenant should be contacted early on in the process and encouraged to

participate in the process of selecting an alternative site for the relocated sign. This

approach would minimize or eliminate those instances where a property owner may desire

to create severance damages due to the inability to relocate a sign.

120

The estimated cost of relocation of the sign will be provided to the owner occupant with

the written tender of the fair market value; or to the tenant sign owner under the normal

relocation advisory assistance and payments process. At this point, the sign consultant will

have secured the necessary site plan/variance approvals. The owner/tenant would be given

the right to relocate the sign to the remainder, or alternatively, to have the State’s sign

contractor accomplish the relocation. If there is an entire take and there is no available

site to relocate the sign, the realty specialist shall obtain an estimate of the depreciated

value of the sign in place.

An alternative procedure is to have the preferred sign company hired by the Designer to

the initial research (preferred location, permit requirements, etc.) and then pick up the

contract through ROW or through the Construction Contractor. This method will also

require oversight from Procurement.

4.23 Mobile Homes

This section governs the provision of relocation payments to a person displaced from a

mobile home and/or site, who meets the eligibility requirements. The displaced person is

entitled to moving expense and replacement housing payments to the same extent and

subject to the same requirements as persons displaced from conventional housing. If the

mobile home is not actually acquired, but the occupant is considered displaced from the

site, initiation of negotiations is the initiation of negotiations to acquire the land; or if the

land is not acquired, the written notification that the occupant is a displaced person.

4.23.1 Moving Expenses

A person displaced from a mobile home and/or site is entitled to payment for the actual

cost of moving the mobile home as prescribed in C. Relocation, Section 4.12. A non-

occupant owner of a rented mobile home is eligible for actual moving cost reimbursement

as prescribed in Section 4.13. If the mobile home is not acquired, but the occupant obtains

a replacement housing payment and the land where the mobile home is situated is

acquired, the owner is eligible for payment for moving the mobile home, as well as eligible

for a payment to move the owner’s personal property from the mobile home.

A displaced mobile homeowner, who moves the home to a replacement site, is eligible for

the reasonable cost of disassembling, moving and reassembling any appurtenances, such

as porches, decks, skirting and awnings as well as utility "hook-up" charges. If a mobile

home requires repairs and/or modifications so that it can be moved and/or made decent,

safe, and sanitary and it is determined that it would be economically feasible to incur the

additional expense, the reasonable cost of such repairs and/or modifications is

reimbursable. A non-returnable mobile home park entrance fee is reimbursable (to the

extent it does not exceed the fee at a comparable mobile home park), if the person is

displaced from a mobile home park or it is determined that payment of the fee is necessary

to effect the relocation.

4.23.2 Replacement Housing Payment - 90-Day Mobile Home Owner Occupant

A displaced owner occupant of a mobile home is entitled to a replacement housing

payment, not to exceed $31,000.00, if:

 The person owned the mobile home and occupied it on the subject site for at least

90 days immediately prior to the initiation of negotiations and the person meets the

other basic eligibility requirements as prescribed in Section 4.7.0.

 The mobile home and/or site is acquired; or the home is not acquired but the owner

is displaced because it is determined that the mobile home cannot: (a) economically

121

be made decent, safe and sanitary; or (b) be relocated without substantial damage

or unreasonable cost; or (c) be relocated because there is no available comparable

replacement site; or (d) be relocated because it does not meet mobile home park

entrance requirements.

If the mobile home is not acquired and the District Program Manager determines that it is

not practical to relocate it, the acquisition cost of the subject mobile home used when

computing the price differential amount, shall include the salvage value or trade in value

of the mobile home, whichever is higher.

4.23.3 Replacement Housing Payments - 90-Day Mobile Home Tenant

A displaced tenant or owner occupant of a mobile home is eligible for a replacement

housing payment, not to exceed $7,200.00 if the:

 Person actually occupied the mobile home on the subject site for at least 90 days

immediately prior to the initiation of negotiations;

 Person meets the other basic eligibility requirements as prescribed in Section 4.9 or

4.10; and

 Department acquires the mobile home and/or site, or the mobile home is not

acquired, but the owner or tenant is displaced from the mobile home because of

other circumstances, as described in Section 4.19.2.

4.23.4 Replacement Housing Payment Based on Mobile Home and Site

Both the mobile home and mobile home site must be considered when computing a

replacement housing payment. A displaced mobile home occupant may have owned the

mobile home and rented the pad site, or may have rented the mobile home and owned the

pad site. Also, a person may elect to purchase a mobile home and rent a site, or rent a

mobile home and purchase a site. In such cases, the total replacement housing payment

shall consist of a payment for a dwelling and a payment for a site, each computed under

the applicable section of Sections 4.7.1 and 4.9.1. However, the total replacement housing

payment shall not exceed the maximum payment (either $31,000.00 or $7,200.00)

permitted under the section that governs the computation for the dwelling.

4.23.5 Comparable Replacement Dwelling

If a comparable replacement mobile home is not available, the replacement housing

payment shall be computed on the basis of the reasonable cost of a conventional

comparable replacement dwelling. The term mobile home as defined by Federal regulations

includes manufactured homes and recreational vehicles used as residences. Such

accommodations can also include house boats if they are consistent with local codes and

meet DSS requirements.

If the District Program Manager determines that it would be practical to relocate the mobile

home, 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. The owner

would be eligible for moving costs described at 49 CFR Part 24.301 and any replacement

housing payment for the purchase or rental of a comparable site as described in this section

or 49 CFR Part 24.503 as applicable.

4.23.6 Mobile Home Relocation

If the owner is reimbursed for the cost of moving the mobile home, he or she is not eligible

to receive a replacement housing payment to assist in purchasing or renting a replacement

122

mobile home. The owner may be eligible for assistance in purchasing or renting a

replacement site.

4.23.7 Partial Acquisition of a Mobile Home Park

The acquisition of a portion of a mobile home park may leave a remainder that is not

adequate to continue the operation of the park. If it is determined that a mobile home

located on the remainder must be moved as a direct result of the project, the occupant

shall be considered a displaced person and is entitled to relocation payments and other

assistance.

4.24 Last Resort Housing

In the event the statutory maximum amounts of $31,000 and $7,200 will not afford the

relocation of the mobile home displace (owner or tenant), within their financial means, the

provisions of housing of last resort as discussed in Section 4.2.7 will be used.

4.25 Transient Occupants of NJDOT land

The Division will provide such relocation support as is determined to be legally appropriate

to assist Operations in addressing transient occupants of NJDOT land.

4.26 Relocation Appeal Process

Any person may file a written appeal, regardless of form, where the person believes that

the Department has failed to properly consider her/his application which may include, but

is not limited to, the person's eligibility for, or the amount of, a relocation payment. The

appeal must be initiated within ninety (90) days after the person receives written

notification of the Department’s determination on the claim. The written appeal shall be

addressed to the District Program Manager. If the matter is not resolved, the person may

request an in-person review by writing to the Director, Right of Way.

A person has the right to be represented by counsel or other agent, at the person's

expense. The person shall be permitted to inspect and copy all materials pertinent to the

appeal, except those considered confidential. Reasonable conditions may be imposed on

the person's inspection of documents. In deciding an appeal, all materials submitted shall

be considered to ensure a fair and full review of the appeal.

Confidential items that may be withheld from appellant’s inspection include, but are not

limited to personal data such as Social Security numbers, financial data, phone numbers,

etc.

Within 30 calendar days after receipt of all information from the person in support of an

appeal, the Department shall make a written determination, including the basis for the

decision and furnish the person a copy. If the full relief requested is not granted, the person

shall be advised of her/his opportunity to request a contested case before the Office of

Administrative Law.

An LPA with a relocation appeal should direct that to the Director of the Division of Right

of Way & Access Management to conduct an appeal hearing. If the relocatee is not satisfied

with the appeal, they may appeal to the Office of Administrative Law.

4.27 Leasing

4.27.1 Establishment of Rental for Leases in Connection with “Active Projects”

When a displaced person desires to temporarily remain in possession of the acquired

property through a lease, the District Program Manager will confirm that a fair rent was

123

established for the unit. For tenants, the rent shall normally be the average rent that the

tenant has paid for the unit over the preceding 12 months prior to the acquisition. For

owners, fair rent shall be economic rent for the dwelling occupied.

Consideration shall be given to the condition of the property and the terms and conditions

of the occupancy, specifically the short term nature of the lease and the responsibility of

the lessee to be responsible for utilities and repairs. The rent shall not exceed fair market

(economic) rent for similar properties in the area and shall be predicated upon a short-

term occupancy and conditions of the lease.

Adjustments from the average rent paid over the preceding 12 months (tenants), or the

economic rent (owners) shall be approved by the District Program Manager prior to

submission to the Director of Right of Way for approval:

1. If the historic rent exceeds fair market rent;

2. If the services provided are less than the occupant previously received;

3. If the occupant is to provide services; or

4. For demonstrated hardship. For residential occupants, the rent rate shall not exceed

the ability to pay standards 30% of the family’s gross monthly income for low income

as established by the U.S. Department of Housing and Urban Development's Public

Housing and Section 8 Program Income Limits.

All leases shall state that lessee is responsible for all utilities and all repairs, unless

otherwise stipulated in the lease.

All leases are to be approved by the Director.

Additional information on leasing is contained in Property Management Leases.

The Department may elect to issue a temporary license to residential occupants permitting

them to continue to occupy the premises until notified to vacate. A license does not require

payment, and does not create a landlord tenant relationship. In this scenario, the owner

would be responsible for maintenance in lieu of lease payments. Substantial costs such

as failure of a furnace would be considered for payment by the Department.

4.27.2 Rental to Public Agencies or Persons Not Displaced

Properties may be rented to other public agencies and organizations for public purposes at

a nominal cost. In such cases, the rental rate shall be approved by the Director. When

leasing to entities or persons not displaced by a project, the rent shall be established as a

result of an appraisal if the land is available to only one user or through a public auction if

the property can be used by more than one entity. The Manager of the Bureau of Technical

Support shall oversee the establishment of the economic rent, which shall serve as the

minimum bid at the auction which shall be conducted in accordance with standard auction

procedures.

4.27.3 Protective Leasing

Instances may arise where the occupants of a dwelling relocate subsequent to the initiation

of negotiations, but prior to closing of title or court deposit. In order to prevent re-

occupancy, the Department may enter into a Protective Lease.

Protective leasing may also occur where NJDOT or LPA chooses to rent a vacant unit to

prevent an owner from leasing. Protective Leasing is a mechanism designed to

compensate owners for lost rental income, while avoiding the costs and time delays

124

associated with relocation, including moving expenses and supplemental housing

payments.

Protective leasing may only be utilized with the approval of the Manager of the Bureau of

Technical Support. Protective Leasing is not to be pursued prior to the initiation of

negotiations for the parcel.

Subsequent to the appropriate approvals, the realty specialist shall have a Lease

Agreement executed by the owner, which prescribes the specific term of the agreement

and the consideration to be paid. Documentation must be included setting forth how the

monthly rental was determined. The projected monthly rental could be predicated on the

amount paid by a prior tenant (supported by the actual lease document), or comparable

rentals in the area. The Lease Agreement will be drafted only after consulting the Bureau

of Technical Support and the Departments legal counsel.

The agreement, together with the supporting documentation and the Department Action

will be sent to Technical Support for approval by the Director of Right of Way. Once the

agreement is approved, the realty specialist must actively pursue, if not already done, the

completion of negotiations and submit the case to Bureau of Technical Support for an

agreement or condemnation, thereby minimizing the funds expended on the Protective

Leasing Agreement.

4.27.4 Lease Agreements for hold over tenant

Displaced persons wishing to remain in occupancy after the date the State takes

ownership, shall execute the Departments approved dwelling lease occupancy agreement.

No Lease is effective until signed by the Lessee and the Director of Right of Way. Upon

execution by the Director of Right of Way, the lease agreement will comprise the rental

arrangement between the occupant and the State. All lease agreements require a

Department Action. All lease rental amounts must have justification as to how the rental

was determined and will show what portion of the total monthly rental is for the “In Lieu

of Municipal Services” charge. The rental amount will be determined by an appraiser.

4.27.5 Starting Date of Rent

 All Tenants of Former Owners - Rents shall accrue and be collected from the first of

the month following the acquisition date. Any rent prepaid to the former owner

beyond the rental date shall be collected from the former owner at the time of

settlement.

 Former Owner Occupants - The rent shall begin the first day of the month following

the date of closing. Leases shall begin as of the date of closing to establish a

landlord-tenant relationship as of that date. The interim from the closing until the

first day of the following month shall be on the basis of a one-dollar lease.

 Other Rental Occupancies - Rent shall be payable as of the first day of the month

following the execution of a lease, unless specific circumstances indicate that other

provisions would best serve the public interest.

4.27.6 Lease Approval Process in connection with “active projects”

Leases in connection with “active projects” shall be prepared in the District Offices and

reviewed by District Program Manager prior to submission to the Director for approval. The

District Program Manager shall ensure that a Department Action is prepared and

transmitted with the lease along with any agreement regarding the acquisition to the

Bureau of Technical Support. A copy of the lease will also be sent to the Technical Support

125

Bureau. Upon approval of the action, the District Program Manager shall notify the

proposed tenant, in writing, of the lease approval and provide the tenant a copy of the

executed lease. The letter shall inform the tenant that notification will be sent with regard

to the date the rent is due and that the rental is to be transmitted to the Manager of the

Technical Support Bureau. This notice will be sent out by the District and a copy provided

to the Technical Support Bureau. The District Program Manager shall ensure that the

Technical Support Bureau is notified if the tenant moves before the State acquires the

property. The notification to pay rent will be coordinated between the Districts and the

Bureau of Technical Support Property Section.

The District Program Manager and the Technical Support Bureau shall mutually establish

and maintain a data base containing information on rental collections, arrearages and

expenses incurred in maintaining the rental properties. A separate rental account number

shall be established for each lease and this number shall remain constant, even though a

unit is vacated and then re-occupied. The account number shall be placed on all

Department Actions and on all rental records.

4.27.7 Receipt and Posting Rentals Collected

All payments for the lease accounts are to be sent to the Manager of the Bureau of

Technical Support, Right of Way. The Secretary will proceed to present all checks to the

designated representative of the Project Coordination and Funding Unit of the Technical

Support Bureau, Right of Way for the purpose of recording the receipt of payment in the

data base system. All checks will also be scanned at this time and will be stamped “For

Deposit Only By NJDOT”.

4.27.8 Rental Deposits and Mailing of Receipts of Payment Received

After the designated representative of the Project Funding Unit has logged in the receipt

of the

rental payment, the check will be provided to a designated representative of the

Relocation &

Property Management Section of the Bureau of Technical Support. The

designee will log the

receipt of the payment into the appropriate rental account in the

Property’s rental data base, recording the following:

1. The Cashier Receipt number for the deposit, which is recorded after the deposit has

been made

2. The date the payment was due, which is the month the payment is being applied

for

3. The date the payment was received

4. The amount of the payment, noted as “Rent” in the data base

5. The portion of the rent payment received for the municipal service charge, noted as

“Escrow” in the data base

6. The portion of the rent payment for the base rental, noted as “Net” in the Data Base

7. The Check Number of the rent payment received

8. Any Comments, noted as “Notes” in the data base.

Once the rent payment has been logged into the appropriate rental lease account, a rental

deposit slip for the relevant federal or state associated account will be prepared and the

payment and rental deposit slip will be taken to NJDOT Cashier for deposit. A copy of the

check will be made, along with a copy of the rental deposit slip before taking the payment

to the Cashier and will be kept in the individual lease account rental file and in a master

126

file, where all receipts for the calendar year are kept. All rental payments received will be

recorded in PAECETrak and a log to allow for reports of rental funds received. The cashier

will provide a receipt of all deposits made, and a copy will be made for each of the

appropriate lease rental account files and a copy of the rental deposit slip will also be

provided to the designee of the Project Funding Unit and the receipt number will be

recorded into each of the appropriate lease rental accounts in the data base by the Property

Management Section Designated representative that made the deposit. A copy of the entry

into the rental data base shall be printed and kept in the appropriate rental lease file.

Once a receipt number has entered into the individual rental lease account, the Relocation

& Property Management designee will mail the lessee an acknowledgement letter of the

amount of the rent payment received and as to what month the payment was applied

towards. If there is an outstanding rent payment due, it will be noted as to the amount

and for what month(s). This notice will be sent certified mail only if there is an outstanding

rent due balance. A copy of the letter will be kept in the lease account file and a comment

about the rent owed will be made in the appropriate rental account in the rental data

base in the Notes section, specifically the comment will state the date the notice was sent

about the rent arrears owed.

Income from all rental sources shall be deposited daily.

4.27.9 Delinquent Rentals

All rents become due as of the first of each month and must be paid no later than the 10th.

No extension will be granted beyond the 10th of the month unless approved by the District

Program Manager. Application for extensions must be initiated by the tenant. On the 15th

of each month a letter (copy to the Project Funding Unit) shall be mailed to any delinquent

tenant outlining the eviction policy and stating that legal action may ensue unless payment

is made no later than the 20th of the month.

After 60 days, the Supervisor, Property Management Section shall determine if the

delinquency warrants referral to the Department of Law for collection and/or eviction. A

diligent effort shall be made to collect all rents; however, some accounts are uneconomical

to pursue. If, after reasonable efforts have been taken and the Supervisor determines that

there is no reasonable prospect of collection, or that further efforts to collect would be

uneconomic or unwarranted, a Department Action shall be prepared to write off the

uncollectable rents. Any uncollectable rents shall be charged against the project operating

expenses.

With regard to lease accounts where rental is due from a non-residential occupant(s), the

District Program Manager or designee shall in conjunction with the Supervisor of the

Relocation & Property Management Section of the Bureau of Technical Support arrange to

collect all back rents owed the Department before releasing any relocation payments to

the occupant. Any claims or obligations, including back rents owed by the displacee cannot

be offset against any relocation benefit entitlements of the displaced person or business.

This does not mean that the Department is precluded from pursuing other legal means to

satisfy the claims or obligations, including back rent, from the displacee.

4.27.10 Rental Eviction Policy

On the 1st of each month, following a total month’s delinquency, a 30-day notice to quit

and demand for possession may be issued (at the Manager’s discretion) to any tenant who

has failed to respond to the notices. The 30-day notices shall be sent only if the required

90-day notice has expired for those leases entered into in association with an active job.

127

Eviction of tenants shall be used only as a last resort and shall be undertaken only under

one or more of the following circumstances:

1. Failure to pay rent;

2. Maintenance of a nuisance or use of the premises for illegal purposes;

3. A material breach of the rental agreement;

4. Refusal to consider a reasonable number of accommodations meeting relocation

standards;

5. Refusal to admit a realty specialist; and

6. Situations requiring eviction under State or local law or regulation.

An otherwise eligible occupant, evicted for cause after the initiation of negotiations, retains

the right to relocation payments and other assistance. Deductions for rental arrearages

may not be made from relocation funds.

4.27.11 Statutory Requirements for Property Leasing

The District will be responsible for temporary leases on properties being acquired for a

project. A lease may be used if the project schedule provides enough time to allow an

existing occupant to continue to reside in the acquired property for a limited period of time.

The District may also undertake with the assistance of The Property Management Section

to implement a protective lease, described later to prevent new tenants from moving into

a property that is being acquired. The Districts will prepare all leases on active projects in

accordance with N.J.S.A. 27:7-21.4, N.J.S.A. 27:7-21.6 and N.J.S.A. 52:31-1.8.

N.J.S.A. 27:7-21.4 authorizes leasing property acquired for transportation purposes and

provision for termination of lease - Any real or personal property acquired by the

Department of Transportation for a transportation or transportation related program or

project may be leased by the Commissioner of Transportation to any person or public body

or agency on a temporary basis. The Commissioner shall include a provision in the lease

which would allow the termination of the lease upon written notice thereof to the lessee

prior to the conclusion of the term of the lease in accordance with a minimum period of

time for that notice, such provision having been the subject of negotiation between the

Commissioner and the prospective lessee, so as to ensure that the occupancy of the

property does not in any manner interfere with or delay the transportation program or

project for which the property is needed. No person, public body or agency shall remain in

possession of premises beyond the conclusion of the term of the lease or, in the case of a

notice of termination, the date fixed by the Commissioner in the notice. If the lessee

remains past conclusion of the term of the lease or beyond the date fixed in the notice of

termination, the department may institute a summary proceeding in the Superior Court,

for an order to show cause as to why the department should not be granted immediate

possession of the leased property and the property be vacated of its occupants.

4.27.12 Maintenance of Leased Property

From the date of acquisition until a structure is vacant, the Department shall maintain

plumbing, heating and electrical systems in an operating condition; shall make repairs

necessary to keep the premises habitable; provide for the extermination or control of

rodents and other vermin; and do anything necessary to protect the health and safety of

the occupants.

128

N.J.S.A. 27:7-21.5. Management, maintenance, repair and operation of leased property -

The Commissioner is hereby authorized to perform or contract for the performance of all

acts necessary for the management, maintenance, repair and operation of property leased

pursuant to this act and to expend moneys out of any rentals received for such

management, maintenance, repair or operation.

Procurement Policy - The Department’s Procurement Office should be contacted to

undertake a work order.

Minor Repairs and Replacements - If minor repairs and replacements are necessary to

keep rented properties habitable, the realty specialist shall inspect the property and on

verification of the need, will begin the P Card process in accordance with Policy #814.

Upon approval by the District Program Manager, the repair may be ordered from reputable

vendors, utilizing the competitive bidding process approved by Procurement. Upon

completion of the work, the invoice and the Repair Authorization Form shall be transmitted

to the Project Funding Unit of the Bureau of Technical Support and then to Accounting for

payment. A Department Action is not required. Major Repairs and Replacements -

Generally, where major repairs or replacements appear necessary, consideration should

be given to relocating the tenants to other habitable properties owned by the State. All

major repairs shall be approved by the District Program Manager after conferring with the

Director.

Emergency Repairs - Emergency repairs necessary to protect the health and safety of the

occupants will be treated as minor repairs and replacements and the District Program

Manager may contract directly with a reputable vendor, without the necessity of securing

competitive bids.

4.27.13 Management of Multiple Unit Leased Properties

Properties containing multiple units may require the provision of heat, electricity and

janitorial services. Such items shall be processed in a manner similar to repairs and

replacements. The District Program Manager, with approval of the Director, may contract

with private management firms for very large properties and, on smaller properties, a

tenant may be authorized to perform services. Where a tenant provides services in lieu of

rental, the difference between the rent charged and the lease amount shall be charged to

the property as an operating expense.

4.27.14 Registration of Leasehold Information

Chapter 170, NJ Laws of 1980 requires every landlord of a residence containing one or

more units to file a registration certificate with the Clerk of the municipality in which the

residential property is situated - Form RE-202.

Chapter 442, NJ Laws of 1981 requires landlords of residences containing one or more

units to provide each residential occupant or tenant with a copy of the registration

certificate. The landlord must provide each occupant or tenant a copy of any amended

certificate within seven days after such amended certificate is filed with the municipal clerk.

Chapter 48, NJ Laws of 1974 requires landlords of residences containing ten or more units

to provide tenants "information regarding crime insurance."

Chapter 310, NJ Laws of 1975, "Truth in Renting Act," requires the distribution of a

statement to tenants as to the rights and responsibilities of landlords and tenants. The

provisions of this Chapter are applicable to landlords of residences containing three or

more units.

129

N.J.S.A. 55:13A-7.12a may require the installation of child safety window protection for

units on a second floor or higher where children are under the age of Ten (10)

Local municipalities may also require registration of residential rental properties. The

District should request guidance from Technical Support Bureau. Repairs needed should

be discussed to determine if a waiver should be requested based upon limited duration of

occupation.

Registration Process - The District Program Manager on active projects is responsible for

registering the rental unit with the Clerk of the municipality in which the unit is located, by

certified mail on Form RE-202. The duplicate copy of this form shall be provided to the

tenant and remaining copies shall be retained in the District Office. The certified mail

receipt from the postal authority shall be made a part of the permanent case file.

Truth in Renting - Copies of "Truth in Renting-A statement for Landlords and Tenants,”

published by the New Jersey Department of Community Affairs shall be utilized where

residences contain three or more residential units. The agent is responsible for posting the

“Truth in Renting" statement in the residence and all residential leases shall include a

statement acknowledging receipt of a copy of the statement.

Crime Insurance - Information regarding crime insurance obtainable through the Federal

Crime Insurance Program will be furnished by the agent to tenants in residences containing

ten or more residential units and all such residential leases shall include a statement

acknowledging receipt of said crime insurance information.

4.27.15 Real Estate Taxes and the Payment of the In Lieu of Municipal Services

An In Lieu of Municipal service charge in lieu of local taxes shall be charged to each tenant

in the amount of 1/12 of prorated share of the tax on the property in the year it was

acquired if available, if not then an estimated amount in accordance with N.J.S.A. 27:7-

21.7. Such payments are to be made to the municipality in which a property is located,

except that no payment shall be made for that portion of the year which has been

previously paid by the State or the former owner. In the event that such a payment was

made, the municipality will be requested to refund the payment.

Remainder of Tax Year in which Property is Acquired - The State is required to pay the

taxes for the remainder of the tax year in which a property is acquired and taxes for this

period are an acquisition expense and shall be paid by the Title Section.

Subsequent to Tax Year in which Property is Acquired - The designee of the Property

Management Section of the Bureau of Technical Support will maintain in the rental data

base that portion of the rental collected for each account that is for the In lieu of municipal

services.

N.J.S.A. 27:7-21.7. Monthly service charge payable by lessee; in lieu of local property or

leasehold estate taxes - Every lease agreement, except leases entered into by public bodies

or agencies for public purposes, nonprofit housing corporations, or with persons or for uses

exempted from taxation pursuant to the provisions of Title 54 of the Revised Statutes,

shall contain a provision requiring the lessee to pay to the Department of Transportation,

in addition to the rental price, a monthly service charge in lieu of local property or leasehold

estate taxes for each month or portion thereof of possession or occupancy, said charge to

be equal to 1/12 of the tax on the property for the year in which it was acquired by the

Department, if such tax information is available or estimated if it is not available. All such

service charges shall be for the use of and shall be transmitted to the municipality in which

such property is located; provided, however, no service charge collected by the department

130

pursuant to such a provision shall be transmitted to the municipality for that portion of a

calendar year in which taxes have previously been paid by the department or by the

previous owner.

Remittance to Municipalities – At the end of each tax year for occupied units, the Bureau

of Technical Support Property Management Section shall compute the tax credit due any

municipality from the municipal services collected for each lease account in that

municipality. A separate invoice will be prepared for the amount collected for every lease

account in that municipality. In the body of the invoice the individual lease account number

with the Block and Lot number, if any, associated with that lease account will be detailed

along with the amount of In Lieu services collected, as well as what the leased area is used

for. The total of the amount of the Municipal Services In lieu of Taxes collected for the

lease account will be noted. The invoice shall indicate that the check will be delivered, and

not mailed direct, to ensure that the Department receives proper credit for the payment.

This invoice and a letter of explanation shall be forwarded to the tax collector for the

municipality and a copy kept in the master file for In Lieu for Municipal Service charges

file. If it is the first time a payment is being made to the municipality, a W-9 vendor ID

Questionnaire form will need to be sent along with the invoice. The invoice and the W-9,

if needed, shall be returned to Property Management Section of the Bureau of Technical

Support for processing. Once the invoice and W-9 has been returned, copies are made for

placement in the individual lease accounts that the tax In Lieu invoice is for, and a copy

will be placed in the master file and attached to the copy of the unsigned invoice in the

file. The Property Management Section will process the invoice to Project Funding together

with a copy of the lease and expense distribution form. A copy of the invoice and expense

distribution form to be processed will also be provided to the Closing Unit and a copy kept

with the Supervisor of the Property Management Section.

When Treasury has issued a check for the In Lieu of Municipal Services Payment, it will be

sent to the Department of Transportation Accounting Unit, which will notify the Funding

Unit of the Bureau of Technical Support to pick up the checks. The Project Funding Unit

representative will scan a copy of the check and record the receipt. It will then provide the

check to clerk of the Closing Section of the Closing Bureau for additional recording; the

clerk will then provide the check to the Funding Unit of the Bureau of Technical support for

recording and distribution.

The Property Management Section will record on each of the rental lease accounts in the

rental data base that the check is for:

1. The check number for the In Lieu of Municipal Services Payment

2. The amount of the check in the Notes section and a statement of the year for which

the payment is being made.

3. In the section noted as “Net” the amount of the check that is for the In Lieu of

Municipal Services for that lease account and it shall be put in parenthesis ( ) to

indicate a payment was made.

Once the check is recorded in the rental data base, it will be delivered or sent certified

return receipt mail along with a letter to the municipality explaining that the payment is

for In Lieu of Municipal Services that were collected on the lease accounts in the

municipality. The letter shall indicate the lease accounts, with associated Block and lot that

the money was collected. A copy of the entry of the In lieu of Services Payment on the

individual rental lease account will be printed out and kept in the lease account file, along

131

with a copy of the check that is mailed and the letter to the tax collector with the

explanation.

Credits on Federal Projects – Net proceeds from the lease or sale of real property acquired

with Federal assistance are to be retained for use on current or future federal projects. The

proceeds are deposited into NJDOT trust account for use in Title 23 USC eligible projects.

4.28 Taking Possession of Property

4.28.1 Possession Certificate Distribution

Possession of a property is to occur after the Department has paid for the acquisition of

the property and the property acquired has been vacated or if occupied all the occupants

in the acquired property are under lease with the State. Copies of the completed possession

certificate shall be distributed as follows:

 Owner(s)

 Municipal Tax Assessor sent certified mail

 The file

 Scanned to database

Prior to the acceptance of possession of an improved property, an inspection is to be made

to determine if the owner has complied with the terms of the agreement. If the owner has

complied, the realty specialist may issue Form RE-7, Certificate of Possession - Removal.

If the owner is to retain and remove a structure, the realty specialist shall inspect the

premises and consult the case file to determine which items of realty are to be retained by

the owner as a part of the agreement.

The offer letter indicates those items of realty and personalty to be conveyed as a part of

the real estate and is to be used as a reference when inspecting the premises. The realty

specialist shall inspect the premises, in the owner's or authorized agent’s presence, to

determine whether: the structure is vacant of personal property; the owner has removed

any part of the realty not authorized by the agreement, all public utilities are turned off.

At this time the realty specialist is to accept the keys for the dwelling, which are to be

retained in the District.

4.28.2 Pre Construction and Transfer of Keys & Documents

Pre-Construction Meeting – The District is responsible for ensuring that the keys, copies of

all the demo release letters and the possession certificates for the project are turned over

to the State’s resident engineer at the pre-construction meeting. A copy of all the

Agreements shall also be presented to the resident engineer with a notation for any special

arrangements that may have been reached and are part of the agreements.

Copies of any available judgments from the condemnation cases shall also be provided to

the resident engineer. No subleasing or assignment of lease is permitted without

permission.

4.28.3 Asbestos & Demolition for Properties that are Improved and Acquired

In nearly all circumstances, buildings or other structures on acquired right of way will be

demolished. In addition, buildings and/or structures on adjoining property damaged by the

right of way acquisition may also need to be demolished. The Division should incorporate

those costs into its cost estimate process. Demolitions are normally done as a standard

item in the main highway construction contract. However, sometimes an Advance

132

Demolition contract is required due to any number of factors where the building/structure

is found to present a clear hazard or liability which outweighs the additional costs of a

separate contract. It should not be entered into lightly since an individual demolition

contract represents a significant additional cost to NJDOT, and generally takes at least 6

months to complete if all goes well.

If an Advance Demolition contract is deemed necessary and requested, the requestor must

provide the funding and the associated job number. The requestor also arranges for the

assignment of a PM/RE to the project.

Capital Program Support (Bureau of Landscape Architecture & Environmental Solutions)

develops the Advance Demolition contract, and moves it from project inception, through

advertisement & bids, to project award. At that point (beginning of mobilization), the

assigned PM and/or RE in the field takes over the project through its completion.

Where any buildings will be demolished, the need for asbestos surveys should be

communicated with the Bureau of Landscape Architecture & Environmental Solutions

(BLAES) to allow for planning of asbestos survey contracts. These contracts are required

whether the demolition will be done later through the construction contract or as advanced

demolitions.

Once the necessary rights to demolish (or conduct an asbestos survey) have been obtained

by the Department, an asbestos survey will be requested from BLAES by the Realty

Specialist 4 for the project. Every effort should be made to have the asbestos surveys done

for the whole project at once, but when necessary the requests may be done in batches

as the properties become available. While it is preferred to have the dwelling owned and

vacant before requesting a survey, it is possible to request an asbestos survey if the owner

has signed a limited Right of Entry for the purpose of conducting the asbestos survey and

the occupants have agreed to permit the survey. The survey request will have to note that

the dwelling is occupied and any damage caused by the survey sampling will have to be

repaired.

Asbestos Surveying generates a report identifying the type, location and amount of

asbestos present, and the estimated cost for removal. This report is confidential and for

NJDOT use only. It is not used as the asbestos specification in contract documents.

Asbestos Abatement provides a specification to be added to a construction contract’s

Special Provisions, and this specification is part of the construction contract’s bid

advertisement documents. It tells a Contractor removing the asbestos exactly what to do

and how to do it. The Abatement task order also provides an on-site asbestos specialist

working on NJDOT’s behalf who oversees the Contractor’s asbestos removal operations,

performs related air-monitoring, and ensures proper disposal.

Both Surveying and Abatement costs are funded through agreements BLAES maintains.

The funding for asbestos removal may be funded as a right of way cost under demolition

operations, funded under an existing task order or paid under the asbestos removal

standard item in the main construction contract.

In instances where a project construction is more than a year off, it is recommended that

the Realty Specialist 4 coordinate with the project manager for the project to also request

advanced demolition of the structures. All utilities will need to have been removed from

the vacant buildings.

All asbestos and demolition requests are to be sent to the Manager of the Bureau of

Technical Support in Trenton, the Supervisor Property Management Section plus a copy

133

sent to the project manager for the project. All requests for surveys should be grouped

together based on the timing of the availability of the buildings. It is not cost effective or

efficient to do individual survey requests.

All asbestos surveys requested for buildings shall include the following information:

 Route & Section

 The type of Funding: Federal or State

 Job number

 Parcel numbers

 Street addressed for each parcel

 The date each parcel will be available for the asbestos inspection

 The type of dwelling, such as whether residential, commercial or industrial, the

number of stories high, the construction type, such as masonry block, wood, metal,

on a slap foundation or with a basement

For non-building structures, the request should include the above and also describe the

item to be inspected and indicate in red on the appropriate Right of Way plan sheets the

location of the structure with suspected asbestos.

Both types of asbestos requests will require that 2 copies of the General Property Parcel

Maps are included with the subject parcels and the buildings or structures on the parcels

outlined in RED on the maps.

All Advanced Building Demolition Requests shall occur either with or subsequent to the

asbestos request.

All demolition requests (contract or advanced) shall provide the following the information

as required for the Asbestos requests for buildings and include the following information

as to whether there is a:

 A basement, crawl space or slab foundation

 A septic and well or city water and sewer or a combination

 An underground storage tank with the approximate size in gallons

 Any specific items besides the dwelling, such as a garage, barn, out buildings or

shed that should be included in the demolition

 Any additional information pertaining to the demolition

If possible, the location of the well, septic, underground fuel tanks should be noted on the

two (2) General Property Parcel Maps. The request will also have one Entire Track Map.

The demolition information will be provided by the Realty Specialist 4 to BLAES for

advanced acquisitions and to the Project Manager for all regular contract demolitions. No

subleasing or assignment of lease is permitted without permission.

4.28.4 Utility Removal for Acquired Buildings

Once a building owned by the State is vacant, the realty specialist will arrange to have the

following done:

 Electric meter removed and the wires removed from the building

 Gas meter removed and the gas line cut at the curb

134

 Phone lines removed from the building

 Cable lines removed from the building

 Water shut off and the meter removed

 Sewer line capped

 Local municipal police department notified that the building is vacant and owned by

the State

 DOT Operations for that region contacted for the purpose of having the building

boarded up and secured (which is done after the meters have been removed from

the building)

 Coordinate with the Realty Specialist 4 for the asbestos survey and demolition

request

 Request wells be properly sealed, septic system closed, as part of the asbestos and

demolition request documentation.

Arrangements shall be made to periodically inspect the dwelling until the structure is

demolished. Once the dwelling is demolished, the municipality and police department

should be notified, the Certificate of Possession-Removal can be used for this purpose.

All utility companies are to be requested to send a demolition permitted letter with regard

to the removal of their meters and services from the dwelling. A demolition permit will

not be issued by the municipality until the State Contractor can produce demo release

letters from all the utility companies: electric, gas, phone, cable and water.

Although the realty specialist will arrange to have the water turned off and the water meter

removed, the contractor will be required to arrange for the cutting and capping of the

water and sewer line before the demolition will be permitted by the municipality. The demo

release letter will be kept with the possession certificate for the parcel that the release

letters were obtained. Note, in the event that the building contains a fire suppression

system, it may be necessary to maintain the water and heat (at a reduced level) until the

building is demolished. This scenario should be identified early to seek early demolition

where possible.

4.29 Eviction Activities,

If eviction is necessary in accordance with the eviction policy the following procedure will

also be adhered to. A residential or commercial occupant cannot be evicted from the

occupied premises until the occupant has been provided with a 90 day written notice to

vacate the premises and a 30 day notice to vacate the premises, which cannot have a date

that ends before the date in the 90 day notice. The 30 day notice to vacate is not sent until

the State has ownership of the property. In the case of a residential occupant, the 90 day

notice cannot be sent until comparable replacement housing has been provided to the

occupant. The transmittal of the 90 day notice to the occupant is not a sufficient basis for

the initiation of the eviction process. It is therefore imperative that we secure new leases

with the current owner/tenant occupants prior to accepting an agreement from the owner.

(See Acquisition, Section 3.14C for further discussion).

90/30 Day Notices to Lessees (See Section 4.6.6) - If any occupant doesn’t surrender

possession of the premises by the date prescribed in the 90/30 day letters, the District

Program Manager shall immediately request the Division of Law TC&C Section to initiate

an eviction action. The request for eviction must include all letters/memoranda in the case

135

file to support the case for eviction and the District must be able to show that the occupant

was provided with information regarding their relocation benefits, such as the notification

of any eligibility for relocation benefits, the amount if eligible for moving their personal

property, for residential occupants, the amount, if any, of their housing supplement and

at least one available comparable replacement dwelling and other related relocation

assistance.

4.30 Retention of Realty by Owner

Owners may be offered the opportunity to retain realty, for an appropriate price deduction.

If an owner wishes to retain an item(s), the realty specialist shall prepare A report on the

cost to retain. A retained item(s) is not eligible for moving cost reimbursement. The realty

specialist will have the same monetary limit on retention estimates as on administrative

settlements and the call data will document the basis for the estimate. Estimates in excess

of the agent’s limit, should be reviewed by a supervisor who shall make a written

endorsement on the retention estimate.

4.31 Property Management

The Right of Way & Access Management Division is responsible for the ownership functions

of NJDOT held lands, including leasing, placement of deed notices and conservation

restrictions and the sale of those lands. Other units may have operational control for day-

to-day use of the property as noted below.

In no case shall any unit of the Department other than the Division of Right of Way &

Access Management’s Property Management Section purchase, lease or commit any

existing Department lands for non-facility uses including exchanges, mitigation or

conservation use. Before any land is restricted, leased or sold, the Property Management

Section undertakes a Department review as set forth below to determine if there are any

other potential facility related uses for that land. Any unit wishing to sell, lease, grant

permission to use or restrict Department lands must work with the Division so that

alternative use is done legally and does not create future issues for the Department.

A. Right of Way Use Agreements

FHWA has changed the definition of “air rights” to fall under a broader category called

Right of Way Use Agreements. 23 CFR 710.105 defines Right of Way Use Agreements

as: conveyance of real property interests, defined by an agreement, as evidenced by

instruments such as a lease, license, or permit, for use of real property interests for

non-highway purposes where the use is in the public interest, consistent with the

continued operation, maintenance, and safety of the facility, and such use will not

impair the highway or interfere with the free and safe flow of traffic.

B. Use of Lands Held For Roads

The Right of Way & Access Management Division is responsible for providing

agreements approved by a DAG for any users of Department lands both inside of and

beyond the corridor, except for utility installations within the road corridor and driveway

related work within the road corridor.

Operations maintains physical control of those lands which are traditionally considered

part of a roadway corridor including the cartway, shoulders and the established clear

zone for that cartway, along with basins and other roadway facilities which fall outside

of the clear zone through the issuance of Highway Occupancy Permits.

136

The Major Access Bureau provides Highway Occupancy Permits for driveway use, except

on active projects where the Office of Access Design has authority to modify or revoke

Highway Occupancy Permits to conform driveways to the road project.

NJDOT lands which are subject to contamination related deed notices are overseen by

the Bureau of Landscape and Environmental Services

Monitoring wells and remediation activities, and other non-utility or non-driveway uses

within a corridor would thus need both a Highway Occupancy Permit and an Agreement

issued by the Right of Way & Access Management Division, while users outside of the

corridor would only have an agreement with the Division on non corridor right of way

lands.

C. Use of Lands Held for Other uses

Entities requesting to use lands for mitigation of severance damages or to fulfill NJDEP

permit requirements are dealt with through Right of Way & Access Management.

Alternative uses of non road facilities also require the permission of the unit which

occupies that facility (Operations for a maintenance yard, Maritime Resources for a

CDF, etc.).

Imposing Restrictions on Department Lands

The Division is responsible for putting in place any legal restrictions on lands owned by

the Department. That process requires that existing lands must be cleared to ensure

that they are not needed for the facility they serve. No unit may offer existing right of

way or lands as mitigation sites without first verifying through the Division that they

are no longer needed. Lands that are specifically purchased as part of a project for

mitigation are immediately available for use provided that they were acquired in a

location that would not impact other Department lands or facilities. Any conservation

or other similar restrictions must be specifically noted as such on the GPPM page that

they are shown on. Us of lands within a road corridor or facility must be cleared by

ROW&AM with all appropriate Department units and must take into account any future

needs of that facility.

A. Inventory

Lands bought as part of a project are not considered part of the Department land

inventory until after the project is completed and may be leased back to the occupant

as set forth below. Lands purchased specifically for mitigation, exchange or

conservation use as part of a project that are used for that purpose are also not

considered as inventory and may be used for their intended purpose without a clearance

review, so long as they are clearly not within the Desirable Typical Section or potential

use area of the facility/road. Mitigation lands should be identified as “M” parcels and

the permit that they are related to should be noted on the maps and in the inventory

as a permanent identification of their intended use and purpose.

Property that was purchased as a partial acquisition with the purchase of the damaged

remainder is shown on the GPPM as an “X” Parcel, indicating it was not specifically

needed by the project and is known by convention as an excess parcel. It is not

however excess in terms of potential lease or sale until officially declared as such by

the Commissioner. Parcels which are to be sold as excess are typically shown on the

maps as “VX” parcels.

137

Upon completion of a construction project, all potentially excess parcels will be

identified and the information shall be entered into the database, and where possible

the Block and Lot shall be noted. The project managers shall notify the Supervisor of

the Property Management Section that the construction project is complete and shall

confirm those parcels that were not or are no longer needed by the current project. P.L.

1997, c.4 requires the Department to annually prepare an inventory of lands owned by

the State and held for transportation projects which are not under construction. The

inventory is to be submitted to the Governor and Legislature yearly.

The database will be maintained to include lands identified as potentially excess and

excess land requests from entities outside of the Department. Each realty specialist

assigned an excess land request will be required to maintain a file for the requested

land and to update the excess land database on each parcel requested.

The Department is not obligated to sell remnants where the transaction costs approach

or exceed the value of the requested property.

4.31.1 Inventory

Lands bought as part of a project are not considered part of the Department surplus land

inventory until after the project is completed. Lands purchased specifically for mitigation,

exchange or conservation use as part of a project that are used for that purpose are also

not considered as inventory and may be used for their intended purpose without a

clearance review, so long as they are clearly not within the Desirable Typical Section or

potential use area of the facility/road. Mitigation lands should be identified as “M” parcels

and the permit that they are related to should be noted on the maps and in the inventory

as a permanent identification of their intended use and purpose. Since the Department’s

land needs are always changing as new mitigation requirements are imposed, any earlier

determination regarding Department owned lands and improvements as excess or surplus

is subject to reclassification at any time.

4.31.2 Departmental Clearance of Excess Lands Process

The Department’s needs for land are always changing, therefore any determination

regarding Department owned lands and improvements as excess or surplus is subject to

reclassification at any time.

A. The excess land clearance process begins when the Property Management Section of

the Bureau of Technical Support receives a request regarding the availability of land or

improvements owned by the Department for the purpose of being made available for

sale or lease. The request is logged in the “Excess Land Received” book according to

the month the request was received and the requestor is notified that the request was

received and is waiting processing. The Supervisor for the Property Management

Section will be responsible for assigning the request to a realty specialist of the unit.

Once the request has been assigned, the area that the requestor is interested in will be

verified by the realty specialist. If needed the realty specialist will send a copy of the

General Property Parcel Map with the area to be circulated to the requestor with a

request to confirm that the area mark for circulation is indeed the area being requested.

Once verified, the realty specialist will confirm that the Department purchased the

property and that the property wasn’t sold. The realty specialist will also determine

how much the department paid for the property. If the Department is still the owner,

then the realty specialist will circulate the area to see if the property can be declared

as excess and available for sale as surplus property or if it can be leased. At this time

the realty specialist will notify the requestor that the Department does or doesn’t own

138

the property and if it is owned that a circulation will be started to determine if the

property being requested can be made available for sale or lease.

Each circulation will contain the following:

1. A transmittal memorandum requesting review of the property

2. A tax map or project map with the area being requested highlighted

3. A straight line diagram with the location of the area being requested marked

4. A copy of General Parcel Property Map of how the Department acquired the area

with the area being requested outlined in red

5. A copy of the most recent construction map for the area being requested

6. A copy of the requestor letter or application, or request from Department unit.

B. A transmittal memorandum includes the Route, Section, Parcel designation of how we

acquired the parcel, as well as the current highway designation, the approximate mile

post, the size of the property being requested, the municipality and county with the

block and lot designation, if available, of where it is located. If the lot is not available,

use the adjoining lot and note that it is adjoining. The circulation transmittal

memorandum should also stipulate what the intended use is for the property as well as

the name of the requestor and should request that the reviewing units stipulate any

concerns or restrictions, if any, for release of the property for sale or lease.

Each request must be circulated to the following review units at the Department:

1. Statewide Planning

2. Division of Environmental Resources

3. Major Access

4. Jurisdictional

5. Landscape

6. Drainage

7. Environmental Solutions (E-team)

8. Park & Ride if over an acre in size

9. Facilities Planning & Engineering if over two acres in size

10.CPM Program Manager

11.Regional Operations Director

12. Permits (Where Applicable)

13.Utility Management (if Utility involvement)

C. For disposal of federally funded excess real property, 23 CFR 710.409 (b) provides that

Federal, State, and local agencies shall be afforded the opportunity to acquire excess

real property when such real property has a potential use for parks, conservation,

recreation. This would take effect after the local and county government units have

had an opportunity to purchase, after which the other government entities will be

notified of the excess land. The NJDOT will determine what lands fit this criteria.

139

D. At times it may be necessary to circulate the request directly to New Jersey Transit or

to another Agency in accordance with federal requirements. With regard to Transit, if

the property is near a rail line or existing Transit property or if the property is an acre

or more in size, then Transit will be given an opportunity to respond.

E. Any of the reviewing units may determine that there is a current or possible future need

for the property and recommend that the Department retain the property. Any of the

reviewing units may okay the release of the property as excess and available for sale

as surplus property but with restrictions that must be adhered to with the sale. All the

restrictions must be in any eventual agreement of sale and on the deed. For those sales

that are for a public use, the agreement of sale and deed must have a reversionary

clause, which state that if the property is not used for the stated public use, the land

reverts back to the State, except for those sales that are intended for public use that is

redevelopment.

F. The Supervisor of the Relocation & Property Management Section oversees the

circulation of all requests for Department owned lands to be made available for sale or

lease.

Once the Relocation & Property Management Section receives clearance from all the

appropriate reviewing units in the Department, the realty specialist will need to request

from the Project Funding Unit of the Bureau of Technical Support as to how the property

was acquired with regard to whether State, Federal or another State Agency’s, funding

was used. This information is needed for any eventual Department Actions and deposits

of proceeds from any eventual sale or lease. If the funding source used to acquire the

Right of Way was Federal Funding, then the Section F applies.

G. FHWA approval shall be secured prior to disposal of lands on an Interstate project.

Disposal of lands acquired with federal funds which are not on an Interstate roadway

does not require FHWA review or concurrence as long as the land is sold or leased for

fair market value (23 CFR § 710.403). FHWA concurrence is needed for a sale or lease

for a public purpose where the proposed transfer will be for less than fair market value.

Funds obtained from the sale of lands purchased with FHWA funds must be credited to

an account for use on other federally funded projects and cannot be used for any other

purpose.

H. After the funding source has been determined, the realty specialist will request that

ROW Engineering prepare a description and have a map drawn with a VX designation

for the property that has been declared as surplus. ROW Engineering shall be provided

with the request memo, a copy of the GPPM of how the property was acquired, the

latest GPPM, an aerial overview and any additional information that may be available.

Once the realty specialist receives the VX map and description, the realty specialist is

to send by certified return receipt requested, the parcel map showing the available VX

parcel to the municipality and the county where the property is located, informing each

that the Department is in the process of conveying its interest in the property and

asking if the municipality (or county) would be interested in purchasing the property

for a public use or if there are any concerns regarding the potential transaction. In

instances where the Department is only proposing to lease the property, there will be

no legal description or VX designation requested from ROW engineering and the letters

to the county and municipality will state that the area marked on the provided map is

being considered for lease by the Department and asking if either the county or

municipality interested in leasing the property for a public use. The letters to the

140

municipality and the county will provide those entities with a 30 business day deadline

for a response.

I. If the realty specialist receives a response from the municipality or county indicating

that they have an interest in purchasing the property for a public use, the realty

specialist will then coordinate with Technical Support Bureau or District staff to

determine the amount of the acquisition price paid for the parcel attributed to the

portion of that parcel not used for a roadway and that is available to be conveyed for

public use. In cases where the public use is intended for redevelopment, then an

appraisal will be done to determine the Fair Market Value of the property to be

conveyed. If the proposed sale (or lease) is small enough that the lease or purchase

price is below $5,000, the NJDOT may utilize an ADV as an alternative to a full

appraisal. It should be noted that at no time, except for transfers for use as a public

roadway, shall a transfer of land to the municipality or county be for less than the

acquisition cost paid by NJDOT. Federally funded lands must transfer for at least the

Fair Market Value except where FHWA approves a lower value such as for a park.

Acquisition cost is not required when the property was specifically acquired for

mitigation purposes and after being deed restricted is transferred to a local government

or state agency for caretaking of the deed restricted property. For those instances

where the Department is only able to lease the property and the county or municipality

is interested in leasing the property for a public use other than for redevelopment, the

rental value may be a nominal amount, as approved by the Director. Once the value

has been determined and reviewed (except for ADVs), three copies of the agreement

of sale contract or lease will be prepared and sent to the municipality or county for

acceptance. The municipality will provide the Department with a copy of the ordinance

and resolution, the county will only need a resolution, authorizing the sale or lease. In

cases of the public use being intended as redevelopment, the municipality or county

will need to have an approved redevelopment plan. The Property Management Section

will prepare a Department Action to have the sale presented to the State House

Commission for its approval. In addition the Property Management Unit will need a

resolution from the governing body agreeing to the purchase price of the property,

which is based on Fair Market Value, and which will be part of the packet presented to

the State House Commission.

Once the realty specialist receives the signed contracts, resolution, and ordinance, if

needed, a department action will be prepared to have the contracts of sale executed,

and a deed prepared and sent for recording upon receipt of the payment in full of the

purchase price. In cases of sales where the public use is for redevelopment, the

Department Action will need to state the date that the State House Commission

Approval was granted for the transaction. The purchase price, the name of the

purchaser and the size of the property should be noted on the Department action. A

copy of the approved department action will be kept in the case file and one in the

supervisor surplus property sold file. Two copies of the executed contracts and the

approved department action will be kept in the case file for the property. A copy of the

executed agreement of sale contract will be sent to the municipality or county with a

request for a check to cover the purchase price. Upon receipt of the certified check, the

realty specialist will prepare a deposit slip and take the check to NJDOT cashier. A copy

of the deposit slip and deposit receipt from the cashier will be kept in the case file and

the Supervisor surplus property sold file. No State House Commission Approval is

needed for sales or leases to the municipality, county or other governmental body for

141

public use, except in cases where the public use is intended for redevelopment that

State House Commission Approval is required.

If after 30 business days the county and municipality do not respond or respond that

they are not interested, then the realty specialist can request that an appraisal be

obtained. This appraisal will, when completed, be reviewed by one of NJDOT reviewers.

If the reviewer determines that the report is inaccurate or incomplete, they will work

with the appraiser to have the report deficiencies addressed. In cases where the

reviewer and the appraiser cannot resolve their differences, the reviewer can stipulate

its findings and register an amount that differs from the appraiser’s amount. In cases

where the reviewer finds no faults with the appraisal submitted, it will register that

value.

For low value excess land, an Administrative Determination of Value, providing relevant

sales and an explanation of the valuation may be substituted for an appraisal. This

substitute for an appraisal is limited to transactions where the value of the surplus land

as an entity or assemblage would be less than $5,000 or such other approved amount,

and is intended to avoid uneconomic transactions caused by the payment of substantial

appraisal fees to appraise with nominal value property.

No person who performs an appraisal or an Administrative Determination of Value for

an excess or surplus parcel is permitted to negotiate or set value for that parcel. A

review appraiser who approves the appraisal or Administrative Determination of value

is prohibited from negotiating for the parcel.

J. If the property is to be sold, and is developable then the appraisal of the property will

be for the fair market value of the land as a standalone and as if assembled to the

adjoining property which would provide the highest value. If the land is not a buildable

lot, then only assemblage value will be sought. The assemblage will be considered to

that adjoining lot which would provide the highest value. All appraisals will be reviewed

and registered. Where authorized, the cost of any appraisal may be added to the fair

market value when determining the final sale price for a direct sale or starting bid for

an auction. For land that will be sold at auction, the advertisement and auction fee

associated with the auction of the property may be added to the fair market value and

would be the starting minimum bid price at the auction.

If the property is only to be leased, a fair market rental value based upon stand alone

or assemblage use will be determined by an appraiser unless an ADV is used for a

nominal transaction. Except for ADVs, all rental appraisals will be reviewed.

An “Enhancement Value or Assemblage Value” is defined as the amount by which the

value of a property is increased (if at all) through assemblage of another property into

the same ownership. This is accomplished by valuing the Departments excess surplus

land and the adjoining property as if they were assembled together and then valuing

the adjoining property alone. The difference between the two is the enhancement value.

The Department may use the adjoining property which creates the highest potential

value in appraising the site, and may also consider any special interest or need that the

requestor has, such as needing land for development.

K. For those excess lands owned by the Department for less than 10 years, the Reality

Specialist will need to contact the owner that the Department acquired the property

from in order to offer the original owner an opportunity to purchase the property at

today’s fair market value through a direct sale. In cases where the Department is

conveying the property to another government agency, municipality or county for a

142

public use, the previous owner is not contacted or afforded the opportunity to acquire

the excess property. The Reality Specialist working with the Supervisor of the Property

Management Section will follow the requirements in N.J.S.A. 52:31-1.4 in attempting

to contact the previous owner.

If the previous owner has no interest or the Department has not received a response

from the previous owner within the period of time established by the State treasurer,

the previous owner’s right to repurchase the interest before it is disposed of shall

expire.

When the previous owner expresses an interest to repurchase the excess property, an

Agreement of sale contract will be drafted and three copies sent to the previous owner.

All three copies of contract will need to be signed and returned to the Property

Management Section. This sale will be subject to the State House Commission

Approval.

L. If the excess property has been owned by the Department for 10 years or more, is not

a buildable lot and the requestor property is the only adjoining property, the Reality

Specialist can contact the requestor with the potential purchase price, but only after

the municipality and county have been contacted and provided an opportunity to

purchase the excess surplus land for a public use. If neither the county nor the

municipality is interested in purchasing the property for a public use, then the realty

specialist can contact the requestor with the purchase price. If the requestor is still

interested, then 3 copies of the Agreement of sale contract will be drafted for a direct

sale to the requestor and sent by certified mail to the requestor. The requestor will

need to return all three contracts signed, to the Property Management Section as well

as a copy of a resolution for cases where the adjoining owner is a corporation and the

operating agreement for an LLC. This sale will be subject to the State House

Commission approval.

If there are other properties besides the requestor’s property adjoining the excess

property, but the property is not buildable, a direct sale to the requestor may be

possible but the other adjoining property owners will need to be sent a letter informing

them of the potential sale. If the Property Management Section doesn’t receive a

response from the adjoining owner(s) within 30 business days, the property may be

sold to the requestor. If any adjoining owner expresses an interest, then the excess

property will need to be sold at auction. The sale by auction will require State House

Commission Approval. If the excess property has only one adjoining owner, or only one

interested adjoining owner and is not buildable, a public auction is not required and a

direct sale can proceed after State House Commission Approval has been received.

For those excess properties that are buildable, or have more than one adjoining

property owner interested in acquiring the property, an auction will be required and the

sale by auction will require State House Commission approval before an auction date is

set. A Department Action is required to be prepared and executed to have an item put

before the State House Commission.

M. Once State House Commission Approval has been received for the Department to

proceed with a direct sale, the realty specialist will prepare a department action to have

the contracts of sale executed and a deed prepared and sent for recording after receipt

by the Department of the consideration. The purchase price, the purchaser name, the

date the State House Commission approval was given and the size of the property

should be noted in the Department action. Once the contracts have been executed, one

143

copy of the executed contract of sale will be sent to the requestor with a request for

the consideration and direction that the check shall be made out to NJDOT. Upon receipt

of the full consideration, the realty specialist will prepare a deposit slip for depositing

the consideration with NJDOT Cashier. A copy of the deposit slip, check and cashier

receipt will be kept in the case file and in the Supervisor’s excess property sold file, as

well as a copy provided to the Project Funding Unit. After the Department Action is

approved and full consideration of the purchase price has been received by the Property

Management Unit, the Realty Specialist Supervisor will prepare a memo to have the

deed prepared and recorded and will submit the memo along with the file to the Closing

Bureau’s Title section. The Title Section Unit will prepare a deed as well as a request to

have the deed executed and will send the deed for recording.

In some cases the requestor for a direct sale may request a closing, in those cases a

deed will be prepared and executed but not recorded. The deed will be brought to the

closing and exchanged for the consideration and a transmittal letter from the

buyer/requestor to the county where the property is located, requesting that the deed

be recorded. The buyer is requested to send a copy of the recorded deed to the Property

Management Unit upon receipt of the recorded deed. The memo to the Title Unit will

state that there is a closing and that consideration has not been received, but to

prepare and execute the deed, but not to send the deed for recording.

N. For the excess property sales that do require an auction, the Reality Specialist will follow

the procedures outlined in Public Auction Process and in accordance with Auction

Requirements.

O. For those sales requiring State House Commission Approval, the Reality Specialist will

prepare the packet for the State House Commission review. The packet will be given to

the Supervisor who will be responsible for preparing a transmittal memorandum to the

office of Real Property Management of the Department of Treasury listing all those

packets being presented for State House Commission review and approval.

State House Commission review packets must contain the following information:

1. State of New Jersey Asset Disposition Form

2. Case Memorandum

3. Approved Department Action requesting the conveyance of the State’s interest

4. Certification of value letter and the Property Description section of the Appraisal

5. Appraisal Review Memorandum

6. General Property Parcel Map (GPPM) with the property in question highlighted

7. Description of the Property, where applicable

8. A copy of the tax map and aerial view of the property, if available

9. The requestor letter with the intended use for the property stipulated by the

requestor, including the current activity of the requestor on the adjoining property

as well as the city and State where the individuals live who are the Buyer or Lessee,

where applicable

10.A State House Commission Disclosure form from each member of the Buyer or

Lessee, where applicable

144

Each case submitted for State House Commission Review shall have 16 collated packets

with all documents in the packet having a three hole punched along the side.

P. The Supervisor of the Property Management Section of Bureau of Technical Support

shall establish and maintain an inventory of parcels of properties declared excess and

available for sale. A list of properties identified as potentially surplus but not declared

available for sale as excess property will also be maintained as they are identified.

Property owned by the Department that is not used as part of the facility for which it

was purchased is either surplus or potentially excess land or it is confirmed excess land,

which is officially declared as unneeded for the facility and available for sale or lease.

When surplus or excess land is needed for active projects to use for mitigation or as an

exchange, the Unit (Project Management, Office of Access Design, E-Team, etc.) which

wants to use that property wills request clearance from the Division of ROW&AM. A

circulation packet to determine if the property can be declared excess and used for the

proposed purpose will be prepared and circulated for review and comment by the

Division of ROW&AM. If there are no objections or comments by the reviewing units,

the surplus property will be cleared for use as part of the project. State House

Commission Approval will not be sought. The exchange or mitigation will need to be

verified that it is economically appropriate to use for mitigation or as an exchange to

ensure that the use of the excess land results in the Department receiving the value of

the excess land.

Q. The release of deed restrictions or easement rights held by the Department will likewise

be circulated for clearance and valued in accordance with the provisions for sale or

lease of Department property set forth herein.

4.31.3 Surplus Property

Includes property outside of the typical corridor width that has never been circulated,

property that has been circulated but was determined to be retained for possible future

use by the Department, property that was approved to be leased but not sold as excess,

and property that was approved as excess but now is required to be reviewed again. Any

excess property that was circulated and declared as excess and available for sale but was

done over two years ago, will need to be reviewed again and circulated to determine that

the property is still available for sale.

In exchanges of land as part consideration for a parcel under negotiations, the appraisal

report shall reflect any enhancement to the owner's remaining property and consider any

compensable severance damages which may be mitigated. Current fair market value or

rent shall be charged for the use or disposal of real property interests, including access

control, if the property interests were obtained with Title 23 USC funding. Exceptions to

the general requirement for charging fair market value may be approved when the

Department shows that an exception is in the overall public interest for social,

environmental, or economic purposes.

4.31.4 Excess Land

Those lands which have been cleared and declared to be excess to current or anticipated

future needs. Sale or Lease may be subject to State House Commission approval.

4.31.5 Excess Land File

Each excess land request file shall contain the original request, the acknowledgement of

the receipt of the request and the acknowledgement that the request review process has

started, the review circulation packet with copies of the transmittal memorandums to each

145

review unit, the review circulation responses (kept in a separate folder in the file), the

appraisal and review (if any), all correspondences with the requestor, the letters to the

municipality and county with the certified return receipt notices, the State House Packet

(if it was needed), the approved department actions, a copy of any signed contract of sale

or lease, a copy of any payments and the deposit slip and receipt, as well as call data which

shall track the interactions that occurred on the case. Future requests will be kept in the

PAECETrak excess land system.

4.31.6 Statutes and Regulations Related to Excess Land

There are a number of State statutes that pertain to the sale, lease or conveyance of any

or all of the State’s interest in real property, land and or improvements by the Department.

The following are a list of the most relevant ones:

A. N.J.S.A. 27:12-1 Disposition of property not needed for public use – When real estate

or any right or interest therein has or shall come into the possession or control of the

Commissioner, or when he has or shall have taken real estate or any right or interest

therein, in the name of the State for the use of the State in the improvement,

betterment, reconstruction or maintenance of a State Highway, and the Commissioner

has or shall have determined that the property so acquired is no longer required for

such use, he may:

1. Sell at private sale, for not less than the amount paid therefore by the State, to any

municipality corporation or to any public board or commission, for public use only;

provided, however, that the State Highway Commission is empowered to convey

upon such terms as he may deem proper to any municipal corporation or to any

public board or commission for road and bridge purposes only any lands acquired

by the State of New Jersey for road and bridge purposes:

2. Lease to any municipal corporation or to any public board or commission, for public

use only:

3. Sell at public sale to the highest bidder: and

4. Exchange for other lands

All or any portion of such real estate or any interest therein, with or without

improvements thereon, including the hereditaments, appurtenances, easements and

right of way, and make the necessary conveyance of the same.

Under 23 CFR 710.409 (b) Disposal of excess real property. Federal, State, and local

agencies shall be afforded the opportunity to acquire excess real property considered

for disposal when such real property interests have potential use for parks,

conservation, recreation, or related purposes, and when such a transfer is allowed by

State law. When this potential exists, the grantee shall notify the appropriate agencies

of its intentions to dispose of the real property interests determined to be excess.

B. N.J.S.A. 27:12-1.1 Sale of State Highway Property, first offer – Notwithstanding the

provisions of N.J.S.A. 27:12-1 or any other law to the contrary, if the Commissioner of

Transportation determines, pursuant to R.S. 27:12-1, that real property acquired for

the use of the State in the improvement, betterment, or maintenance of a State

highway is no longer required for such use, the Commissioner shall first offer to sell

such property or any right or interest therein at private sale (also known as a direct

sale) to the owner of the real property whose frontage is contiguous to the real property

being sold; provided that the property being sold is less than the minimum size required

for development under the municipal zoning ordinance of the municipality in which the

146

property is located and is without any capital improvement thereon; except that when

there is more than one owner with real property whose frontage is contiguous thereto,

the property shall be sold to the highest bidder from among all such owners. Any such

sale shall be for not less than fair market value of the real property.

C. N.J.S.A. 27:12-1.2 Conditions of sale – The sale of real property permitted by N.J.S.A.

27:12-1.1 may only occur after the owner of record at the time of the acquisition has

been notified and provided the right to repurchase their interest pursuant to N.J.S.A.

52:31-1.4 (Right of first refusal for when the Department owns the land and or

improvements for less than 10 years).

D. N.J.S.A. 27:12-2 Disposition of slopes or easements – The Commissioner may also,

when he (she) shall determine that certain slope, drainage or easement rights or any

or all of them, or parts thereof, are no longer required or necessary for the use of the

State highway with which they are connected, convey, grant, bargain, sell and release

to the owners of the fee, any slope, drainage, or easement rights, or any or all of them,

or parts thereof, including without limitation those easement rights or parts thereof

which give the State the right to enter upon lands adjoining any State highway for the

purpose of cleaning, straightening, widening, deepening and maintaining existing

ditches and streams and the right to discharge water and maintain a flow of water over

such lands adjoining the right of way of a state highway

E. N.J.S.A. 27:12-4 Sale or Exchange of unused lands (for the purpose of acquiring other

lands required for highway purposes) - When the Commissioner shall determine that

land, the fee to which he has acquired or shall acquire in the name of the State, are no

longer required for highway purposes, he may exchange or sell at private sale and

convey said highway lands for the purpose of acquiring other lands required for highway

purposes.

F. N.J.S.A. 27:7-21.4. Leasing property acquired for transportation purposes; provision

for termination of lease - Any real or personal property heretofore or hereafter acquired

by the Department of Transportation for a transportation or transportation related

program or project may be leased by the Commissioner of Transportation to any person

or public body or agency on a temporary basis. The commissioner shall include a

provision in the lease which would allow the termination of the lease upon written notice

thereof to the lessee prior to the conclusion of the term of the lease in accordance with

a minimum period of time for that notice, such provision having been the subject of

negotiation between the commissioner and the prospective lessee, so as to ensure that

the occupancy of the property does not in any manner interfere with or delay the

transportation program or project for which the property is needed. No person,

public body or agency shall remain in possession of premises beyond the conclusion of

the term of the lease or, in the case of a notice of termination, the date fixed by the

commissioner in the notice. If the lessee remains past conclusion of the term of the

lease or beyond the date fixed in the notice of termination, the department may

institute a summary proceeding in the Superior Court, for an order to show cause as

to why the department should not be granted immediate possession of the leased

property and the property be vacated of its occupants.

G. .J.S.A. 52:31-1.1 Sale, conveyance of State’s interest; terms; conditions; public

hearings; proceeds – The head or principal executive of any State Department, with

written approval of the Governor, is hereby authorized to sell and convey all or any part

of the State’s interest in any real property and the improvements thereon held by the

department or to grant an easement in or across such property if he shall find that his

147

department does not require such property or interest for any public purpose and that

such sale is in the best interests of the State or that a grant of such easement is in the

best interest of the State.

The sale or grant shall be upon such terms and conditions as the State House

Commission determine to be in the best interests of the State and shall be by public

auction to the highest bidder unless the commission shall otherwise direct.

In the case of lands subject to the provisions of P.L.1993, c.38 (C.13:1D-51 et al.), the

State House Commission shall conduct a public hearing at least 90 days in advance of

determining the terms and conditions of the sale or conveyance. In addition to any

other applicable requirements of law, rule, or regulation concerning notice for public

hearings, the State House Commission shall provide notice of the public hearing at least

30 days in advance of the date of the hearing in the same manner and according to the

same procedures prescribed for the Department of Environmental Protection pursuant

to sections 3 and 4 of P.L.1993, c.38 (C.13:1D-53 and C.13:1D-54). Any meeting at

which the State House Commission is to determine the terms and conditions of the sale

or conveyance or to decide to approve or disapprove a conveyance of lands subject to

provisions of P.L.1993, c.38 (C.13:1D-51 et al.) shall be open to the public, and the

commission shall provide public notice of any such meeting at least 30 days prior

thereto.

The proceeds from the sale of any property or interest in property sold pursuant to the

provisions of this section or from the grant or an easement shall be paid into the General

Treasury of the State, except, in the cases of land subject to the provisions of P.L.1993,

c.38 (C.13:1D-51 et al.), the proceeds shall be deposited, appropriated, and utilized as

prescribed pursuant to section 7 of P.L.1993, c.38 (C.13:1D-57).

H. N.J.S.A. 52:31-1.3 Application, Construction of Act – The provisions of this act shall

apply to real property or interests therein that have a value of $500,000 or less and to

easements that have a value of $100,000 or less. The provisions of this act shall be

deemed to be additional and supplemental to any existing authority to sell property of

the State and shall not be deemed to be in derogation of such existing authority.

Nothing in this act, P.L. 1962, c.220 (.52:31-1.1 et seq.) as amended and

supplemented, shall be construed to affect, amend, alter or repeal any provision of any

other law relating to the disposition of public lands for recreation and conservation,

farmland preservation, or any other public purpose.

I. N.J.S.A. 52:31-1.3a Approval of State House Commission required for sale, conveyance

of real property and exceptions - the sale or conveyance by the head or principal

executive of any State department of all or any part of the State’s interest in any real

property and the improvements thereon or the grant of an easement in or across such

property shall require the approval of the State House Commission without regard to

value of the property or easement or to the means by which the property was acquired

by the State, unless the sale or conveyance or grant is a disposition of public lands for

recreation and conservation, farmland preservation, or any other public purpose.

J. N.J.S.A. 52:31-1.4 Right of First Refusal – In instances where the State wishes to

dispose of a parcel of land or improvement which has been declared as excess and

available for sale or any interest therein, but the State has not yet owned the property

for ten years, the Department must notify and provide the owners of record of the

property at the time of the acquisition the right to repurchase their interest at the

current fair market value of that interest, as assembled to the formers owner’s property

148

(if any). The State shall notify the previous owner of record by certified mail to the

most current address of record of that owner and by public notice in two newspaper of

general circulation in the area wherein the land is located. The State Treasurer shall

have the authority, through rules and regulations, to establish the period of time by

which the previous owner of record must respond, following receipt of notice to the

most current address of record for that owner. If the previous owner of record does not

respond within the period of time established by the State Treasurer, the previous

owner’s right to repurchase the interest before it is disposed of at public auction shall

expire. A record of all efforts to locate the previous owner will be documented by the

Property Management Realty Specialist and kept in the excess land file. The owner of

record shall not include the heirs or devisees of the owner of record.

K. N.J.S.A. 52:31-1.8 Notification to the Municipality of State’s Determination to Sell or

Convey interest in Real Property - requires that the Department provide a certified mail

notification, (return receipt requested) to the Clerk of the Municipality informing them

of our intention to sell a property owned by the Department. The written notice shall

be sent, by Property Management Section of the Bureau of Technical Support, at least

14 days prior to any further action by the Department in order to permit a municipal

review and formulation of a response.

The Property Management Section will also notify the county clerk via certified mail

(return receipt requested) to inform the county of the Department’s intention to sell

the excess property, subject to the State House Commission Approval. In the letter to

the county and municipality where the property is located, both will be asked if they

have any interest in acquiring the property for public use or if they have any objections

to the State going ahead with seeking the State House Commission approval for the

sale. In instances where either the municipality or county express an interest to

purchase the property for public use only (N.J.S.A. 27:12-1.a) the Department may sell

to either entity at private and direct sale, for not less than the amount originally paid

by the State, except where federally funded.

Sales in this category to any municipal corporation or to any public board or commission

are for public use only and State House Commission approval is not needed.

Department of Treasury Real Property Bureau - The Bureau of Technical Support

Manager or designee shall provide the Real Property Bureau with the packet for the

State House Commission, and they may indicate an interest for other state use based

on that submission.

4.31.7 Public Auctions and Excess Land

Buildings and other improvements may be offered for sale, but not subsequent to the

authorization date for advertising a construction contract. Retention estimates may serve

as a basis for establishing the minimum bid.

A. Auction Requirements for Buildings and Other Improvements

All buildings shall be posted with a sign informing the public that the building and or

improvements are for sale and the Department is having an auction on a stated specific

date. The posting shall contain a telephone number that may be called to obtain

information regarding the sale. The notice of the auction, the terms and conditions of

the sale, and the process to inspect the building and or improvements shall be

presented to the Clerk of the municipality where the building or improvements are

located for posting on the town’s public notice board, as well as with the county sheriff’s

department where the property is located for posting where their sale notices are

149

posted (N.J.S.A. 2A:61-1). A Publication of a legal notice shall appear in 2 newspapers

of general circulation in the county where the building or improvement is located and

shall be published 4 times, once per week in 4 consecutive weeks prior to auction. The

notice shall identify the building and or improvements, list the terms and conditions of

the sale and the process to be followed to inspect the building and or improvements.

No Auction shall occur until proof of advertising has been secured by the Department

from the papers. The advertising notice is submitted to the Department Secretary, who

is responsible for advertising the auction in the newspapers.

B. For Land

All excess land that is declared as surplus property and that is required by law to be

sold at auction must be posted with a sign informing the public that the land is available

for sale and the Department is having an auction to sell the land on a stated specific

date.

The posting shall contain a telephone number that may be called to obtain information

regarding the sale. A notice of the auction shall also be presented to the Clerk of the

municipality where the land is located for posting on the town’s public notice board, as

well as with the county sheriff’s department where the property is located for posting

where their sale notices are posted (N.J.S.A. 2A:61-1). In addition a Publication of a

legal notice of the auction shall appear in 2 newspapers of general circulation in the

county where the land is located and shall be published 4 times, once per week in 4

consecutive weeks prior to auction. The notice shall identify the location of the land, a

description of the land being auctioned for sale, and provide an internet address where

the terms and conditions of the sale, the date, time and place of the auction. The

advertising notice is submitted to the Closing Bureau, which is responsible for

advertising the auction in the newspapers.

The posting of the property and the deliverance of the auction information to the

municipal clerk and county sheriff’s office shall occur no less than three weeks before

the auction date.

All inquiries into an auction will be noted on an auction inquiry log and all relevant

information regarding the auction will be sent to the interested party.

Excess Land declared as surplus property must have gone through the excess land

clearance process. In disposing of surplus property, the Property Management Section

must adhere to the requirements as set forth in the State Statutes and where required

State House Commission approval must have been obtained.

State House Commission Approval is needed for the sale, lease or the conveyance of

all or any part of the State’s interest in any real property and the improvements with

the following exceptions:

1. Conveyance of property to a municipality for a public purpose (N.J.S.A. 27:12-1.3a)

that is not intended for redevelopment;

2. Conveyance of a property to a municipal subdivision (e.g., a utilities authority-

notice to municipality should indicate a finding of public purpose - N.J.S.A. 27:12-

1.3a);

3. Conveyances of property in exchange for property we require for transportation

purposes (notice to municipality shall cite N.J.S.A. 27:12-4);

150

4. Conveyances of property for environmental, farmland preservation, recreation and

conservation, or any other public purpose. (notice to municipality shall indicate a

finding of public purpose).

All excess property disposals will be accomplished in accordance with 23 CFR 710

Subpart D, including FHWA approval when required.

4.31.8 Public Auction Process

Sales of buildings or excess land shall be accomplished by means of public auction except

for sales to governmental agencies for public use. Any interested State employee wishing

to participate in an auction must notify the Property Management Section at least 7 days

in advance of the auction of the desire to participate in the auction so that a DAG can be

present at the auction.

Auctions shall normally be via an approved internet site, but if that method is unavailable

and an in person auction is approved by the State House Commission, they may be

conducted in a designated conference room of the E & O Building of the New Jersey

Department of Transportation located at 1035 Parkway Avenue in Ewing, New Jersey or

when necessary a building maintained by the Transportation Department. If the sale is

conducted elsewhere, prior concurrence of the Manager of the Bureau of Technical Support

will be required. If an auction is conducted in person, the following conditions will apply.

The Manager of the Bureau of Technical Support, or designee, shall be the Presiding Officer

and members of Technical Support shall serve as auctioneer, registrar and cashier. The

Office of the Inspector General shall be notified at least 24 hours in advance of the auction,

in cases where a State employee intends to bid on excess land property.

The Registrar shall secure the name and signatures of all persons admitted to the auction,

as well as a separate sign in for each potential bidder. Each bidder will be required to show

identification, such as a driver license. The Registrar shall furnish each prospective bidder

with a copy of the public advertisement and the supplements, which include the conditions

of sale, copy of the standard agreement or lease, a bidder number and an

acknowledgement letter, which each bidder must sign and return to the Registrar. Any

person bidding on behalf of a Corporation will need a signed corporate resolution giving

the bidder the authorization to bid and identifying which excess land he is allowed to bid

on, or for LLC’s the operating agreement. These documents must be verified by the

Registrar prior to bidding. A comparison of names of those in attendance shall be made

against the names and addresses of any person or corporations prohibited from bidding,

and bids shall not be accepted from any such persons. No bids shall be accepted from

employees of the Department or their immediate families without approval from the

Director of Right of Way and the Deputy Attorney General. The State employee must be

attending the auction on their own time, have signed a disclosure statement. The

disclosure statement shall have been prepared by the DAG. Any interested State employee

must notify the Property Management Section at least 7 days in advance of the auction of

the desire to attend the auction so that a DAG can be present at the auction.

Where technologically feasible, the Department may utilize an internet based auction

system, which will either supplement or replace the current in person auctions.

4.31.9 Conduct of In Person Auction

The Supervisor for the Property Management Section of the Bureau of Technical Support

or designee shall open the auction at the hour specified in the public notice and announce

the terms and conditions under which the auction will be conducted. A sign in list shall be

maintained and each person who arrives for the auction shall be required to sign in. Each

151

person who wishes to participate in the auction will be assigned a bidder number. This

number will be written next to their name on the sign in sheet and acknowledged by the

potential bidder. Each bidder will also receive a copy of the conditions of the sale, and will

be required prior to the start of the bidding to return the form signed, acknowledging that

they read the conditions. The Registrar shall read out loud the conditions of the sale prior

to the start of the auction. The bidders will be instructed to show their number to the

auctioneer and the recording person when bidding. A description of the property, as well

as the map for each property to be auctioned will be posted on a wall in the room where

the auction is to occur.

A copy of the winning bid acceptance form shall be posted on the wall of where the auction

takes place and copies shall be available for review by the bidders. At the beginning of the

Auction, all bidders are to be made aware of the contract that they will be required to sign

if they are the winning bidder and to the fact that the winning bidder must have either

money order, certified check or cash in the amount of 25% of the winning bid.

At the start of the auction the auctioneer, a member of the Property Management Section

shall request bids and the recorder shall tabulate the bids made until no more bids are

received. The auctioneer shall repeat the final bid three times, given the bidders each time

a final opportunity to bid. Failing to receive any additional bids, the auctioneer will

announce the number of the high bidder and the amount of the winning bid. The winning

bidder will be required to provide a deposit in cash or by certified check or money order in

the amount of at least 25% of the bid price, and to sign three copies of the Bid Acceptance

Forms and three copies of the contract of sale or lease for the winning bid. The bidder will

need to sign a successful bidder information sheet. This will indicate how the name should

appear on the deed and what address the deed work should be sent to, as well as a contact

phone number for the high bidder. If the high bidder wishes to put the name in a name

other than that of the bidder, documentation may be requested from the bidder showing

that the bidder has the authorization to do so.

The winning bidder will receive a copy of the bid acceptance form, contract of sale or lease,

copy of the consideration left as the deposit and a receipt that the Property Management

Unit will prepare showing that it has received the deposit. The consideration, certified check

or money order will be kept in the Project Funding safe until the Director or his designee

signs the contract of sale or lease. In cases of cash left as a deposit, the deposit will be

made at the time the Property Management Unit receives it. The Project Funding Unit will

be provided a copy of the consideration prior to it being taken to the cashier, as well as a

copy of the deposit slip, and eventual receipt of payment from the cashier.

Copies of the winning bid acceptance form (contract of sale), the bidder information sheet,

sales deposit receipt and the receipt of payment from the cashier will be made and kept in

the file for the excess land parcel. In addition a copy of the excess land deposit, receipt

from cashier and executed contract of sale will be kept in the Property Management Section

Supervisor’s folder for excess land sold for that calendar year.

Within three working days of the receipt of bids, a Department Action for the sale shall be

prepared and routed to the Manager of the Bureau of Technical Support, Project Funding

Unit and then to the Director of Right of Way. A contract of sale shall not be assignable

without prior written consent of the Commissioner.

4.31.10 Forfeiture of Deposits on Excess Land Contracts

When a high bidder fails to comply with the auction terms, the Bureau of Technical Support

Manager shall have a member of the unit prepare a Department Action recommending the

152

steps to be taken including forfeiture of a sufficient amount of the deposit to cover the

costs of the auction, any reductions from the high bidder amount that the Department

finally obtains and any costs incurred in re-auctioning the property.

When a contract purchaser for excess land, not the result of an auction but through a direct

sale, fails to follow through on the purchase for reasons other than just cause as spelled

out in the contract, the purchaser will forfeit their deposit, if any was received. The

purchaser will be notified via certified mail after the Property Management Section has

made reasonable attempts, which shall include notification by mail to remit the balance of

the outstanding purchase price, that the purchaser will forfeit their deposit if the balance

outstanding is not received within 10 days of receipt of the letter. If the Property

Management Section fails to receive the balance of contract price, a Department Action

will be prepared recommending steps to have the deposit forfeited as a result of the breach

of contract.

4.32 Handling of Cash

Departmental Operating Procedure, No.4-501H, Cash Receipts Invoicing, defines the

procedures for handling cash. "Cash" refers to any currency, coins, checks, drafts, money

or other cash equivalent. The Secretary of the DOT is designated as the Cashier and all

receipts shall be delivered to the Cashier the day of the sale or the day that a rental

payment is received, unless receipt of that payment is after 3 pm and then the payment

will be locked in the safe for deposit the next business day.

The Manager of the Bureau of Technical Support will maintain appropriate internal

operating records and the Department Actions establish a double entry records system

whereby Accounting is notified of all receipts, balances due and performance deposits,

establishing an accounting record and the basis of the audit process.

4.33 Property Leasing

The Property Management Section of the Bureau of Technical Support will draft all leases

that are not in connection with an active job and will do so in accordance with N.J.S.A.

27:7-21.4, N.J.S.A. 27:7-21.6, and N.J.S.A. 52:31-1.8. The Relocation & Property

Management Section will obtain all the necessary Department review units’ approval prior

to drafting any leases. The Department review units are listed in Department Clearance of

Excess Land. The Property Section will then obtain staff or fee appraisal assistance to

obtain a rental value, which will include the municipal service in lieu of taxes charge, and

will obtain State House Commission Approval, if required. Whether or not State House

Approval is needed, notification will be sent to the Clerk for the Municipality and the County

where the property is located about the Department’s decision to proceed with a lease. If

an auction is required, it will be done so in accordance with the Department’s auction

procedures.

If a lease entered into by public auction contains an annual rental adjustment provision,

State House Commission approval is not required to renew the existing lease. If the lease

does not contain such a provision, any adjustment to the lease rental must be approved

by the State House Commission. The Commission can adjust the rental without the need

for a new public auction. Any substantive changes to existing leases require prior State

House Commission approval.

As with all leases drafted by the District, only the Director or designee is to sign the lease

for the Department.

153

N.J.S.A. 27:7-21.6. Option to prior owner or person in possession; lease to public body or

agency; competitive public bidding: publication of notice - If pursuant to this act the

Commissioner of Transportation determines to permit the temporary lease of property, he

shall give the first option to acquire the lease to the prior owner or person in possession

at the time of acquisition or taking of said property. If the property is leased to an owner

or person in possession at the time of acquisition or taking of said property, to a public

body or agency for public use, to persons in need of temporary relocation facilities as a

result of being displaced by any public action, or to persons or for uses exempted pursuant

to article 2 of Title 54 of the Revised Statutes, the Commissioner may lease such property

by private negotiation upon such terms and conditions as he shall determine to be in the

best interests of the State.

Leasing to a public body or agency, such as a municipality, for public purposes, the lease

may be at a nominal rental. Where possible, the Department will attempt to sell rather

than lease property for public use.

Leasing subject to an Auction - Except as provided by this section all property leased

pursuant to this act shall be leased by competitive public bidding procedures to the highest

responsible bidder, except for those leases where the property can only be used by one

party. An example would be a landlocked piece of NJDOT property that has only one

adjoining owner and cannot be accessed except through that adjoining owner’s property.

(Approval to lease property through auction to the highest bidder must have been

approved by the State House Commission prior to an auction taking place).

Publication Notice - Where property is leased pursuant to competitive bids, a notice of

intention to receive bids, briefly describing the property to be leased including any

minimum rental established for the property and providing a means to review the terms

and conditions of the proposed lease, , shall be published in at least one newspaper in the

municipality in which the property is located at least 10 days prior to close of the auction.

N.J.S.A. 52:31-1.8. Notification to municipality of State’s determination to sell, convey

interest in real property – When a determination is made by the head or principal executive

of any State department to sell and convey all or any part of the State’s interest in any

real property held by the department and the improvements thereon or to grant an

easement in or across such property, without regard to the value of the property or

easement, upon a finding that the department does not require such property or interest

for any public purpose and that such sale is in the best interest of the State, the

department shall notify in writing the governing body of each municipality in which the

property is located that the determination has been made by the department for such sale

or conveyance of the state’s interest or the grant of an easement. The notice shall be

made regardless of the value of the property and also shall state whether approval by the

State House Commission is required prior to the sale or conveyance or grant. The notice

shall be sent at least 14 days prior to any further action taken by the department after

the determination in order to permit a municipal review and formulation of a response, if

any. This notification shall apply to all property to be sold or conveyed or for which an

easement is to be granted pursuant to the authorization granted by P.L.1962, c.220

(C.52:31-1.1 et seq.) or pursuant to any other statute or authority.

The Property Management Section of the Bureau of Technical Support shall be responsible

for sending the written notice to the Clerk of the Municipality and the Clerk for the County

at least 14 days prior to any further action by the Department for all proposed leases that

are not in connection with an active job.

154

The District will be responsible for sending the notices for all proposed leases associated

with active jobs. The notice shall be sent certified mail, return receipt requested. If the

proposed lease is to the occupant of a property we have acquired for an active job, the

notice shall state that such leasing is required by State and Federal law and regulation

regarding the provision of relocation assistance and that it is our intention to lease the

property until it is required for construction purposes. These leases do not require State

House Commission approval.

4.33.1 Property Leasing Prior to Construction

The District will be responsible for temporary leases to the occupants on properties being

acquired for a project. A lease to an occupant may be used only if the project schedule

provides enough time to allow an existing occupant to continue to reside in the acquired

property for a limited period of time. The District may also undertake with the assistance

of The Property Management Section to implement a protective lease, described later to

prevent new tenants from moving into a property that is being acquired. The Districts will

prepare all leases on active projects in accordance with N.J.S.A. 27:7-21.4, N.J.S.A. 27:7-

21.6 and N.J.S.A. 52:31-1.8.

N.J.S.A. 27:7-21.4. authorizes leasing property acquired for transportation purposes and