6601. Eligibility

A displaced residential owner or tenant is eligible for a replacement housing payment if they are displaced from a dwelling and meet the definition of a Displaced Person as defined in Section 6115.09. The dwelling from which the person is displaced must be their primary permanent residence (see Section 6115.12). Eligible Displaced Persons may be provided a payment for replacement housing under the following provisions:

6601.01 Lawfully present in the United States

To qualify for a replacement housing payment, a Displaced Person must be a citizen, a national, or an alien lawfully present in the United States (except under certain hardship conditions).

1. If the Displaced Person is a citizen or a national, no further steps are required.
2. If the Displaced Person is an alien lawfully present in the United States, they must provide documentation supporting their status. The Relocation Agent must evaluate this documentation in accordance with 49 CFR 24.208. The ODOT Central Office Relocation Section must also be contacted to ensure statewide consistency.

The Displaced Person must sign a statement stating they are a citizen, national, or an alien lawfully present in the United States. The Displaced Person certifies they are eligible when they sign for the Relocation Brochure and again when signing the Relocation Claim form (RE-617).

6601.02 Occupancy Status

The payments available to eligible Displaced Persons are based on the type of occupancy (owner or tenant) and the length of occupancy at the acquired site. Length of occupancy requirements are not intended to deny relocation benefits to someone who is temporarily not in occupancy of their usual dwelling because of illness or another temporary situation. Provided below are the occupancy criteria for establishing residential relocation benefits:

1. 90-Day or More Owner Occupant - an occupant who has owned and occupied the dwelling from which they are being displaced for a least 90 consecutive days immediately prior to the initiation of negotiations for the parcel.
2. 90-Day or More Tenant Occupant – a tenant occupant who has leased and occupied the displacement dwelling for at least 90 days immediately prior to the initiation of negotiations for the parcel.
3. Owner or Tenant Occupant of Less Than 90 Days - a person who was in legal occupancy of the dwelling less than 90 days prior to the initiation of negotiations. This also includes all Displaced Persons who legally occupy the property after the initiation of negotiations, but prior to the agency acquiring possession of the property.

6602. 90-Day Owner Occupant

6602.01 Eligibility

A Displaced Person is eligible to receive replacement housing payments as a 90-Day homeowner occupant if the person:

1. Has actually owned and occupied the displacement dwelling as their principal residence for not less than 90 days immediately prior to the initiation of negotiations (see Section 6115.23); and
2. To qualify for a replacement housing supplement, a Displaced Person must purchase or rent and occupy a decent, safe and sanitary (DS&S) replacement dwelling within one year after the later of:
   1. The date they receive final payment for the displacement dwelling, or in the case of an appropriation, the date the final payment was deposited in the court; or,
   2. The date a comparable replacement dwelling is made available to the Displaced Person.

A Displaced Person is not required to purchase the offered comparable housing to qualify for a replacement housing payment. Comparability is merely used as the standard to determine the upper limit of a replacement housing price differential to which the Displaced Person may be entitled. A Displaced Person may purchase any type of housing in any location of their choice.

An extension of the one year time period to purchase and occupy may be granted for good cause, such as an acute or life threatening illness, bad weather preventing the completion or construction of a replacement dwelling or other like circumstances that cause delays in occupying a DS&S replacement dwelling. A time period extension requires written approval from the ODOT Central Office Relocation Section Manager.

6602.02 90-Day or More Homeowner Occupant - Amount of Payment

The total replacement housing payment for a 90-Day or more homeowner occupant may not exceed $31,000.00 unless the provisions of Last Resort Housing apply (see Section 6607). The payment will be the sum of:

1. The Replacement Housing Price Differential as computed in accordance with Section 6602.03
2. The increased interest costs incurred in connection with the mortgage(s) on the replacement dwelling, in accordance with Section 6602.04.
3. The reasonable incidental expenses incurred in the purchase of the replacement dwelling, in accordance with Section 6602.05.

6602.03 Price Differential

A Displaced Person cannot be required to move until 90 days after a comparable replacement dwelling is made available. The comparable must be within the financial means of the Displaced Person. In order to ensure the comparable is within the financial means of the Displaced Person the price differential must be presented to the Displaced Person. For more information on selecting a comparable see Section 6604.

There are two distinct calculations of the price differential which are discussed in detail below. First, the maximum price differential, or the Relocation Offer, is based on the difference between the list price of the prime comparable and the acquisition offer to the Displaced Person. Second, the actual price differential is based on the difference between the purchase price of the replacement dwelling or the asking price of the prime comparable, whichever is less, and the amount the Displaced Person receives from the agency for the acquired dwelling. The actual price differential can never exceed the maximum price differential.

1. Maximum Price Differential
   • The maximum Price differential is the maximum amount the Displaced Person may receive for the purchase of a replacement dwelling. It is the mathematical difference between the Fair Market Value Estimate (FMVE) of the site and the list price of the prime comparable.
   • The maximum price differential is computed by subtracting the FMVE of the displacement site from the asking price of the comparable. This amount is commonly referred to as the Relocation Offer. Below is an example of a maximum price differential computation:

Example 1

2. Actual Replacement Housing Differential Payment
   • The Replacement Housing Differential Payment is based on need, and the Displaced Person must actually incur a cost increase in purchasing their replacement home in order to receive a replacement housing payment. The differential payment is computed by using the lesser of (1) the asking price of the comparable dwelling or (2) the cost of the actual replacement dwelling purchased by the Displaced Person, minus the acquisition price of the displacement dwelling. Below is an example of an actual price differential computation:

Example 2

Payment is the lesser of (A) or (B)

(A)

(B)

• In this example, the Displaced Person purchased a replacement site that cost less than the list price of the comparable. Thus, the actual price differential payment was less than the Relocation Offer.
• Frequently the Displaced Person will elect to purchase a replacement property that costs more than the selected comparable. In these cases the actual price differential is limited to the price of the comparable minus the acquisition price of the displacement site. See example 3 below.

Example 3 Payment is the lesser of (A) or (B)

• In this example the actual price differential would be $13,000. Note the maximum price differential (aka, Relocation Offer) is based on the FMVE of the displacement site and the actual price differential is based on the actual price the agency pays for the displacement site. Any increase in the FMVE offer because of an administrative review, case settlement or jury award will reduce the amount of the maximum price differential (see Section 6606.14).
• The form RE-611 documents all price differential calculations.

6602.04 Increased Mortgage Interest Costs

A 90-Day homeowner who is displaced from their dwelling may be eligible for a payment based on an increase in their interest costs on their new mortgage. Mortgage information should be obtained from the Displaced Person as soon as possible after relocation eligibility has been established. Once the Relocation Agent establishes the Displaced Person may be eligible for an increased interest payment the Agent shall provide the Displaced Person with an estimate of the increased interest payment. The actual payment will then be calculated when the terms of the new mortgage are known.

1. Increased interest eligibility

• • To qualify for an increased interest payment the displaced 90-Day homeowner must:

1. 1. 1. Have had a bona fide mortgage on the acquired residence that has been in place for at least 90 days prior to the initiation of negotiations for the acquired site. A bona fide mortgage is any valid, recorded lien(s) (including land contracts) on the property; and,
      2. Acquire a mortgage on the replacement dwelling; and,
      3. The new mortgage must have resulted in an increase in the interest rate over that of the old mortgage.

1. Amount of Payment

• • Commonly known as a “buy down,” the payment for increased mortgage interest costs is the amount which will reduce the mortgage balance on a new mortgage to an amount which could be amortized with the same monthly payment for principal and interest and for the same duration as the mortgage(s) on the acquired site.
  • All computations for the estimated and final Increased Interest payments are made using a Microsoft Excel application that is contained on the ODOT Real Estate web site. It is the responsibility of the Relocation Agent to obtain all of information needed to properly calculate these costs.

1. Increased Interest Cost Estimate

• • As soon as the facts relative to the Displaced Person’s current mortgage(s) are known, the Displaced Person shall be advised of the estimated amount of the Increased Interest and the conditions that must be met to receive the payment. In order to provide the greatest amount of assistance to the Displaced Person, the computation and explanation of the estimated amount of Increased Interest should occur as soon as possible after the initial offer. An Agent must know the following four items in order to compute the increased interest cost estimate.

1. 1. 1. The estimated mortgage balance of the existing mortgage. This is the total amount which is owed on the principle of the mortgage; and,
      2. The principle and interest payment on the existing mortgage as set out in the loan documentation. Care should be taken to ensure the payment amount does not include any escrow payments for taxes and insurance. Only the payments for principle and interest shall be used for the increased interest computation; and,
      3. The interest rate of the existing mortgage. If the existing mortgage has an adjustable rate the Agent will use the most current adjustment for the increased interest calculations; and,
      4. The interest rate of the new mortgage (if known) or the prevailing rate in the area of the replacement site.

1. The Increased Interest Cost Payment

• • Increased Interest Cost is the payment made to compensate the Displaced Person for loss of favorable financing at the displacement site due to the Agency’s acquisition. The Microsoft Excel application [see Section 6602.04(B)] will calculate the amount the new (higher) interest rate could be amortized over the same term and with the same payments as the old mortgage terms. The difference between this amount and the amount of the old mortgage is computed as the amount needed to buy down the new mortgage.
  • Increased Interest Costs are based on the remaining terms (duration, amount, etc.) of the mortgage(s) on the displacement dwelling or the terms of the new mortgage, whichever are shorter or less.
  • The payment shall be made available at or near the time of closing on the replacement dwelling in order to reduce the amount of the new mortgage. The Agent must know the following six items in order to compute the increased interest cost payment.

1. 1. 1. The remaining Principal balance on the old mortgage; and,
      2. The interest rate of the existing mortgage. If the existing mortgage has an adjustable rate the Agent will use the most current rate adjustment for the increased interest calculations; and,
      3. The payment on the existing mortgage for principal and interest. If the existing mortgage has an adjustable rate the Agent will use the most current payments for the increased interest calculations. Do not include escrowed amounts in this computation; and,
      4. The new mortgage amount. This is the total amount borrowed for the purchase of the replacement site; and,
      5. The term of the new mortgage. If the mortgage or land contract has a balloon payment at the end, contact the ODOT Central Office Relocation Section for guidance and direction; and,
      6. The interest rate of the new mortgage or the prevailing interest rate, whichever is less. For more information on “prevailing rates” see Section 6602.04(E)(4) below.

1. Limiting Factors and Other Important Information.

1. 1. The payment will be based on the unpaid mortgage balance(s) on the displacement dwelling. In the event the new mortgage’s principal amount is smaller than the computed amount necessary to finance, the computer will calculate the prorated payment amount.
   2. In the case of a home equity loan, the unpaid balance will be that balance which existed 90 days prior to the initiation of negotiations or the balance on the date the Agency closes on the acquisition of the displacement site, whichever is less.
   3. If there are multiple mortgages, compute the buy down by completing the calculations for each mortgage using the terms of that specific mortgage. If there is an existing mortgage that has a higher interest rate than any currently available rates, the buy down amount will be zero. The payment will be based on the remaining term of the mortgage(s) on the displacement dwelling or the term of the new mortgage, whichever is shorter.
   4. The interest rate on the new mortgage used in determining the amount of the payment cannot 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, unless there is justification to do otherwise. Justification may be based on the unavailability of the current prevailing rate due to the amount of the new mortgage, credit difficulties or other reasons.

• • • The Relocation Agent must know the prevailing interest rates. Prevailing rates can be researched by using the internet, local newspapers and/or personal contact with local banks and lending institutions. The prevailing rate is not necessarily a fixed number but rather an average of what local lenders are currently using. The Displaced Person’s rate then needs to be compared to these rates to determine if it is reasonable.

1. 5. Purchaser’s points and loan origination or assumption fees (but not Seller’s points) may be paid as an increased interest cost to the extent that:

1. 1. 1. They are not paid as incidental expenses; and,
      2. They do not exceed rates normal to similar real estate transactions in the area; and,
      3. The Agency determines them to be necessary. Purchaser’s points are not eligible if the points are used to buy down the mortgage to a rate which is lower than the rate of the displacement mortgage.
      4. The computation of such points shall be based on the unpaid balance of the displacement mortgage, less the amount determined for the reduction of the mortgage balance under this section.

1. 6. In the case of a partial acquisition of a tract normal in size for residential use in the area, that includes the dwelling, the interest payment shall be reduced to the ratio/percentage that the acquisition price bears to the before value. This reduction shall not apply if it is required that the entire mortgage be paid off as a result of the acquisition, thus making it necessary to completely refinance.

Example

1. • • In the case of a partial acquisition of a tract larger than normal in size for residential use in the area, that includes the dwelling, the interest paid shall be reduced to the ratio/percentage that the value of the residential portion (NHSV) bears to the before value. This reduction shall apply whether or not it is required that the entire mortgage balance be paid.
   7. The interest payment on multi-use properties shall be reduced to the ratio/percentage that the value of the owner occupied residential portion of the property bears to the before value.
   8. If the mortgage has a variable interest rate, the mortgage balance, interest rate and payment amounts in place at the time of the acquisition are to be used in the computations.
   9. If the existing mortgage has a balloon payment, the monthly payment amount must be recast based on the term of the loan. For example, if the Displaced Person has a loan with a term of 15 years, and a balloon payment due at the conclusion of the term, you would recalculate the monthly principle and interest payment based on a 15 year term. If this situation is encountered, the Agent should contact the Central Office Relocation Section for assistance.
   10. The increased interest payment may be made directly to the Displaced Person or directly to the mortgagee of the replacement dwelling via a Letter of Assignment. If an assignment is to be made to the mortgagee then they must complete a W-9 and Vendor Information Form.

6602.05 Incidental Expenses

A Displaced Person who purchases replacement housing may be eligible for reimbursement for those necessary and reasonable costs actually incurred that are incident to the purchase of the replacement dwelling, and customarily paid by the buyer.

Reimbursable expenses that are incurred by the origination of a new mortgage for the replacement dwelling (e.g., credit report, application fee, appraisal fee, origination fee, FHA Upfront MIP, VA Funding Fee, etc.) will be based upon the lesser of the balance of the mortgage(s) on the acquired dwelling or the amount of the new mortgage on the replacement dwelling. Eligible expenses are reimbursable regardless of the length of time a mortgage has been in effect on the acquired dwelling. If the Displaced Person did not have a mortgage at the acquired site they would not be entitled to reimbursement for mortgage related incidental expenses on the replacement site.

For tenants and less than 90-Day homeowners, reimbursement for incidental expenses, when combined with the actual down payment, cannot exceed the amount that was established for their rent supplemental determination.

If incurred by the Displaced Person, reimbursable incidental expenses may include the following:

1. Reasonable legal fees, closing, and related costs, including: notary fees, surveys, fees for preparing drawings or plats, recording fees, title search and fees for preparing conveyance instruments. Legal fees are only reimbursable if they relate to the purchase of the replacement property. Legal fees to represent the Displaced Person in claims against the agency are not reimbursable. Survey fees are reimbursable even if the Displaced Person does not have a mortgage at the acquisition site.
2. Lender, Federal Housing Administration (FHA) or Veteran’s Administration (VA) application and appraisal fees.
3. Professional home inspection certification of structural soundness, termite inspection and other inspections and certifications when reasonable and not paid by the seller.
4. Credit report.
5. Owner's and mortgagee's evidence of title, such as title insurance, not to exceed the costs for a comparable replacement dwelling, is reimbursable whether or not such insurance is required by the lender. Title Insurance reimbursement shall also include additional endorsements, such as EPA, if they are deemed typical for the market area.
6. Escrow agent’s fee.
7. Transfer tax stamps not to exceed the costs of same for a comparable replacement dwelling.
8. Upfront mortgage default insurance, such as the FHA’s Upfront MIP or the VA’s Funding Fee. Payment will be based upon the lesser of the balance of the existing or the amount of the replacement mortgage. This payment will not include any annual or monthly PMI/MIP payments.
9. Such other costs the Agency has determined to be necessary and incidental to the purchase of the replacement dwelling.

Seller’s costs and prepaid expenses are not eligible for reimbursement. Prepaid expenses include real estate taxes, certain insurances, including hazard or homeowner’s insurance, PMI/MIP escrow seeding, and in some cases, interest charged on the mortgage for a short period of time (e.g., the period of time between the placing of the mortgage monies in escrow by the lender and the date of the first mortgage payment).

Reimbursable Incidental Expenses, supported by a signed closing statement (e.g., HUD-1, Closing Disclosure Form or ALTA Settlement Statement) and/or other acceptable documentation, are to be itemized on the Form RE-611-2. In addition, the Relocation Agent must create a memo to file which contains a short explanation of each eligible incidental expense that will be reimbursed. This memo to file shall be submitted with the RE-611-2. The RE-611-2 and memo to file must be approved by the Relocation Reviewer prior to the claim being processed.

When a carve-out is necessary for the replacement site, all incidental expenses that vary based on the purchase price shall be prorated at the same ratio as the typical home site valuation is related to the replacement dwelling price.

6602.06 Rental Assistance Payment for 90-Day Owner Occupant Who Rents

A 90-Day owner occupant who is eligible for a replacement housing payment but elects to rent a replacement dwelling is eligible for a rent supplement payment. The amount of the rental assistance payment, if any, is based on a determination of economic/market rent for the acquired dwelling compared to a comparable rental dwelling available on the market.

All 90-Day owner occupants must be first offered a replacement housing payment. At the time of the offer the Relocation Agent shall explain that the Displaced Person is eligible for a rent supplement payment if they elect to rent a replacement dwelling. Ninety-Day owner occupants may not receive a down payment assistance payment.

The procedure for computing the Rent Supplement payment is outlined in Section 6603. The 30% of income approach is not to be used to compute the rent supplement offer for a 90-Day owner occupant.

The usual monetary limit of $7,200.00 for a rent supplemental payment does not apply in these situations. However, under no circumstances would the rental assistance payment exceed the amount that was established for the Displaced Person’s replacement housing determination. The Displaced Person who rents may still claim any unused portion of their replacement housing determination (original determination minus any received rent supplemental payments) during their remaining eligibility and claiming periods, should they elect to return to owner status.

Any increase in the final acquisition payment to an owner occupant (e.g., appropriation or administrative settlement) will reduce their final rental assistance payment, dollar-for-dollar, just as in 6606.12 and 6606.13.

6602.07 Billing Package - Owner Occupant of 90 Days or More Who Purchases

1. The complete billing package must be approved by the Relocation Reviewer prior to the Residential Claim Form (RE-617) being presented to the Displaced Person for signature. The contents of the billing package for a replacement housing payment are:
   1. W-9 Form and Vendor Information Form (VIF), as applicable.
   2. Original and one copy of the Residential Claim form (RE-617).
   3. One copy of the Residential Site Occupant Relocation Record form (RE-610).
   4. One copy of the Relocation Comparables and Additive Computation form (RE-611).
   5. One copy of the proof of purchase (closing statement signed & dated by both parties and a signed warranty deed).
   6. One copy of the Final Increased Interest Computation (Microsoft Excel printout), if applicable, including:
      1. One copy of documentation to support all figures used in the computation
      2. (e.g., the mortgage note, payment stub, bank statement, etc.)
      3. One copy of the Estimated Increased Interest Computation (MS Excel printout).
      4. One copy of the Incidental Expenses form (RE-611-2), if applicable, including:
         1. One copy of proof of incidentals if not shown on the closing statement. All receipts must be signed and dated.
   7. One copy of the Typical Home Site Computation form (RE-612), if applicable, including:
      1. One copy of the appraisal white sheet (RE-22).
   8. One copy of the Decent, Safe and Sanitary Certification form (RE-616).
   9. One copy of the Relocation Offer Letter/90-Day Notice Letter (RE-O).
   10. One copy of the memo to file on a request for Last Resort Housing, if applicable.
   11. One copy of the memo to file on a request for the Use of Less than Three Comparables, if applicable.
   12. One copy of the Assignment Letter when payment is made to a third party. The assignment must be signed and dated by both the Displaced Person and the Assignee. The Assignee’s tax identification number should appear on this form.
   13. One copy of any Appeal Letter and related documentation, if applicable.
   14. One copy of the Relocation Agent’s typed notes (RE-615).
   15. One copy of any miscellaneous documentation or memos to file in support of payments, as applicable.

6603. Rental Assistance Benefits for 90-Day Tenant Occupants

A tenant who has been in occupancy for more than 90 days prior to the initiation of negotiations is eligible for a rent supplement payment, reimbursement of moving costs and advisory services. Depending on their income level and their lease status, the rent supplement payment may be computed based on 30% of the household income or economic rent. The monthly cost of utilities is always included in the rent supplemental payment calculation, even if economic rent or 30% of income procedures are used. The Displaced Person may also elect to receive down payment assistance in lieu of a rent supplement entitlement.

6603.01 Eligibility

A Displaced Person is eligible to receive replacement housing payments as a 90-Day tenant if the person;

1. Is a lawful occupant of the displacement dwelling as their principal place of residence at the time of the initiation of negotiations; and,
2. They have rented or purchased, and occupied a decent, safe, and sanitary (DS&S) replacement dwelling within one year (unless the Agency extends this period for good cause) after:
   1. For a tenant, the date they moved from the displacement dwelling, or
   2. For an owner occupant, the latter of:
      1. The date they received final payment for the displacement dwelling; or in the case of an appropriation, the date the full amount of the Fair Market Value Estimate was deposited with the court; or
      2. The date they move from the displacement dwelling.
3. Any replacement housing payment for a Displaced Person who is in occupancy for less than 90 days shall be reimbursed under the provisions of last resort housing.

6603.02 Rental Assistance Entitlement

Tenants are eligible to receive a rental assistance entitlement that is computed for a term of 42 months. The maximum payment for a rental assistance entitlement is $7,200.00, unless the provisions of Last Resort Housing apply. This payment will be a Rent Supplement Payment if the Displaced Person elects to rent a replacement dwelling, or a Down Payment Assistance Payment if the Displaced Person elects to purchase a replacement dwelling.

A Displaced Person cannot be required to move until 90 days after a comparable replacement dwelling is made available, and the comparable must be within the financial means of the Displaced Person.

The Rental Assistance Entitlement is based on the difference between the monthly cost of rent and utilities of a comparable dwelling, and the monthly cost of rent and utilities at the displacement dwelling, multiplied by 42 months. Below is a sample computation of a Rental Assistance Entitlement;

6603.03 Rental Assistance Payment

There are two distinct components of the Rental Assistance Payment. First is the Rental Assistance Entitlement or Relocation Offer (see Section 6603.02). The Rental Assistance Entitlement is the maximum amount that the Displaced Person may receive as a Rental Assistance Payment. The final Rental Assistance Payment is based on the difference between monthly cost of rent and utilities at the displacement dwelling and the monthly cost of rent and utilities at the replacement dwelling, multiplied by 42 months, not to exceed the amount of the original determination/Relocation Offer.

Using the example above at Section 6603.02, the Rental Assistance Payment may not exceed $3,150.00. If the Displaced Person rents a replacement dwelling and the monthly base rent difference is a minimum of $75, the Displaced Person would receive $3,150.00 for the Rental Assistance Payment. If the monthly base rent difference is less than $75, the actual difference would be used to compute the Displaced Person’s Rental Assistance Payment. Below is a sample computation of a Rental Assistance Payment where the costs of the replacement dwelling are less than what was used to establish the Relocation Offer;

6603.04 Base Rent of Displacement Dwelling

The base monthly rent for the displacement dwelling is the lesser of:

1. The average monthly cost for rent and utilities at the displacement dwelling for a reasonable period prior to displacement, as determined by the Agency. For an owner occupant, the Agency will use economic rent for the displacement dwelling. If a tenant’s lease is not an “arm’s length transaction” (such as renting from a relative or employer) or if the tenant is providing a service in lieu of rent (such as maintenance or building management), the Agency will use economic rent, unless its use would result in a hardship because of the person’s income or other circumstance; or,
2. Thirty percent (30%) of the Displaced Person’s average gross household income (see Section 6603.06) if the amount is classified as low income by the U.S. Department of Housing and Urban Development’s Annual Survey of Income Limits for their Public Housing and Section 8 Programs. Should the Displaced Person refuse to provide appropriate evidence of income, or the information provided does not reasonably reflect the family lifestyle, or if the Displaced Person is a dependent, the base monthly rent will be the average monthly rent plus utilities. After examining the evidence provided by the Displaced Person, should the Relocation Agent elect to not to use the 30% of income approach, the file must be documented with a memo explaining the basis for that decision. A full time student or resident of an institution will be assumed to be a dependent, unless the person demonstrates otherwise; or,
3. The total of the amounts designated for shelter and utilities if the Displaced Person is receiving a welfare assistance payment from a program that designates the amounts for shelter and utilities.

6603.05 Utility Adjustment

As mandated by 49 CFR 24.402(b), the Base Monthly Rental figures used in rental replacement housing determinations shall include the average monthly cost for utilities. Generally, utility costs to be considered are heat, electricity, water/sewer and refuse removal. Heat is normally from natural gas, electricity, propane gas or fuel oil.

Any utility costs not included in the contract rent must be added to the rental amount to establish the Base Monthly Rents. The Local Housing Authority’s current Allowances for Tenant Furnished Utilities and Other Services, will be used to determine average cost of utilities at the displacement site, the comparable, and at the replacement site. If the area is not covered by a Local Housing Authority, the schedule for a nearby and similar Housing Authority shall be used.

6603.06 30% of Income as Base Monthly Rent

Household income is the total gross income received for a 12 month period from all sources (earned and unearned) including, but not limited to wages, salary, child support, alimony, unemployment benefits, workers compensation, social security or the net income from a business. Food stamps are not to be considered income for the purposes of this section. In addition, household income does not include income received or earned by dependent children and full time students less than 18 years of age.

In order to compute the base monthly rent based on 30% of the Displaced Person’s income, the income must be classified as low income by the U.S. Department of Housing and Urban Development’s (HUD’s) Annual Survey of Income Limits for the Public Housing and Section 8 Programs. HUD Public Housing and Section 8 Program Income Limits are updated annually and are accessible through FHWA’s website and HUD’s website.

All full time students or residents of institutions will be presumed to be a dependent, unless they demonstrate otherwise. Dependents are not eligible for a rent supplement payment based on 30% of their income.

After the Agency has received all the information requested, a decision must be made as to its validity. Verification of gross monthly household income is mandatory. Income should be documented through a verifiable source, such as pay stubs, signed income tax returns, a statement from an employer, or a bank statement. The burden of proof rests on the Displaced Person. If the Agency has reason to not believe the provided information, the file will be so documented and the supplemental payment will be computed based on economic or contract rent plus utilities. If the provided documentation is determined to be factual, the file must be so documented with a memo to file which details the verification of income and includes the Tenant Income Verification form (RE- 604), and how the 30% amount was determined.

6603.07 Disbursement of the Rent Supplement Payment

A rental assistance payment is made directly to the Displaced Person in a lump sum if it is $12,000.00 or less. If the payment is more than $12,000.00, it will be disbursed directly to the Displaced Person in quarterly installments until the balance of the Rent Supplement is $12,000.00 or less, and then the balance will be paid to the Displaced Person in a lump sum. The quarterly installment is the total of three months of the Displaced Person’s total rent payment (not to exceed the prime comparable property’s combined rent and utilities). 

Example

If the Displaced Person has a poor rental history, bad credit or any other type of obstacle to obtaining replacement housing, a rent supplement payment may be assigned directly to the landlord at the replacement dwelling.

6603.08 Rent Supplement Payment Vests

The full amount of the rental assistance payment vests immediately at the time the Displaced Person receives the first rental assistance payment, either as a lump sum or as an installment. The payment vests whether or not there is any later change in the person’s income or rent, or in the condition or location of the person’s housing. The exception to the payment vesting is upon the death of the Displaced Person, should this occur prior to the distribution of the entire payment (see 6606.25).

Under vesting, the only time a rental assistance payment may change is during the one-year period following displacement allowed for acquisition and occupancy. The only reasons for change are if the Displaced Person changes from tenant to owner status and becomes eligible for an additional payment, or if the tenant changes their housing to receive the full amount of the original computed rental assistance payment when they did not originally qualify for their full entitlement. In either of these cases, since the change in location or status will result in the receipt of additional monetary assistance, the housing being occupied must meet current DS&S standards. If the Displaced Person chooses to move during the one-year period to obtain all of their replacement housing payment they are not entitled to reimbursement for any second or subsequent move.

6603.09 Billing Package- Owner Occupant of Less than 90 Days or Tenant Occupant Who Rents

1. The complete billing package must be approved by the Relocation Reviewer prior to the Residential Claim Form (RE-617) being presented to the Displaced Person for signature. The contents of the billing package for a replacement housing payment are:
   1. W-9 Form and Vendor Information Form (VIF), as applicable. 
   2. Original and one copy of the Residential Claim form (RE-617).
   3. One copy of the Residential Site Occupant Relocation Record form (RE-610).
   4. One copy of the Relocation Comparables and Additive Computation form (RE-611) plus the Utility Allowance Schedule for the site and comparables.
   5. One copy of the signed and dated lease or three rent receipts for the acquired site and one rent receipt for the replacement site, plus the Utility Allowance Schedule for the replacement site.
   6. One copy of the Economic Rent, if applicable, including:
      1. One copy of the documentation to support all figures used in the Economic Rent computation.
   7. One copy of the Tenant Income Verification form (RE-604) if the 30% of income approach is applicable. Include a copy of the appropriate U.S. Department of Housing and Urban Development’s Annual Survey of Income Limits for the Public Housing and Section 8 Programs web page highlighted for the project area.
   8. One copy of the Decent, Safe and Sanitary Certification form (RE-616).
   9. One copy of the Relocation Offer Letter/90-Day Notice Letter (RE-O or RE-T).
   10. One copy of the memo to file on a request for Last Resort Housing, if applicable.
   11. One copy of the memo to file on a request for the use of Less than Three Comparables, if applicable.
   12. One copy of the Assignment Letter when payment is to be made to a third party. The assignment must be signed and dated by both the Displaced Person and the Assignee. The Assignee’s tax identification number should also appear on this form.
   13. One copy of any Appeal Letter and related documentation, if applicable.
   14. One copy of the Relocation Agent’s typed notes (RE-615).
   15. One copy of any miscellaneous documentation or memos to file in support of payments, as applicable

6603.10 Down Payment Assistance

Any Displaced Person eligible for a rental assistance payment under Section 6603, may choose to use that payment as a down payment supplement, including incidental expenses, to purchase a replacement dwelling.

A displacee eligible to receive a replacement housing payment as a 90-Day homeowner-occupant under Section 6602 is not eligible for this down payment assistance payment, with the exception of a mobile home owner who rents or leases the mobile home site.

An eligible Displaced Person who chooses to purchase a replacement dwelling is entitled to a down payment assistance payment equal to the greater of the amount the person’s rental assistance entitlement (see 6603.02) or $7,200.00 subject to the following provisions:

1. The full amount of the replacement housing payment for down payment assistance must be applied to the purchase price of the replacement dwelling and/or related incidental expenses.
2. The payment to a less than 90-Day home owner occupant shall not exceed the amount the owner would receive under Section 6602.02 if they met the 90-Day occupancy requirement

Example A:

A displaced tenant is eligible to receive a rent supplement entitlement in the amount of $8,750 based on an available comparable unit. If the person elects to purchase a replacement home they would be eligible for a down payment assistance payment in the amount of $8,750.00.

Example B:

A displaced tenant is eligible to receive a rent supplement entitlement in the amount of $2,250.00 based on an available comparable unit. If the person elects to purchase a replacement home they would be eligible for a down payment assistance payment in the amount of $7,200.00.

6603.11 Billing Package - Owner Occupant of Less than 90 Days or Tenant Occupant who purchases a replacement dwelling and is reimbursed for a down payment

1. The complete billing package must be approved by the Relocation Reviewer prior to the Residential Claim Form (RE-617) being presented to the Displaced Person for signature. The contents of the billing package for a replacement housing payment are:
   1. W-9 Form and Vendor Information Form (VIF), as applicable.
   2. Original and one copy of the Residential Claim form (RE-617).
   3. One copy of the Residential Site Occupant Relocation Record form (RE-610).
   4. One copy of the Relocation Comparables and Additive Computation form (RE-611) plus the Utility Allowance schedule for the site and comparables.
   5. One copy of the signed and dated lease or three rent receipts for the acquired site.
   6. One copy of the proof of purchase (closing statement signed & dated by both parties and a signed warranty deed), if applicable.
   7. One copy of the Economic Rent, if applicable, including:
      1. One copy of the documentation to support all figures used in the Economic Rent computation.
   8. One copy of the Tenant Income Verification form (RE-604) if the 30% of income approach is applicable. Include a copy of the appropriate U.S. Department of Housing and Urban Development’s Annual Survey of Income Limits for the Public Housing and Section 8 Programs web page highlighted for the project area.
   9. One copy of the Decent, Safe and Sanitary Certification form (RE-616).
   10. One copy of the Relocation Offer Letter/90-Day Notice Letter (RE-O or RE-T).
   11. One copy of the memo to file on a request for Last Resort Housing, if applicable.
   12. One copy of the memo to file on a request for the use of Less than Three Comparables, if applicable.
   13. One copy of the Assignment Letter when payment is made to a third party. The assignment must be signed and dated by both the Displaced Person and the Assignee. The Assignee’s tax identification number should appear on this form.
   14. One copy of any Appeal Letter and related documentation, if applicable.
   15. One copy of the Relocation Agent’s typed notes (RE-615).
   16. One copy of any miscellaneous documentation or memos to file in support of payments, as applicable

6604. Comparable Housing

The maximum replacement housing payment for an owner or tenant is based on the cost of a comparable replacement dwelling (see Section 6115.06). The required 90-Day notice cannot be issued to a person displaced from a dwelling until a comparable replacement dwelling is made available to the Displaced Person.

6604.01 Availability of the Comparable

No person to be displaced shall be required to move permanently from his or her dwelling unless at least one comparable replacement dwelling has been made available to the person. When possible, three comparable replacement dwellings shall be located and the offer/payment computed on the basis of the dwelling most nearly representative of, and equal to or better than, the displacement dwelling. A comparable replacement dwelling will be considered to have been made available to a person if:

1. The person is informed of its location. The Relocation Offer letter which is given to the Displaced Person at or near the initiation of negotiations shall contain the address of the comparable dwelling; and,
2. The person has sufficient time to negotiate and enter into a purchase agreement or lease of the property. The comparable must be available to the Displaced Person at the time of the offer. The Relocation Agent must check the availability of the comparable with the listing agent or landlord immediately prior to making the offer to the Displaced Person; and,
3. Subject to reasonable safeguards, the person is ensured of receiving the relocation assistance and acquisition payment to which the person is entitled in sufficient time to complete the purchase or lease of the property. The Agent shall process all claims expeditiously and must provide adequate advisory services to ensure the Displaced Person has the necessary information and funds available to purchase or rent their replacement housing.

6604.02 Number of Comparable Properties

The maximum replacement housing payment shall be based on the cost of a comparable dwelling. Three comparable replacement dwellings shall be located and the price differential will be computed on the price of the dwelling most nearly representative of, and equal to or better than, the displacement dwelling.

In unique situations, with written justification, detailed file documentation and the written approval of the Relocation Reviewer (via Form RE-611) and the District Real Estate Administrator (via signed memo to file request), the use of less than three comparables may be permitted. Less than three comparable determinations will be the exception and not the norm for computing price differentials, and only in extreme circumstances (no rental market in the area, displacement dwelling size makes it very challenging to find a suitable comparable, etc.) will it be allowed. The request to use less than three comparables shall include the following:

1. A memo to file documenting the search process and the reason for the request. The memo must specify the length of the search, the area searched and all sources used (MLS, internet, local publications, real estate agents, etc.).
2. Form RE-611.
3. Site description.
4. Comparable(s) description.
5. Site/Comparable Analysis (see Section 6604.05).
6. Form RE-612, as applicable.
7. Any other relevant documentation.

The justification for the use of less than three comparables will be based on the fact that a reasonable search could not locate three comparable properties which are “as good” or “better than” the subject.

6604.03 Reasonable Search

The factors that define a reasonable search are the real estate market, the search area, the uniqueness of the displacement residence and/or the timing of the project. It is important that a search for comparable replacement housing be efficient and exhaustive. This is especially true with projects that have aggressive right of way clear dates. The search must be well documented. The documentation need not be lengthy, but it must be specific and complete. Documentation should include property addresses, numbers of rooms/bedrooms, list or rental prices, contact information and the reason the property was or was not used as a comparable.

The components of a reasonable market search are described below.

Real Estate Market: If a market has a very limited number of houses for sale in the search area, or the market is very active, resulting in homes selling very quickly after they are listed, the Relocation Agent may need to request approval for the use of less than three comparables and/or the use of last resort housing. There must be documentation to support the market conditions. A blanket statement by the Relocation Agent that the market is limited or very fast moving is not sufficient. The documentation must be specific and complete for the specific real estate market.

Search Area: The search area may vary depending on the displacement site, its location and local market conditions. The search should start in the neighborhood of the displacement site and expand to include housing in nearby or similar neighborhoods where housing costs are generally the same or higher. The area of search may extend outward from the project area as warranted and adequately documented. Before using last resort housing or less than three comps, consideration should be given to expanding the search area or waiting for market conditions to change (e.g., the rental market may improve in a college town during summer break).

Uniqueness of the Displacement Site: If the displacement site has features or characteristics that are unique to the market, last resort housing or the use of less than three comparable properties may be justified. Examples would be a finished basement or converted garage which adds an unusual amount of habitable living space, a ranch home in an area where ranch homes on the market are rare, or an unusually large number of bedrooms. Section 6604.06 of the ODOT Real Estate Manual addresses functional equivalency, and states that a comparable dwelling need not possess every feature of the displacement dwelling, but the principle features must be present. Functional equivalency should be considered when searching for comparables. Only in unusual circumstances, and with adequate justification, may a comparable dwelling contain fewer rooms or less living space than the displacement site.

Timing: A fast approaching Right of Way clear date may affect the length of a reasonable search. A search should continue until three comparable homes within normal parameters are located. Exceptions which would justify the use of last resort housing or the use of less than three comparables would be if a longer search would not result in a more economical comparable or in locating a total of three comparables, or that a longer search would put the clear date of the project in jeopardy. In all cases of last resort housing or the use of less than three comps, all decision points must be fully documented. There may also be justification for the use less than three comparables if there is one very good comparable to a unique home and there is a risk of losing that comparable during the search for two additional comps.

1. Sources to be used to locate Comparables.
   • In order to conduct an effective and efficient search, all reasonable housing market resources need to be searched. There is no best place to find comparables. Sources will vary greatly depending on the market location and the availability of computerized data systems. In some respects the availability of comparables is only limited by the person who is conducting the search. An active, knowledgeable and determined researcher will almost always find adequate comparable properties. Good sources to use are local Real Estate Agents, newspapers, the internet and “for sale by owners.” A good working relationship with local Real Estate Agents is essential in order to access their multiple listing services (MLS). Most MLS’s are now computerized and many have done away with the printing of monthly or weekly listing books. To gain access to this data the Relocation Agent must develop a working relationship with a local MLS member who has access to the system. There are also several internet sites such as “realtor.com” which are a very effective way to find comparables. Another source for comparables are websites maintained by local real estate companies. Newspapers and local real estate publications may also be a source for comps, especially rentals. Be cautioned that even though working with local real estate agents is important to the search, the Relocation Agent must not steer Displaced Persons to use specific agents.
2. Documentation
   • Documentation of the search is just as important as the search itself. Documentation provides the necessary justification and support for any requests for last resort housing or the use of less than three comparables. Again, the documentation does not need to be lengthy but it must be specific and complete. Names and numbers of Real Estate Agent contacts, copies of listings, newspaper ads and computer printouts are all good forms of documentation. No request for last resort housing or the use of less than three comps will be granted without specific and complete written documentation.

6604.04 Selecting the Comparables

The prime comparable that is selected to be offered to the Displaced Person, shall be the dwelling most nearly representative of, and equal to or better than the displacement dwelling. The RE-611 is the form used to document the comparables and the selection of the prime comparable. In addition, the RE-611 is used to compute the replacement housing price differential and the final payment amount. The factors of comparability listed on the RE-611 are discussed in more detail below.

Many factors of comparability are objective, but some are subjective. Thus, the Relocation Agent must exercise sound judgment when selecting a prime comparable. The comparable may not possess every feature of the displacement dwelling but must always meet the test of “equal to or better than.” The Relocation Agent who signs the RE-611 must have personally inspected the interior of the displacement site and the all of the comparables used in the determination. When inspecting the properties, the Agent shall photograph all interior and exterior features.

6604.05 Site Description, Comparable Description and Site Comparable Analysis

A memo to file shall be included with the RE-611 when the Relocation Agent requests approval for their prime comparable. The memo should include a detailed description of the displacement site that is based on the Relocation Agent’s personal inspection. The age and condition of the home should be noted. The layout and size of all rooms and storage space shall be described in detail.

Features such as kitchen cabinetry, flooring, counter-tops and other amenities should be described. As applicable, the description shall discuss finished basements, enclosed porches, three season rooms, etc. It should also note unusual features, extraordinary improvements and amenities. The exterior and yard shall be described.

Based on the Relocation Agent’s personal inspection, a similar description shall be included in a memo to file for each of the comparables

Interior and exterior pictures are required of the displacement site and each of the comparables used in the determination. Relocation Agent’s photos, as opposed to Realtor or Property Agent generated photos, are to be used on all relocation determinations. All pictures shall be labeled by using the parcel number and the address of the dwelling and a brief description of what is being depicted (e.g., kitchen, family room, master bedroom, basement storage area, etc.). ODOT provides a standard form (RE-PH) for organizing photos of the subject property and all comparables. The form is available on ODOT’s website.

The principle consideration when selecting the prime comparable is that the prime comparable must be “equal to or better than” the displacement site.

49 CFR 24.2(a)(6) states, “… While a comparable replacement dwelling need not possess every feature of the displacement dwelling; the principal features must be present….”

The site to comparable analysis must always address any difference between the prime comparable and the displacement site. The analysis should also establish that the prime comparable meets the test of “equal to or better than.”

6604.06 Functionally Equivalent

Functionally equivalent means that a dwelling or a specific feature of a dwelling performs the same function and provides the same utility as that found in the displacement dwelling. While a comparable dwelling need not possess every feature of the displacement dwelling, the principal features must be present. Generally, functional equivalency is an objective standard, reflecting the range of purposes for which the various physical features of the dwelling may be used. However, in determining whether a comparable dwelling is functionally equivalent to the displacement dwelling, the Agency may consider reasonable trade-offs for specific features when the comparable unit is “equal to or better than” the displacement dwelling.

For example, if the displacement dwelling contains a pantry, and a dwelling with a similar feature is not available, a comparable dwelling with ample kitchen cupboards may be acceptable. Or insulated and heated space in a garage might prove to be an adequate substitute for a basement workshop space. A dining area in a kitchen may substitute for a separate dining room. Under some circumstances, attic space could substitute for basement storage purposes, and vice-versa.

Every comparable analysis must clearly describe the Relocation Agent’s justification when employing functional equivalency in utilizing certain trade-offs between the comparable(s) and the displacement dwelling.

6604.07 Lot Size

The lot size may be addressed by either using dimensions (e.g., 60’ x 100’) or area (e.g., 1.5 acres). In addition to size, the topography, amount of care and maintenance, and current use of the lot should be considered in relationship to the Displaced Person. For example, a family with several children who use the yard extensively at the displacement site should be comped to a dwelling with a yard that offers a similar amount of play area. The comparable properties need not have the same or more area so long as the lot size is determined to be functionally equivalent.

6604.08 Type of Dwelling

The type of dwelling addresses a broad description of the building and the number of living units (e.g., two-story single family, ranch single family, two-story multi-family, etc.). These descriptions are included in a drop down menu on the RE-611.

The type of dwelling as it relates to “equal to or better than” generally assumes that the fewer number of units a building has the more desirable it becomes. For example, a duplex typically would not be used as a comparable for a person renting a single family home.

6604.09 Exterior Finish

The exterior finish of the dwelling (e.g., brick, vinyl siding, wood) shall be noted on the RE-611, and the search for comparables should begin with the same type of finish. The amount of exterior maintenance required is a factor of comparability. For example, a brick home usually requires less maintenance than a wood frame home.

6604.10 Age

The approximate age of the home shall be noted on the RE-611. The comparable search should begin with similar aged homes.

6604.11 Type of Neighborhood

Terms that describe the type of neighborhood include rural, urban, suburban, residential, etc. The comparable search should begin with and consider comparable property in similar neighborhoods.

6604.12 Garage

The garage should be described. The number of cars which the garage can accommodate must be noted. Half sizes should be used if the garage is larger than typical but cannot house an additional car. It shall also be noted if the garage is heated and attached or detached.

6604.13 Basement

It is important that the basement area is properly described. The size of the basement as it relates to the first floor of the dwelling should be noted. If there is no basement the term “slab” should be used. The presence of a crawl space should be noted. If the basement is not the same size as the first floor, or if an integral garage is under part of the first floor, the term “partial” shall be used. If the basement is the same size as the first floor the term “full” shall be used.

A basement is considered finished if there is drywall on the walls, carpeting or other floor covering on the floor and a drop or finished ceiling is present. This should be noted on the RE-611. The extent of finishing and the use of the room shall be further described in the Site Description write up. The amount of storage in the basement/crawl space should also be noted in the site description.

6604.14 Number of Rooms and Bedrooms

The comparable must meet the adequate size requirements in the definition of decent, safe and sanitary. Only in unusual circumstances may a comparable dwelling contain fewer rooms or bedrooms. If the comparable does contain fewer rooms or bedrooms, the site to comparable analysis must fully explain the difference and how the functional equivalency of the comparable relates to the displacement site and the Displaced Person’s use of the property.

6604.15 Number of Baths

In order to be considered a bathroom, the room must afford complete privacy. A bathroom with a toilet, sink and shower and/or tub is considered a full bath. A half bath contains a toilet and sink.

6604.16 Gross Square Footage

Only in unusual circumstances may a comparable dwelling contain fewer rooms or less living space than the displacement dwelling. Such may be the case when a decent, safe, and sanitary comparable 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.

Outside measurements are used to determine the living area of the site and the comparable. The Agency appraisal is to be utilized to document the measurement of the displacement site. County Auditor’s records shall be used to document the measurements of the comparables. If the agent’s field inspection finds discrepancies in either the measurements found in the appraisal or in the Auditor’s records, the agent must make their own exterior measurements.

Only rooms contained in the residence may be counted as living area. Any space in garages or outbuildings may not be considered as living area regardless of how that area is furnished.

Apartments and multiple unit dwellings, where exterior measurements are not a reflection of the dwelling unit, shall have the living area documented with interior measurements. Bathrooms, closets, utility rooms, hallways, foyers, basements and attics are not included in the measurement of habitable living space. Consistent interior or exterior measurements must be used on both the displacement dwelling and all comparables to create a true comparison of habitable living space.

The agent who completes the RE-611 is required to personally inspect the interior of the displacement site and all of the comparables used in the determination. During this inspection the agent should take into consideration the relative size of specific rooms, such as dining rooms, kitchens, etc. A displacement dwelling with a large kitchen or formal dining room should not be comped to a comparable dwelling with a small kitchen or no separate eating space.

6604.17 Decent, Safe and Sanitary

It is a requirement of 49 CFR 24.2(6)(i) that all comparable properties must be Decent, Safe and Sanitary (DS&S). DS&S is defined in Section 6115.08.

6604.18 Local Public Schools

If the displaced family has children, the search area should always begin within the boundaries of the current school district. In instances where a suitable comparable cannot be located within those boundaries, the search may be expanded to include comparable school districts in the area.

If the Displaced Person does not have children in school, the space on the RE-611 should be noted as N/A (not applicable). However the search shall always begin in the neighborhood in which the displacement dwelling is located. Where such comparable housing is not available, housing in nearby or similar neighborhoods may be utilized. The area of search may extend outward from the project area as reasonably necessary.

6604.19 Air Conditioning

If the displacement home has central air conditioning, the comparable should also have central air conditioning.

6604.20 Public/Private Utilities

It shall be noted on the RE-611 if the displacement home and comparables have public utilities or if they are serviced by a well and/or septic system.

6604.21 Public Transportation

The distance to Public Transportation shall be noted if the Displaced Person/family relies on such transportation to travel to work, schools, shopping, etc. If the Displaced Person utilizes public transportation, the comparables shall provide similar access to these services. If the Displaced Person/family does not depend on public transportation then this field should be marked N/A.

6604.22 Distance to Employment

The principle wage earner’s distance to work should be noted. It is a requirement that the comparable properties be reasonably accessible to the person’s place of employment. This should be taken into account during the search for comparable dwellings.

6605. Carve-Outs

If the displacement property is not a typical residential home site, the agency may “carve-out” the value of any extra land, improvements or non-residential real estate from the Fair Market Value Estimate (FMVE) in order to compute the price differential. If the replacement dwelling contains land or improvements that are used for commercial or farm purposes, the agency shall carve-out the value of the non-residential improvements in order to compute the replacement housing payment. Only that portion of the acquisition payment that is attributable to the displacement dwelling shall be considered when computing the price differential.

After the carve-out, the remaining value is that portion of the FMVE that is attributable to the owner- occupied portion of the acquired dwelling and an improved residential lot, typical in size for the area. The value of the area that remains after the carve-out is referred to as the Typical Home Site Computation (THSC). The RE-612 is the form to justify, document and calculate a carve-out.

6605.01 Required Carve-Outs

Carve-Outs are required in the following instances:

1. When the displacement dwelling is part of a property that contains other dwelling units, such as an owner occupant who rents part of the dwelling or other units on the property to non-family members.
   • For example: The owner of a multi-family dwelling occupies a unit in that structure. The owner is entitled to residential relocation payments for that portion of the property they occupy. In computing a Replacement Housing offer for the owner occupant of a multi- family dwelling, the value of the owner’s residential unit must be carved out of the total value of the acquired structure. The remaining value after the carve-out reflects the amount of the FMVE for the owner’s residential portion of the property. The search for comparables shall then be based on residences of similar size and utility to that of the owner’s occupied portion of the site.
2. Occupancy by two or more unrelated Displaced Persons who are not considered one family (see Section 6606.02(B) for more details).
3. The displacement site contains space used for non-residential purposes (see Section 6606.01 for more details).
   • When a Displaced Person occupies living quarters on the same premises as a business, farm or nonprofit organization, they will be eligible for a replacement housing payment based on a property comparable to the residential portion of the structure or property they occupy. The value of land and improvements used for non-residential purposes must be carved out of the FMVE in order to calculate the price differential.
4. The displacement dwelling is located on a lot that is significantly larger than is typical for residential lots in the area.
   • When a lot is substantially larger than what is normal for the neighborhood, a carve-out is required. The site value (THSC) to be used in the price differential will include the following:
     1. Acquisition price of the residential structure;
     2. Acquisition price of that portion of the acquired land which represents a typical lot size in the area. The unit price of the land will be a prorated value of the appraised amount. For example, if the land value for 20 acres was $100,000.00, then a carve-out would use $5,000.00 per acre as the unit price.;
     3. Value of any improvements related to normal residential occupancy (e.g., garage or tool shed);
     4. Amount of any damages attributable to the residential portion of the property.
5. The displacement site contains a major exterior attribute not commonly available in the marketplace.
   • If the acquired site is improved with a major exterior attribute, such as a swimming pool, work shop, etc., the appraised value of the improvement shall be carved out from of the FMVE when computing the price differential.
6. The replacement site chosen by the Displaced Person is not a typical single family residence.
   • If a purchased replacement property includes more than one residential unit, or any land area or building/improvement is used for non-residential purposes (business, farm or non-profit organization), that portion of the purchase price that is not attributable to the owner-occupied residential unit must be carved out before finalizing the calculation for the Replacement Housing Payment. This provision must be fully explained to the Displaced Person prior to their purchase of a mixed use or multi-family dwelling. It is the agency’s responsibility to allocate values for all non-residential portions of the replacement parcel. This should be done using standard appraisal methods and by an agency employee with appraisal experience.

6605.02 Adjustments to Carve-Outs -- Administrative or Case Settlements

The Typical Home Site Computation (THSC) value must be revised if the acquisition price changes after the original carve-out was computed, due to an administrative or case settlement. There are two methods to adjust a carve-out based on an increased acquisition price: Either through applying an adjustment factor formula or by using actual figures contained in the administrative or case settlement.

1. Actual Figures
   • Actual figures is just as it sounds: The Relocation Agent must read the administrative or case settlement write up and extract from it the allocated figures used to increase the acquisition price.

Example:

Original FMVE was $165,000, of which $25,000 was allocated for an in-ground pool. The Relocation Agent knew they would not be able to find comparable properties with in-ground pools in the marketplace, so they elected to carve-out the value of this “major exterior attribute.” This left a Typical Home Site Computation of $140,000. This is the amount the Agent used to compute the Owner-Occupant’s Replacement Housing Payment Offer.

Through on-going acquisition negotiations, the Acquisition Agent sought and received approval for an administrative settlement of $20,000 for a total acquisition payment of
$185,000. In the administrative settlement write up, the Acquisition Agent specifically stated the extra payments were $15,000 for the residential portion of the site, and $5,000 was additional compensation for the in-ground pool.

Thus, the final carve-out was increased to $30,000 ($25,000 original appraised value of the pool, plus $5,000 administrative settlement amount), and the final THSC would be $155,000 ($140,000 from the original THSC and $15,000 from the administrative settlement).

If there are specific amounts stated in the administrative or case settlement, they must be used to adjust the THSC and carve-out amounts.

2. Adjustment Factor Formula
   • In instances where the administrative or case settlement write up does not contain specific dollar amounts allocated to features of the acquisition site, the Relocation Agent must apply an adjustment factor formula to the final acquisition price to revise the THSC and carve-out amounts.
   • Such adjustment will be made using the following formula:
     • Formula:
       1. Carve-Out Amount ÷ by Original FMVE = Adjustment Factor Percentage
       2. Final Acquisition Payment x Adjustment Factor Percentage = Adjusted carve-Out Amount
     • Example:
       1. $10,000 Carve-Out ÷ $150,000 FMVE = 6.7% Adjustment Factor
       2. $200,000 Final Payment x 6.7% = $13,400 Adjusted Carve-Out

In this example the new price differential would be calculated based on the actual final acquisition payment ($200,000.00) less the adjusted carve-out ($13,400.00) to arrive at the revised THSC of 186,600.00

If the administrative or case settlement price increase is attributable only to the land or improvements that were carved out of the original FMVE, then an adjustment will not be made to the THSC.

Example:

Original FMVE was $120,000.00 and a pole barn valued at $10,000.00 was carved out for a THSC of $110,000.00. An administrative review was granted based on owner presented information that valued the pole barn at $15,000.00. Thus, the final acquisition payment would be $125,000 with a carve-out of $15,000.00, and the THSC would remain unchanged at $110,000.00.

6605.03 Damages

When a carve-out is necessary and the acquisition is a partial take, and the FMVE contains “damages” to the residue, the value of those damages is carved out of the THSC -- unless the damages are attributed to a residential feature of the displacement site.

For example: Damages would be included in the THSC if the damages were attributable to a residential garage that was not in the take. In this situation the value of the damages would be included in the THSC and the search for a comparable property would include residential sites with a similar garage.

6606. Additional Rules Relating to Replacement Housing Payments

6606.01 Joint Residential and Business Use

In the case of joint residential and business use, Displaced Persons who occupy quarters on the same premises as a displaced business, farm or non-profit organization are considered separate relocation units for the purposes of determining eligibility for relocation payments. All land and improvements which are used for non-residential purposes must be carved out of the FMVE and a THSC completed prior to the price differential being calculated.

For example, it would be considered two relocation parcels if an owner was displaced from a building which housed a barber shop on the first floor and the owner lived on the second floor. The barber shop would be considered a non-residential (business) parcel and be afforded all benefits which relate to a non-residential displacement. The business portion of the property would be carved out and the remaining residential portion would constitute a residential parcel which would be afforded all benefits which relate to a residential displacement.

6606.02 Multiple Occupancy

If two or more families occupy the same dwelling as a family unit, the occupants are usually entitled to only one replacement housing or rent supplement payment. However, should each family maintain complete and separate dwelling units within the dwelling, without any commingling of domestic obligations and duties, then each family unit could be considered a distinct and separate relocation parcel entitled to individual relocation assistance payments. This information is normally determined during the Pre-Acquisition Survey and unit parcel numbers assigned accordingly. However, if this situation should not be determined until the initiation of negotiations, the file should be so documented and the individual unit parcels identified accordingly.

The following conditions apply to making determinations and processing payment claims for multiple occupancy:

1. If two or more occupants of the displacement dwelling maintained a single household and they move to separate replacement dwellings, each will receive a prorated share of the total relocation payment(s) allowable.
2. If two or more occupants of the displacement dwelling maintained separate households within the same dwelling, each is entitled to individual relocation payments.
   1. The replacement housing payment will be based upon housing comparable to the quarters privately occupied by each displacee plus a prorated portion of any shared community rooms.
   2. The District Real Estate Administrator may determine that separate households are to be maintained when:
      1. Two or more distinct family units share a dwelling; or,
      2. Two or more unrelated persons divide rent and expenses on a prorated basis while maintaining lifestyles independent and exclusive of one another; or
      3. A person rents a sleeping room within a dwelling.

If the District Real Estate Administrator determines that individuals within one displacement dwelling are to be treated as separate relocation units they must create a memo to file that clearly sets forth the information they used to make their determination, and details the prorated living space to be allocated to each relocation unit.

6606.03 Fractional Owner

When a single family dwelling unit is occupied by a fractional owner, that occupant must spend their share of the acquisition price plus the amount of the Agency’s price differential in order to receive the full amount of that offer. The following example, which assumes four owners, one of whom occupies the dwelling, illustrates how a replacement housing price differential and payment are to be calculated:

Any DS&S dwelling purchased for $18,000 or more will allow payment of the full differential amount to the Displaced Person.

A fractional owner occupant of 90 days or more is also eligible for reimbursement of costs incurred in obtaining a mortgage where such financing is necessary to obtain replacement housing. There is no requirement for the fractional owner to have had an existing mortgage on the displacement site to qualify for this payment.

In situations where more than one of the fractional owners resides at the displacement site, and all Displaced Persons relocate together, they will receive the full amount of the relocation offer if the cost of the replacement dwelling meets or exceeds the total of their combined FMVE interests and the offered Replacement Housing amount. If the parties elect to purchase separately, they may only receive a prorated share of the computed relocation differential payment.

6606.04 Life Estate Displaced Person

A Life Estate is a person’s legal right to occupy a property until they die, at which time the right is transferred to the fee owner(s). A Displaced Person holding a Life Estate has several options. It is the Relocation Agent’s responsibility to explain all options fully to the Displaced Person prior to them making a decision. A Life Estate is basically a fractional ownership. It is important that the appraisal process breaks out the life estate interest. The following options are available to the displaced life estate holder.

1. The fee owners may transfer fee simple ownership to the life estate holder. This should be done prior to the appraisal and must be done prior to the initiation of negotiations. This allows the Displaced Person to be treated as a 90-Day owner occupant. It is entirely up to the Displaced Person and the fee owners to decide pursue this option.
2. The life estate holder may choose to be treated as a fractional owner (see Section 6606.03). The amount of FMVE allocated to the life estate holder’s interest, as determined by the appraisal, would determine the amount needed to be spent on a replacement dwelling in order to receive the total relocation price differential.
3. The life estate holder may choose to be a tenant in a replacement dwelling. An economic rent would be needed in order to calculate the rent supplement offer.
4. If the above options are not selected. The agency may choose to purchase a comparable replacement property and provide the Displaced Person with a life estate.

Situations involving life estates are often complicated and time consuming. Project management must be made aware of life estate situations as soon as they are discovered. The parcels should be prioritized when appraisals are scheduled. As necessary, ODOT Central Office should be contacted for advice and guidance when a life estate owner is displaced.

6606.05 Owner Retention

When an owner-occupant retains ownership of his or her dwelling, moves it from the displacement site and reoccupies it on a replacement site, any eligible costs incurred that are in excess of the acquisition price are reimbursable up to the full relocation entitlement amount established by the prime comparable.

The calculated “replacement purchase price” of the retained replacement dwelling shall be the sum of the following:

1. The cost of moving and restoring the dwelling to a condition comparable to that prior to the move. A reasonable cost amount will be established by securing at least one bid/estimate from a reputable house mover. The bid/estimate will be based upon detailed specifications which shall include all of the work necessary to reestablish the dwelling at the new site in a condition or configuration that is DS&S. Improvements made to the retained structure that are “betterments” (beyond the original condition of the home at the displacement site) are not eligible reimbursement cost items.
2. The cost of making the dwelling DS&S, including any required code improvements.
3. The purchase price of the replacement site (land). If the Displaced Person moves the home to the residue or to land they previously owned, the current FMVE for residential use of the replacement land shall be included. The provision to use the current FMVE for residential use does not mean the Agency must have the property appraised, instead any reasonable method for arriving at the fair market value may be used. The Relocation Agent should confer with the District Real Estate Administrator and/or District appraisal staff to establish the value of the replacement land.
4. Incidental costs incurred in the purchase of a new site, if applicable.
5. The retention (salvage) value of the dwelling. This is the amount that the owner- occupant pays the Agency to retain the dwelling structure.
6. Costs of necessary permits.
7. The cost for normal residential appurtenances and landscaping that were similar to the acquired site (e.g., driveway, sidewalks, mailbox, shrubs, grass, etc.).
8. Any other necessary costs directly related to the move and reestablishment of the dwelling incurred by the Displaced Person, which were not specified in the bid/estimates.

As noted above, in order to receive any portion of the relocation housing differential, the total costs incurred must exceed the acquisition price the Agency paid for the displacement dwelling, and reimbursement may not exceed the entitlement amount established by the prime comparable.

Any relocation parcel involving owner retention should be closely monitored from inception through completion by the District Real Estate Administrator.

6606.06 Owner of Displacement Dwelling

A Displaced Person is considered to have met the requirement for ownership of a displacement dwelling if the person holds any of the following interests in real property which is acquired by the agency:

1. Fee title, a life estate (see Section 6606.04), a land contract, a 99 year lease (or any lease with at least 50 years to run from the date of acquisition).
2. A partial interest in the real estate (see Section 6606.03).

6606.07 Purchase of the Replacement Dwelling

A Displaced Person will have met the requirement to purchase a replacement dwelling if they do any of the following:

1. Purchases a decent, safe and sanitary dwelling;
2. Purchases and renovates a substandard dwelling. For the purposes of this Section, substandard is defined as non-DS&S (see Section 6115.08). When a Displaced Person purchases and renovates a substandard dwelling, the cost of the renovations are added to the purchase price to compute the price differential payment (see Section 6606.17);
3. Relocates the displacement dwelling (see Section 6606.05).
4. Constructs a dwelling or contracts for the purchase or construction of a dwelling on a site provided by a builder, or on a site the person owns or purchases (see Section 6606.09).
5. Currently owns a previously purchased dwelling and site (see Section 6606.09).

6606.08 Occupancy of Dwelling

A displaced tenant or owner is considered to occupy a replacement dwelling only if the Displaced Person has moved to the replacement dwelling and that dwelling becomes their permanent place of residence.

A person is only eligible for a Replacement Housing Payment if that person is displaced from their permanent place of residence. If a person is displaced from a second home, such as a seasonal home or vacation home, they are eligible for a Personal Property Only move. Likewise, if a seasonal or migrant worker is displaced from a temporary residence, rather than their permanent place of residence, they are only eligible for reimbursement to move their personal property. See Section 6512 for Personal Property Only Moves.

To determine if the displacement or replacement dwelling is a person’s permanent place of residence, the follow factors must be considered:

1. The amount of time during a typical year that the Displaced Person resides in the dwelling;
2. Other pertinent factors such as voting records, taxing address, driver’s license, etc.
3. If the person resides separately from their family unit (e.g., lives in an apartment during the week to be closer to their work location), the dwelling in which the family resides would be considered the permanent residence.

6606.09 Legal Possession of Replacement Dwelling or Land Either Before or After Displacement

Any person who, prior to the initiation of negotiations, obtained legal possession of a replacement dwelling or land upon which a replacement dwelling is to be constructed, and occupies that DS&S replacement dwelling after being displaced (within appropriate claiming time frames), is eligible to receive a Replacement Housing Payment.
 
The current fair market value of the replacement site will constitute the “actual cost” in the Replacement Housing Payment computation. The Agency is responsible for establishing and documenting the current FMVE of the replacement dwelling. An actual appraisal is not required to document the current FMVE. For example, the County Auditor’s appraised value on the tax card may be utilized to establish that a Displaced Person spent the funds required to qualify for the replacement housing payment.

It is highly recommended that an appraisal be used to establish the replacement site’s FMVE if the Displaced Person will not be receiving the total price differential offer.

Any incidental expenses incurred in the purchase of the replacement site, which occurred prior to the initiation on negotiations, are ineligible for reimbursement, unless it is determined the purchase was in direct response to the project.

6606.10 Subsidized Housing

Special care must be exercised when a highway project displaces tenants from subsidized housing.

1. When a person is displaced from government subsidized housing and relocates to other qualifying public subsidized housing there will be no rent supplemental computation as long as the Displaced Person is able to transfer their rent subsidy to the replacement dwelling and their actual rent payment remains the same. As with other subsidized housing, a Displaced Person who participates in the U.S. Department of Housing and Urban Development’s (HUD’s) Housing Choice Voucher Program, previously known as “Section 8 Housing,” is not eligible for a rent supplemental payment, as it would be a duplication of payments from what HUD and the local Public Housing Authority (PHA) are providing to the tenant.
   • However, the Displaced Person is still eligible to receive the following:
     1. Actual move payments
     2. Advisory services, including referrals
2. In the event a Displaced Person, who was not originally in subsidized housing, moves into a dwelling in a government housing assistance program, the actual rental rate for the replacement housing is to be used in the computation of the rent differential payment. However, the initial relocation offer must be based on non-subsidized housing that is available on the open market, as the displacement was not from government subsidized housing.
   1. In most instances, the rental rate for replacement subsidized housing will be based on 30% of the Displaced Person’s income, with the local PHA paying the remainder of the full fair market contract rent. Subsidized housing rent calculations include utilities in the tenant’s total benefits, whether the landlord pays them or the tenant is billed for them directly.
   2. The Relocation Agent must know exactly what the Displaced Person in subsidized housing is paying versus the contract rent, as the Agency cannot duplicate payments received from other governmental agencies. If the Displaced Person cannot provide the amount of their actual rental payment versus the contract rent, the Agent should contact the landlord and/or local PHA to verify the actual rental. Verification can take the form of a copy of their HUD voucher, cancelled check, lease/rental agreement or other written evidence.
3. In all subsidized housing displacements the Relocation Agent is required to provide comparable replacement housing referrals. Although the PHA’s typically maintain a list of available subsidized rentals, it is still the responsibility of the Agent to provide rental referrals to those Displaced Persons who request them.
   1. To determine the type of properties to use as referrals, the Displaced Person must provide a copy of their most current Housing Choice Voucher or documentation verifying that an expired voucher has been extended. If the Displaced Person is unable or unwilling to supply a copy, the Agent must obtain a copy from the landlord or the local PHA administering the program.
   2. The HUD Housing Voucher Program is based on a total bedroom count. The bedroom count is used by HUD in establishing the amount of assistance the Displaced Person receives. If the Displaced Person moves into the same size replacement property their actual rental amount will stay the same.
   3. When looking for comparable referrals, the Agent must search for replacement housing that will accept a Housing Choice Voucher. In addition to the local PHA, a good place to search for referrals is the HUD rental selector web site (http://www.hud.gov/apps/section8/index.cfm). This web site provides current listings of available houses and apartments that accept Housing Choice Vouchers.
4. It is the Displaced Person’s responsibility to immediately contact the PHA when the Agency establishes their relocation eligibility so the PHA can begin the process of transferring their Housing Choice Voucher to a replacement rental. The Agent should assist the Displaced Person in explaining to the PHA why the tenant is being relocated and the timing for the project. Most PHA’s have a priority list for subsidized housing that makes allowances for individuals who are involuntarily relocated, and the Displaced Person is put at the top of the list for available rentals.
5. HUD and the local PHA’s contract in advance with landlords on qualifying rentals. Through their qualifying process, HUD determines if the rental housing is DS&S. HUD defines standard housing as meeting minimum quality criteria, as established by their Inspection Checklist (form HUD-52580). Only DS&S properties are allowed to participate in the program. When a Displaced Person moves into a HUD qualifying property, and the Agent secures a copy of the HUD inspection form for the replacement property, there is no need to perform a subsequent DS&S inspection and no RE-616 Dwelling Inspection form will be prepared. However, if the Agent has any concerns about the condition of the replacement property they may choose to inspect the property prior to processing payments. If the Agent does perform their own DS&S inspection they are to complete the RE-616 form.
6. If a person displaced from subsidized housing choses to leave the PHA’s program, the Agent must compute a rent supplemental differential just as with any other non-subsidized rental property. In these instances the Agent shall:
   1. Create a memo to file that clearly explains the Displaced Person voluntarily left the subsidized housing program and will not be entitled to any future housing payments from the PHA, and thus they are eligible for a rent supplemental payment.
   2. Obtain written documentation from the PHA confirming the Displaced Person has left their housing program.
   3. Establish an economic base rent for the displacement site if the rental rate is less than the market rent.
   4. Locate comparable housing and determine the rent supplemental offer.
   5. Provide the Displaced Person with written notification of the amended offer, including the newly determined benefit.
   • Since the relocation offer is being amended to accommodate the Displaced Person’s decision to leave the PHA’s program, the amended offer will not constitute a revised offer and therefore the 90-Day notice presented in the original offer will still be in effect.
7. A Displaced Person who occupied subsidized housing and whose rental supplement is computed to be zero (based on returning to PHA housing), who elects to purchase a replacement home would qualify for down payment assistance of up to $7,200.00.

6606.11 College Students

College students are treated the same as any other Displaced Person, provided basic eligibility requirements are met. A full-time student is assumed to be a dependent and not eligible for the 30% of income approach unless the Displaced Person can demonstrate otherwise.

6606.12 Advance Relocation Payment in Condemnation Proceedings

An advanced relocation payment may be made to a Displaced Person when a condemnation proceeding is initiated by the agency. The Joint Stipulation Form (RE-JS) will be used to document the terms and conditions of the advance relocation payment. To meet the full intent of the Uniform Act, eligible owner-occupants shall be offered an advance Replacement Housing Payment on all appropriation cases that involve a residential displacement. Such advance payment will be calculated utilizing the Agency’s deposit with the Court as the acquisition price. The advance payment of a replacement housing additive must be coordinated through the Assistant Attorney General handling the appropriation case, and prior to processing any claim for an advance Replacement Housing Payment, all of the parties must sign the stipulation and agree to the terms and conditions of the advance payment, including the Agency’s right to recover any excess payment should the final court award be higher than the deposit. If the displacee does not agree with the terms of the Joint Stipulation Agreement, the Replacement Housing Payment will be deferred pending final adjudication or a case settlement.

If there was a carve-out necessary on the original relocation offer, then the Form RE-JS-THSC shall be used to set forth the terms and conditions of the advanced relocation payment.

Upon final determination of the condemnation proceedings, the Replacement Housing Payment will be recomputed using one of the two methods set forth below:

1. On a total acquisition of a single family dwelling with no carve-out, if the court award exceeds the amount of the Agency’s deposit, then the recalculated Replacement Housing Payment will use the court award as the acquisition price.
2. On a parcel where a carve-out was necessary and a Typical Home Site Computation (THSC) was utilized, if the court award exceeds the amount of the Agency’s deposit, the recalculated Replacement Housing Payment will apportion the court award to the “typical home site” as outlined in Section 6605.02 “Adjustments to Carve-Outs.”

In either event, the Displaced Person must refund any excess advanced Replacement Housing Payment to the Agency, as applicable and called for in the Joint Stipulation Agreement.

6606.13 Administrative Review Procedure

When an Administrative Review is used to settle acquisition negotiations, a revised relocation offer must be presented to the Displaced Person to reflect the resulting change in the price differential brought about by the increase in FMVE. The Displaced Person must be informed in writing how the increased FMVE will affect the price differential offer and final Replacement Housing Payment. Likewise, additional FMVE for an owner via an appropriation case settlement or Administrative Review reduces their Rent Supplemental Payment, dollar-for-dollar, when the owner chooses to rent their replacement home.

If the original differential was based on a THSC (see Section 6605) and an administrative review results in an additional amount being allocated to residential structures, residential land or other specific residential areas of the acquired site, the increased acquisition payment will affect the computation of the price differential and the Replacement Housing Payment in the same manner as an award in a court case, with the end result being a proportionate reduction in the amount of the Replacement Housing Payment.

6606.14 Other Replacement Housing Options

Displaced Persons are not required to relocate to the same occupancy status. All housing options, such as relocation to a mobile home from a conventional dwelling, are open to them. However, all initial entitlement offers to Displaced Persons shall be based on their occupancy status at the acquired site.

6606.15 Building or Rehabilitating Housing to DS&S Standards Using Self Labor

When a Displaced Person elects to build a replacement dwelling or to rehabilitate a replacement home to DS&S standards using self-labor, it is necessary to secure documentation in order to verify the total cost of the replacement dwelling. The documentation includes, but is not limited to, the following:

1. Paid receipts for necessary materials used in the construction or rehabilitation of the replacement dwelling.
2. A detailed accounting of all labor costs, including:
   1. Time the Displaced Person spent in performing a task or trade on the construction or rehabilitation. The amount of time must be reasonable and no more than the amount of time professionals would spend completing the same task(s).
   2. Reimbursable hourly wage rates for the Displaced Person will be limited to the lessor of their actual hourly rate in their normal job, or the average professional tradesman’s wage for the same type of work in the area. When the actual employment rate is not found to be applicable (e.g., retired or unemployed) a wage rate may be established between the minimum and maximum tradesman rates for the work being performed. These situations must be preapproved in writing by the District Real Estate Administrator prior to the Relocation Agent providing the Displaced Person with an authorization to proceed with the work.
      • The area wage rates for the various types of work involved must be established by the Relocation Agent through contact with labor organizations, contractors, or labor web sites and must be fully documented in the file.
3. Equipment costs.
   1. Rates allowable for equipment owned by the Displaced Persons will be limited to the amount that would be required to rent similar equipment (per hour, day, week or month) and a reasonable amount to cover fuel.
   2. Rented equipment shall be reasonable for the type of work to be performed.
4. Proof of the current value of a residue plot or a purchased replacement lot, as applicable.

Following review of the documentation submitted by the Displaced Person, the Relocation Agent, with concurrence from the Relocation Reviewer, shall identify those costs that are eligible for reimbursement. Copies of the documentation shall be retained in the parcel file and the originals returned to the Displaced Person. A memo to file summarizing the eligible items and their amounts shall be prepared, approved and submitted to the Displaced Person for signature. The signed summary sheet then becomes a part of the supporting documentation for the billing package.

6606.16 Additional Improvements in Rehabilitating a Dwelling

Prior to any work being performed, the Relocation Agent must coordinate with the Displaced Person to prepare an approved list of DS&S deficiencies that would be eligible for reimbursement as part of the Replacement Housing Payment. Any improvements above those necessary to meet DS&S standards are not reimbursable.

6606.17 Displaced Person Enters Into a Contract for Construction or Rehabilitation of a Replacement Dwelling But Cannot Occupy Within the Time Period

A Displaced Person who has entered into a contract for the construction or rehabilitation of a replacement dwelling, and for reasons beyond their control cannot occupy the dwelling within the required one-year time period shall be considered to have purchased and occupied that dwelling as of the date of the construction contract. The Replacement Housing Payment under these conditions shall be deferred until actual occupancy occurs and the dwelling has been inspected and found to be DS&S.

6606.18 Inspection of Replacement Dwelling

Before making a Replacement Housing Payment or releasing a payment from escrow, the Agency or its designated representatives shall inspect the replacement dwelling and determine whether it is Decent, Safe, and Sanitary as defined in Section 6115.08. ODOT Form RE-616, Relocation Assistance Dwelling Inspection Form, is to be used by the Relocation Agent to document their inspection results. In addition, the Displaced Person must read the disclaimer and acknowledge their understanding by signing the RE-616.

The DS&S inspection is an administrative procedure accomplished solely for the purpose of establishing eligibility for the Replacement Housing Payment. It must be made clear to the Displaced Person that in no manner is this inspection made to warrant the property against defects for the Displaced Person.

If the Displaced Person wishes to have a professional home inspection, radon inspection, gas line or termite inspection completed as part of the replacement home purchase, reasonable fees not paid by the Seller will be reimbursed as incidental expenses.

6606.19 Occupancy of a Non DS&S Replacement Dwelling

Occupancy of a non DS&S replacement dwelling does not immediately disqualify that Displaced Person for a replacement housing payment. The Displaced Person shall be advised by letter as to the nature of the DS&S deficiencies. The letter shall state the Displaced Person has one year from the applicable date (see Section 6307.03) to correct the discrepancies or to occupy other housing that is DS&S in order to receive their Replacement Housing Payment.

1. Correction of the deficiencies may be made either by a contractor or by the displaced person using self labor. If a contractor is used, a paid bill itemizing the work performed shall be sufficient documentation to support costs incurred. If the Displaced Person elects to perform the work themselves, the method utilized to document self labor costs, as per Section 6606.16, shall be fully explained to the Displaced Person. The Displaced Person must be advised that all documentation must be submitted to verify costs. Costs are reimbursed only up to the amount of the original replacement housing offer.
2. A tenant occupant who elects to remain in non DS&S rental replacement housing shall be advised in writing that the deficiencies must be corrected either by the landlord or the tenant (at no cost to the Agency) within the specified time (see Section 6307.03) in order to qualify for a rent supplement payment.

6606.20 Payments Held or Reduced

Payments may be held or reduced as circumstances dictate. In cases of suspected fraud, or miscalculation of payments, relocation payments may be held or reduced. As soon as either of these circumstances is encountered, the Relocation Agent will immediately notify the District Real Estate Administrator who must take appropriate steps to resolve the situation. In a case where rent is owed to the Agency, no reduction is permitted; however, the Agency shall still pursue repayment, including use of the Attorney General’s Office for collections.

The Agency shall not withhold any part of a relocation payment to satisfy an obligation to any third party creditor.

6606.21 Duplication of Payments

If a Displaced Person receives a payment under any Federal, State or local law that is determined to have the same purpose and effect as the Relocation Assistance payment to which the Displaced Person was entitled, the Relocation Assistance payment shall be reduced by the amount of the other payment. For example, all or part of a Federal Housing Assistance payment received from the Department of Housing and Urban Development, payments from the Department of Health and Human Services low income energy block grant program, or Flood Insurance payments administered by the Federal Emergency Management Agency could all have the same purpose and effect as Uniform Act relocation assistance payments.

6606.22 Escrow Procedure

The escrow procedure allows for the processing of a billing package and the issuance of a warrant in advance of an actual closing for the purchase of a replacement dwelling or the finalization of a rental agreement/lease for a rental unit. This allows funds to be available for rental deposits, timely rental payments, down payments, etc., thereby eliminating the need for the Displaced Person to borrow funds in order to meet their financial responsibilities.

Escrow procedures are outlined below:

1. Displaced Person Who Purchases
   • An eligible Displaced Person who purchases a replacement dwelling may either assign their relocation assistance funds to a lending institution in advance of occupancy of the replacement dwelling or have the funds available at closing for the purchase. The Relocation Agent shall assist the Displaced Person in every phase of the purchase of the replacement dwelling, including explaining how the funds could be made available through the escrow procedure. The Relocation Agent will also explain the escrow/assignment procedure to the Displaced Person’s mortgage company and title company.
   • The billing package preparation will follow the normal process with the addition of a memo to file explaining the eligible costs and disbursement of funds in support of the escrow procedure. The payment may be split as necessary between the Displaced Person and the lender. Upon receipt of the warrant, the Relocation Agent shall advise the Displaced Person and make arrangements to attend the closing to deliver the warrant and to obtain copies of all pertinent documents (e.g., deed, closing statement, etc.). If the estimated amount that was either assigned to the mortgage company or taken to the closing by the Relocation Agent is incorrect (amounts can be adjusted from the estimate to actual closing statement) and this results in an overpayment, the Relocation Agent must obtain a check from the lending institution or title company, made payable to the Treasurer, State of Ohio, for the overage and immediately turn it in to the District billing staff upon return to the office. In addition, on those rare occasions where incidental expenses have been advance billed on the strength of a Good Faith Estimate of closing costs, and an overpayment occurs, an adjustment must be made at the closing and the overpayment recovered as detailed above. Because of the potential for problems associated with this type of payment, incidental expenses shall only be advance billed in cases of true hardship or extremely unusual situations.
   • A billing package for the amount of the eligible incidental costs and/or increased interest costs will be prepared and processed immediately following the final closing. In some instances, the increased interest payment will have already been made available to the Displaced Person.
2. Displaced Person Who Rents
   • When a Displaced Person rents a replacement dwelling, they may assign a part of the rent supplement to the landlord in advance of physical occupancy of that dwelling. The Relocation Agent shall assist the Displaced Person in every phase of the rental/leasing of the replacement dwelling, including explaining how the funds could be made available through the escrow/assignment procedure to a prospective landlord.
   • The billing package preparation shall follow the normal process, with the addition of a memo to file that explains the eligible costs and disbursement of funds in support of the escrow procedure. The payment may be split as necessary between the Displaced Person and the landlord. The portion of the payment assigned to the landlord shall be paid simultaneous with the occupancy date, and the Displaced Person’s portion shall be disbursed immediately after occupancy of the replacement site.

6606.23 Displaced Person Moves Out Of State

Should a Displaced Person move out of state, the District will continue to maintain contact with the Displaced Person for all follow up and claims. Should there be a need for official out-of-state documentation of any kind (e.g., economic rent, DS&S, etc.) the Relocation Agent should request written assistance from the respective State Department of Transportation. The ODOT Central Office Relocation Section is also available to assist with these contacts.

6606.24 Death of a Displaced Person

Should the death of an eligible Displaced Person occur at some point after the relocation offer has been made, the following guidelines dictate the method for disbursement of any supplemental payments to which the deceased person may have been entitled:

A supplemental payment is specific to the Displaced Person and upon their death the undistributed portion of such payment shall not be paid to the heirs or assigns, except that:

1. The amount attributable to the Displaced Person’s period of actual occupancy of the replacement dwelling 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 unit members that were relocated continue to occupy the replacement dwelling.
3. Any portion of a Replacement Housing Payment necessary to satisfy the legal obligations of an estate in connection with a contract for a replacement dwelling, by or on behalf of a deceased person, shall be distributed to the estate upon receipt of proper probate documentation.

In any event, the Relocation Agent should discuss the situation with the District Real Estate Administrator to make sure they are following proper procedures when a Displaced Person dies prior to completion of the relocation process.

6606.25 Conversion of Payment

A Displaced Person who initially rents a replacement dwelling and receives a rental assistance payment is eligible to receive a 90-Day owner Replacement Housing Payment or the down payment assistance payment, as applicable, if he or she meets the eligibility criteria for such payments. In order to qualify, the Displaced Person must purchase and occupy a replacement dwelling within the prescribed one-year period and the dwelling must be DS&S. Any portion of the rental assistance payment that has previously been disbursed shall be deducted from the final Replacement Housing Payment.

6606.26 Owner Occupant Purchases a Second, More Expensive Home within the One-Year Occupancy Period

If an owner occupant who has purchased and occupied a DS&S dwelling subsequently purchases and occupies a more expensive DS&S dwelling within the one-year occupancy period, they may present another claim for any amount still left in their original eligibility. The total of the original Replacement Housing Payment, and any subsequent payment, may not exceed the maximum amount of the originally computed Relocation Offer. In this situation the Displaced Person would not receive any move payment for the second move, nor any additional incidental or increased interest cost payments.

6606.27 Uneconomic Remnant

When a partial acquisition displaces a person from a residential dwelling, sometimes there is an uneconomic remnant which the agency is required to offer to purchase. This is often called an excess land or “E” parcel.

If an uneconomic remnant remains after a partial taking and the owner declines to sell that remnant to the Department, the fair market value of the remainder will not be added to the acquisition cost of the acquired dwelling for purposes of computing the Replacement Housing Payment.

If the owner sells the uneconomic remnant to the Agency, and the total acquisition area is typical for home sites in the area, then the Replacement Housing Payment is computed based on the total FMVE paid for the property.

If the owner sells the uneconomic remnant to the Agency, and the total acquisition area is larger than what is typical for home sites in the area, or the acquisition area possesses unusual exterior attributes or areas that are non-residential, a carve-out is performed before computing the Replacement Housing Payment.

6606.28 Subsequent Occupant

A Subsequent Occupant is one who moves into a structure after the initiations of negotiations and before the Agency obtains possession of the property. Where applicable, the acquiring Agency should enter into a protective rental agreement with the property owner to reduce the occurrence of Subsequent Occupants.

A Displaced person in this category is eligible to receive a rent supplemental determination; however, the rent supplemental price differential, regardless of the amount, will fall under the provisions Last Resort Housing due to the occupant’s length of occupancy.

The computation for the rent supplemental determination and payment are to follow the procedures outlined in Section 6603.
Subsequent Occupants are also eligible to receive down payment assistance, as outlined in Section 6603.10.

6606.29 Pets

The Relocation Assistance Program is not required to provide comparable replacement housing that accommodates pets. However, if a Displaced Person owns pets, the comparable replacement housing search should begin with properties that would allow pets. If such housing is not available, a unit that does not accept pets may be used as a comparable to compute a rent differential entitlement/relocation offer.

Additional monthly charges because of pets at either the displacement site or any of the comparable rentals will be disregarded when calculating a rent differential payment. However, an additional pet charge levied at the replacement site may be used to calculate the rent differential payment. As with any displacement, the rent differential payment may not exceed the originally calculated relocation offer.

6607. Replacement Housing of Last Resort

Replacement housing of last resort is a legislatively authorized supplement to the replacement housing assistance described in Sections 6602 and 6603. Last Resort Housing provides for comparable replacement housing for Displaced Persons when adequate housing cannot be provided under those Sections. It also provides for replacement housing for those who do not meet the eligibility requirements of those Sections (e.g., original site occupants of less than 90 days, subsequent occupants).

Additional flexibility is provided to displacing agencies via the provisions of Last Resort Housing so housing needs are met for owners and tenants in the most cost effective and equitable manner.

6607.01 Determination to Provide Housing of Last Resort

Whenever a project or program cannot proceed on a timely basis because comparable replacement dwellings are not available within the monetary limits for owners ($31,000.00) or tenants ($7,200.00), the displacing Agency shall provide additional or alternate assistance under the provisions of Last Resort Housing.

Any decision to provide Last Resort Housing assistance must be adequately justified. Justification may be on a case by case basis or for an entire project or program area.

1. A decision to provide Last Resort Housing on a specific parcel must be authorized in writing by the District Real Estate Administrator. Justification on a case by case basis means that appropriate consideration has been given to:
   1. The availability of comparable replacement housing in the project or program area; and,
   2. The resources available to provide comparable replacement housing; and,
   3. The individual circumstances of the Displaced Person.
2. A decision to provide Last Resort Housing for an entire project must be authorized by the ODOT Central Office Relocation Manager. All requests to provide Last Resort Housing provisions for an entire program area must be adequately justified by a determination that:
   1. There is little, if any, comparable replacement housing available to Displaced Persons within the entire project or program area, thus Last Resort Housing assistance is necessary for the area as a whole; and,
   2. A project or program cannot be advanced to completion in a timely manner without Last Resort Housing assistance; and,
   3. Last Resort Housing assistance is cost effective, considering all other elements that contribute to total project or program costs. For example, additional construction costs caused by project delays while waiting for less expensive comparable replacement housing would exceed the anticipated costs of Last Resort Housing.

6607.02 Basic Rights of Persons to Be Displaced

1. No person shall be required to move from a displacement dwelling unless at least one comparable replacement dwelling is available to them. No person may be deprived of any rights they may have under the Uniform Act, Ohio Revised Code or Ohio Administrative Code.
2. Any person displaced because of the acquisition of real property for use in a Last Resort Housing project (meaning the Agency is acquiring property to provide adequate replacement housing for Displaced Persons from a highway project) under the Agency’s power of eminent domain, including amicable agreements under the threat of such power, is entitled to all relocation benefits for which they are eligible under the relocation assistance program. Any tenant of such property is eligible for relocation payments and assistance providing they meet all normal eligibility requirements. Conversely, this provision is not applicable to an owner occupant who voluntarily acts to sell their off-project property (such as a home being actively listed and marketed for sale) to the Agency for Last Resort Housing use and certifies such in a statement maintained in the Agency’s files.

6607.03 Methods of Providing Last Resort Housing

Last Resort Housing must be cost effective, considering all elements which contribute to total project or program costs. Thus, to be cost effective, the Relocation Agent must use the lowest price comparable property as their prime comparable when calculating a replacement housing payment determination under Last Resort Housing.

Agencies shall have broad latitude in implementing the provisions of Last Resort Housing.

1. The methods of providing replacement housing of last resort include, but are not limited to, the following:
   1. Rehabilitation of and/or additions to an existing replacement dwelling.
   2. Construction of a new replacement dwelling. 
   3. The relocation and, if necessary, rehabilitation of a dwelling.
   4. The purchase of land and/or a replacement dwelling by the displacing Agency and the subsequent sale or lease to, or exchange with, a Displaced Person.
   5. The removal of barriers to the handicapped. Those costs necessary to make the replacement site handicapped accessible are reimbursable under the provisions of Last Resort Housing and are in addition to a Rent Supplemental or Replacement Housing Payment. These costs must be actual, reasonable and necessary costs. For example, the costs to widen doorways to provide handicapped accessibility are reimbursable. Costs to install an elevator in a two story home may not be necessary when ample supplies of one story homes are currently available on the market.
   6. A Replacement Housing Payment in excess of the statutory limits. A rental assistance subsidy under this Section will be made in a lump sum to the Displaced Person if it is $12,000 or less (see Section 6603.07). Last Resort Housing Rental Assistance supplements of over $12,000 will be disbursed to the Displaced Person in quarterly installments until the balance is reduced to $12,000 or less, then the balance will be paid to the Displaced Person in a lump sum.
   • The most cost effective means of providing comparable replacement housing is implied throughout this program. While innovative means to provide housing are encouraged under Last Resort Housing, they should be cost effective. It is anticipated that payment in excess of the statutory limits (item No. 6 above) will be the most commonly used method for providing Last Resort Housing.
2. Under special circumstances, modified methods of providing replacement housing of last resort permit consideration of replacement housing based on space and physical characteristics different from those of the displacement dwelling. These may include upgraded, but smaller, replacement housing that is DS&S and adequate to accommodate individuals or families displaced from marginal or substandard housing with probable functional obsolescence. However, in no event shall a Displaced Person be required to move into a dwelling that is not functionally equivalent (see Section 6115.19) to the displacement dwelling. This permits use of Last Resort Housing which may, in special cases, involve variations from the usual methods of determining comparability. Such variation should never result in a lowering of housing standards, nor should it ever result in a lower quality of living style for the Displaced Person. The physical characteristics of the comparable replacement dwelling may be dissimilar to those of the displacement dwelling, but they may never be inferior.
   • For example, the Relocation Agent may use new manufactured housing to replace a very substandard conventional dwelling in an area where comparable conventional dwellings are not available. Another example would be the use of a superior, but smaller DS&S dwelling to replace a larger, old substandard dwelling, only a portion of which was used as living quarters by the occupants -- and no other large comparable dwellings are available in the area.
3. The displacing Agency shall provide assistance under the provisions of Last Resort Housing to a Displaced Person who is not eligible to receive a Replacement Housing Payment because of the person’s failure to meet length of occupancy standards. Section 6115.18(C) of this manual provides the following definition, “For a displaced person who is not eligible to receive a replacement housing payment because of the person's failure to meet length of occupancy requirements, comparable replacement rental housing is considered to be within the person's financial means if an Agency pays that portion of the monthly housing costs of a replacement dwelling which exceeds the persons gross monthly rent for the displacement dwelling as described in section 6603.04. Rental assistance paid under this part must be paid under Last Resort Housing provisions.”
   • Therefore any person displaced from a dwelling (owner or tenant) who does not meet the length of occupancy requirements discussed in Sections 6602 and 6603 is eligible for a rent supplement payment or down payment assistance. The only difference between a Displaced Person that meets the length of occupancy requirements and one that does not is that the payment to the latter is paid under the provisions of Last Resort.

6607.04 Authorization

The provisions of Last Resort Housing shall only be used when necessary to move a project forward on a timely basis. All requests for individual parcel Last Resort Housing must be submitted in writing and approved by the District Real Estate Administrator. All requests for the use of Last Resort Housing on an entire project or program must be submitted in writing and approved by the Central Office Relocation Section Manager.

The Relocation Agent must request the use of Last Resort Housing whenever a replacement housing price differential will exceed $31,000.00, or a rent differential will exceed $7,200.00. The request shall include the RE-611, the site description, the comparable description, the site/comparable analysis (see Section 6604.05), the RE-612 (as applicable) and all other relevant documentation. The Relocation Agent will create a detailed “memo to file” explaining:

1. The necessity for Last Resort Housing;
2. How a reasonable search was performed (see Section 6604.03);
3. How the provisions of Last Resort Housing are being used to ensure the housing needs are being met for the owner or tenant in an equitable and cost effective manner.

The request and all documentation must be submitted to the Relocation Reviewer for approval. After approval, the Relocation Reviewer shall submit the request to the District Real Estate Administrator (on individual parcel requests) or to the Central Office Relocation Section Manager (on project-wide requests) for final approval. On LPA projects, the District Real Estate Administrator shall process all requests (parcel or project) for Last Resort Housing. All Last Resort Housing requests will be approved in writing and the approval memo will be kept in all parcel files where the provisions of Last Resort Housing are used in computing the replacement housing differential.