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National Business Relocation Study

VII. Rhode Island Pilot Program

The Rhode Island Pilot Program was designed to address the pervasive allegations that Uniform Act benefits for relocated businesses were not adequate to reasonably provide for successful business relocation. Earlier studies identified these issues. FHWA Division offices had also expressed concerns about the adequacy of these payments. FHWA was also aware that some states had expanded the benefits available to businesses to remedy some of these alleged inadequacies. FHWA desired to examine this issue in a controlled limited environment.

In 1999, Rhode Island volunteered to assist FHWA in evaluating the impact of enhanced provisions for moving and reestablishment payments for businesses. Rhode Island was about to undertake a realignment of I-195 through a predominantly industrial area. Since this project had a limited scope and Rhode Island had no other similar projects in its plan, the project lent itself to some experimentation. Also, Rhode Island wanted to retain as many of the displaced businesses as possible and agreed to provide the cost of enhanced benefits.

FHWA and Rhode Island jointly developed a set of interim regulations, drawn from various non-federal experiences with enhanced benefits. The interim regulations also addressed concerns particular to Rhode Island, based on the state's 30-year experience under the Uniform Act.

These interim regulations essentially expanded the amount of money available for business reestablishment. Three benefit categories were removed from their traditional niche as cost-limited reestablishment items, and re-characterized as more generous, cost-capped moving payments. The eligible items are:

  1. Repairs and improvements required by law;

  2. Modifications to accommodate the business; and

  3. Estimated increased operating costs for the first 24 months.

These three items were capped at a maximum of $75,000. At its discretion, however, Rhode Island could limit reimbursement at a lower level if it deemed that reestablishment expenses could be held below the maximum allowed. The modified provisions also moved the category of "impact fees" into a separate category capped at $25,000. This item formerly was one of 13 identified reestablishment costs within the $10,000 cap.

The former cap of $1,000 for search expense was removed and replaced with an "actual cost" benefit. The controls on this payment were those deemed reasonable and necessary by the agency. FHWA also monitored the project's activities to assure uniformity and consistency of treatment. The actual implementation of these interim regulations required ad hoc interpretations and adjustments.

ANALYSIS OF THE PILOT PROJECT ELEMENTS
The Rhode Island Pilot Project represented an innovative attempt by FHWA to look at various alternative approaches to business relocation. As of February 2002, only a few significant parcels are outstanding and it is possible to estimate the total cost of the program. This estimate can be viewed both in terms of its actual cost (including expenditures for all Pilot Program authorized costs) and the cost that would have been incurred if only traditional benefits had been paid.

The total relocation cost to February 2002, including Pilot Program cost is $4.75 million with an estimated cost-to-complete of another $2.6 million. This would indicate an estimated total relocation project cost of $7.35 million at completion. The Pilot Program costs are estimated at completion to be just over three million dollars ($3.064 million) out of the total project relocation cost of $7.35 million.

The following is a short summary of each of the various payments provided under the Rhode Island Pilot Program.

Advisory Services:
Present Program:   Offered without limitation to all displacees
Pilot Program:   Offered without limitation to all displacees

The Pilot Program was intended to have "enhanced" advisory service standards. However, the general consensus of all parties involved was that the advisory services were not significantly improved. The enhanced services were an attempt to provide meaningful services such as listings of replacement property, zoning assistance, etc. All relocated businesses interviewed acknowledged assistance was offered and the parcel files indicated advisory assistance was provided. But it appears that the value of the assistance to the businesses was limited. In some instances, businesses' expectations for help were not met. As is frequently the case, the substance and quality of the assistance a business might expect to be available was often outside the purview and expertise of the relocation personnel.

Search Expenses:
Present regulations:   $1,000 maximum based on actual costs
Pilot Program:   No limit, based on actual cost

The search expense has been limited by regulation to a $1,000 maximum reimbursement. Most organizations conducting relocation programs assume a business will easily incur at least $1,000 in real search costs. Documentation required to claim the current capped amount is typically minimal. The Pilot Program removed the cap and determined the payment based on actual cost.

The opinion of those conducting the Pilot Program was the uncapped amount of search expense tended to lead to overstatement of the real time spent seeking relocation sites. Additionally, the administrative time to review and research the claims grew substantially, far exceeding that which is required under the present regulations. The Pilot Program dealt with several claims that were large and were deemed to be excessive. The general feeling of those administering the program was that a new limit, perhaps between $2,500 and $5,000, might be more appropriate and manageable from an administrative viewpoint than the uncapped amount. Staff also recommended that FHWA be more precise in defining "search expense," especially in determining if the reimbursement is limited only to finding a potential replacement location or if it includes finding and making "ready" such a location that involves zoning hearings, variances, etc.

Additional Moving Expenses
Present Program:   These costs are considered to be part of the reestablishment cost.
Pilot Program:   These costs have been removed from the capped category of reestablishment costs and re-characterized as moving costs.

The Pilot Program removed from reestablishment the categories of:

and re-categorized them as moving costs with an aggregate cap of $75,000. The increased operating cost payment was further limited by what a comparable (i.e., adequate to meet the needs of the business) replacement property would cost the business.

These payments worked well on this project and were the centerpiece of the Pilot Project's adjustments. The three areas addressed by these payments represent the most difficult cost issues for a relocating business; by addressing them; the Pilot Program overcame the primary obstacle to successful relocations.

The only criticisms of these payments were they tended to overcompensate very small businesses. This was especially true in situations involving the provision that permitted tenant businesses to convert estimated increased operating costs into a down payment. However, in the cases where the down payment benefit was utilized, the business operators reported that they were pleased with the program.

The consultants operating the Pilot Program and state personnel agreed that determining a standard of measure to evaluate a comparable business property to the displacement property was difficult and problematic. Given the unique and particular nature of some of the businesses' requirements for a relocation site (i.e., zoning restrictions) the computation based on a "comparable" was highly subjective.

An additional payment to assist owners in purchasing a replacement location (a replacement business payment) was proposed for owner-occupant businesses in the pilot project regulations. This benefit was calculated but not paid as initially conceived. The concept of using a comparable replacement as a basis for a payment was found to have practical problems. It was subjective and the use of actual cost was found to be a more practical basis of payment.

Other Categories of Payment
Present Program:   Higher financing costs and closing costs are generally not reimbursable.
Pilot Program:   Increased mortgage interest costs and closing costs are reimbursable.

The Pilot Program permitted payment of various closing costs and increased mortgage interest payments incurred due to the relocation. However, during the period of the pilot project, mortgage rates were very low and no increased mortgage payments were made. There were various payments of closing costs for those persons buying replacement property, but none of these payments were unusual or significant.

This is a chart showing payments allowed under Moving and Reestablishment in the Traditional Program and comparing these to payments allowed for Moving, Supplemental and Reestablishment categories under the Pilot Program. The Supplemental Payments box shows that under the Pilot Program payments for repairs and modifications are capped at $75,000 and payments for environmental impact fees are capped at $25,000.

Rhode Island Pilot Project Synopsis
The realignment of I-195 and the construction of a new bridge over the Providence River caused the displacement of 76 businesses in Providence, Rhode Island. These businesses varied in size from one-person proprietorships to a 50+ employee manufacturing business. All of the businesses were considered "small business" for purposes of their eligibility for reestablishment benefits.Rhode Island Pilot Project Synopsis

The realignment of I-195 and the construction of a new bridge over the Providence River caused the displacement of 76 businesses in Providence, Rhode Island. These businesses varied in size from one-person proprietorships to a 50+ employee manufacturing business. All of the businesses were considered "small business" for purposes of their eligibility for reestablishment benefits.

The types of businesses moved were also widely varied. Sixteen of the businesses were artisans, i.e., jewelry makers, painters, etc. Six of the displaced businesses were non-profit organizations or associations. There were also ten product manufacturers and six professional service firms. The remaining businesses were predominately entertainment or other service firms.

The Rhode Island Department of Transportation (RIDOT) has a regular planned series of road improvements. RIDOT's real estate section conducts an ongoing acquisition/relocation program to meet the right-of-way demands for these public improvements. For the I-195 project, Rhode Island's real estate division chose to augment its staff by employing an outside consulting firm to provide real estate acquisition and relocation services.

The lead-time on this project varied by parcel requirements but generally, no unusual acquisition schedules were involved. Some businesses had up to one year of advanced notice of the pending displacement. Negotiations to acquire the needed real estate began in a timely manner and are continuing.

The quantity of available commercial real estate to replace that being acquired in the project area was adequate. Some concern arose because the long planning phase of the project and the attendant public information about the project most likely caused rental prices to stagnate in the project area, thus artificially reducing the cost of business for the subject firms. When required to move, the firms were required to compete in the unconstrained market. For example, at the time of relocation, rents at the #1 Allen Avenue Building, a multi-tenant parcel being acquired, were lower than other similar locations.

The project also caused some businesses to face zoning restrictions imposed by the city of Providence on some forms of adult entertainment. Relocation options for these businesses were more limited, causing them to pay much higher rents. Some are still not relocated.

After an approximate one-year effort to relocate all of the businesses, 68 of the 76 businesses have been relocated and are in operation. It is anticipated that all 76 of the businesses will eventually be successfully relocated.

Of the 68 businesses that have completed the relocation process, Rhode Island reports that all remain in business, albeit some with modifications to their operations.

Rhode Island I-195 Relocation Displacees - Industry Categories

Industry Group Number
arts - art studies, jewelry, dealers, theater 28
professional - architects, writers ect. 17
retail - sales to public excluding art 7
manufacturing - industrial/technical 12
organization - non profits and associations 5
entertainment - clubs & restaurants 5
other 2
Total 76

CASE STUDIES OF THE RHODE ISLAND PROJECT

The following are brief summaries of fourteen business displacements and relocations that occurred in the Rhode Island I-195 Pilot Project. The actual names of the businesses have been omitted. It should be noted that most of the businesses reported they were pleased with the program and services provided by the state. In-person and phone interviews were used to obtain their suggestions and comments for program improvement and even when the business owner reported they were satisfied, they were further queried to obtain their suggestions for program improvement.

  1. Courier Service
    This small business is a trucking and fast delivery service. The company occupied 25,000 square feet for $1,600 monthly rent including warehouse, truck garage and office space. The business moved to a building it purchased in Warwick, Rhode Island.

    The business' total relocation claim was $100,439. This included $75,000 paid as a rent supplement converted to down payment supplement. This payment was based on similar alternative space renting for $5.50/sf. The business was also reimbursed for $4,964 search expense and $20,475 personal property move cost.

    The owner was interviewed for this report. He stated he was searching for a location in Providence for this business. He said it had been a mistake to locate in Warwick, as most of his customer base is in Providence and he was not able to provide expected timely service. He had lost several good customers and could not afford to lose more. The owner said he had been fairly compensated for his business move and received good service from RIDOT and its representatives. He did not hold RIDOT responsible for his unfortunate location choice. The business anticipates another move in the near future to remain in business.

    The Pilot Program made possible the $75,000 of funding used by this business as a down payment. It also permitted reimbursement of the full $4,969 of search expense incurred as opposed to the current regulatory limit of $1,000.

  2. Consulting Firm
    This business is a human resources consulting firm engaged in organizational teamwork and group interaction. They conduct meetings and seminars on their premises and are able to provide food service at the site. The company occupied 6,000 square feet. They relocated to a building they purchased in Providence, Rhode Island.

    Rhode Island reimbursed costs of $99,935. This included $40,630 paid as a down payment supplement. The amount was determined as a rent differential for available space equal to the dislocation property. The amount of $34,370 was paid for building modifications, $9,463 for the remaining traditional reestablishment expenses, and $15,072 for personal property move cost.

    The chief executive officer of the firm was interviewed. He said he was pleased with the new facility. He felt the total compensation for the relocation was fair, although the company's total build-out costs exceeded the allowed reimbursement by about $9,000. There is still an unpaid claim for replacement stationery.

    The business was frustrated early in the process by receiving conflicting or incomplete advice by project staff concerning the eligible benefits. This was a period when this firm needed to make decisions about its future. However, it was also the same time period in which the Pilot Program was being developed. These matters were resolved as the relocation planning progressed.

    The Pilot Program provided funding for the down payment, as well as additional funds for modifications of the new facility to accommodate the business. These modifications did exceed the allowable cap of the Pilot Program.

  3. Design Studio
    This facility is an art and design studio occupying 1,800 square feet at the displacement location. The business is a sole proprietorship. The relocation need was for equal space that had high ceilings, good light and ventilation. The business relocated to rented space in an older mill building in Pawtucket, Rhode Island.

    The total relocation claim for the business is $69,377. This included $13,874 in personal property and related move costs, $47,873 in Pilot Program reestablishment costs and $7,630 in traditionally reimbursable reestablishment costs. There was no search expense claimed.

    This case began before the Pilot Program was defined. The owner had elected a fixed payment in lieu of actual cost claim, as she expected the necessary build-out costs at the replacement space and move costs could be paid within the $20,000 payment ceiling. During the renovation process, however, she encountered higher than expected costs to meet current code requirements for safety and disabled access. With cooperation of project relocation staff, she converted her relocation strategy from an in lieu payment to actual cost relocation with benefits enhanced by Pilot Program provisions.

    The owner was interviewed for this report. Her relocation is complete, but she described several frustrations along the way. She felt that coordination among project staff and explanations of the program were deficient, and this caused delays and increased renovation costs. She said a total of five agents communicated with her, and she received incomplete and conflicting advice. Also, she would have benefited from advisory assistance for contracting and renovations. For example, she did not learn that she would need to provide disabled access until after renovation work had begun. She was required to alter her plans and change some completed work.

    The owner related several sources of business loss as a result of relocation. As an example, she had hired interns from Rhode Island School of Design. The students were not able to make the commute from Providence therefore; she lost this source of labor. Also, she lost some business because of distraction, interruption of move and renovations.

    The owner also felt she incurred costs of lost business and downtime due to the move.

  4. Pewter Manufacturer
    This business is a family-owned jewelry and pewter manufacturer that occupied a 16,000 square foot structure at a building it owned in Providence. The displacement space consisted of manufacturing area, showroom and offices. The company moved to a building purchased in a nearby industrial park. The company employs about 200 people.

    The total cost reimbursed by the State was $335,625. This included $6,650 in search expense, $243,975 for moving and reinstalling personal property and equipment, $75,000 in Pilot Program reestablishment costs and $10,000 in traditional reimbursable reestablishment costs. The Pilot Program funds were spent on building modifications and the interior build-out to meet special needs.

    A vice president of the firm was interviewed. He said the move went as well as could be expected. He was appreciative of enhanced relocation program benefits. In the new location, the company has more efficient office space and the firm has consolidated some operations that were previously located off site.

    A move planner, who was reimbursed as part of the total moving costs, assisted the relocation.

    The business did not lose customers in the relocation and had minimal loss from interruption of jewelry production. The firm serves a trade clientele, and many customers deal with the company via telephone and fax. The company did incur significant costs that were not reimbursed. This includes about $30,000 in legal and transfer fees related to sale and purchase of real estate and diversion of time of employees engaged in planning and supervising the relocation. These costs are currently ineligible in the relocation program.

    The company estimates their total actual moving costs at approximately $446,000.

  5. Labor Union
    A labor union indicated they were pleased with the program, although they had about $115,000 of non-reimbursed cost. Project data indicates about $86,000 of this cost was eligible for reimbursement but exceeded the program limits. The union suggested higher limits in the program.

  6. Non-profit Advocacy Group
    A non-profit advocacy group indicated it would experience a $50,000 to $60,000 annual increase in operating costs due predominantly to higher rents required at the replacement location. The group was very concerned that their long-term viability was in question. The program payment for higher operating costs is limited to $75,000 or those costs incurred in the first 24 months, whichever is lower. They feel larger organizations may require greater assistance or that payments need to be specifically tailored to a business' requirement.

  7. Small Jewelry Manufacturer
    A small jewelry manufacturer indicated the program substantially met all of its costs. The owner did have several suggestions for modifying the program.

    • Use the "common sense" approach to the requirement for bids and estimates. Small jobs are not typically bid.

    • Do not second-guess the business as to its needs, such as the installation of a doorbell, the addition of sound attenuating materials and the move of various lighting fixtures.

    • Consider paying for "downtime" cost. He estimated his downtime loss at $4,000.

  8. Outdoor Advertising Company
    An outdoor advertising company indicated their replacement facility renovation costs were approximately $800,000 of which $75,000 was reimbursable. These modifications include those required by code as well as those needed for the operation of the business. The new facility was purchased by the business and is generally superior to the previous property. This business offered several improvement suggestions:

    • Better-trained relocation personnel.

    • More lead-time to plan.

    • Pay for downtime.

  9. Specialty Publisher
    A specialty publisher indicated that all of its costs had been reimbursed with the exception of its claim for searching costs. The state rejected the claimed cost but agreed to reimburse $5,951. The company disagreed with this rejection and offered suggestions that include:

    • Provide prepayment of agreed expenses; or pay interest if reimbursement is delayed.

    • Pay for move planning services or agree to pay the business owner for their time expended in this effort.

  10. Small Interior Design
    A small interior design office indicated nearly all of its costs to reestablish had been reimbursed with the exception of about $6,000 in material costs, which exceeded the program limits. Their suggestions for program improvement are:

    • Provide personnel more focused on business relocation.

    • More flexibility in the program.

    • Eliminate the need to obtain multiple bids for low cost items and services.

    • Permit the use of move planners.

    • Cover the cost of "false starts" (i.e., pay the costs incurred that do not result in a successful replacement location). These might include attorney's cost for unsuccessful lease negotiations or the cost to obtain estimates for refurbishment when the site is later abandoned.

  11. Small Advertising Firm
    A small advertising firm used part of its eligible benefits as a down payment. They were pleased to move from a tenant-status to an owner. They report only a negligible amount of unmet cost, principally downtime.

  12. Tool & Die Firm
    A tool and die firm indicated that $23,000 of cost were not addressed by the program. These were items desired by the business but not allowable in the program. For example, the business upgraded the heating system, which was determined to not be an allowable cost. They felt such costs should be permitted.

  13. Medium-size Engineering Firm
    A medium-size engineering firm indicated that it would experience a $41,400 annual increase in operating cost, which was partially reimbursed for the first two years. It has also calculated about $8,400 of downtime costs that were not reimbursable. Management's suggestions for program improvement were:

    • Pay additional payments when former location provided them a long-term, low-cost lease.

    • Pay for downtime.

  14. Real Estate Developer
    This business owner developed and managed the space in a large, multi-tenant structure on the subject project. Following displacement, he partnered with an owner of another large building capable of being subdivided to accommodate small business tenants. The replacement building, about 60,000 square feet, is now one-third occupied by business tenants displaced on the I-195 project. The interview with this owner provided insight into the Pilot Program from dual perspectives since he was both a displacee and a developer. His comments blend both perspectives.

    He believed most of the small businesses did well, "very well" in some cases. He believed the smaller the business, the better it came out in the program. He cited examples of various other circumstances such as the difficulties some of the entertainment businesses were having in finding replacement sites.

    He felt the program had to be more tailored to the individual situation as opposed to offering all businesses a flat amount. Those businesses requiring more extensive renovations, such as restaurants and bars (food handling) should be offered more assistance with their unique situations and higher costs. Also, he suggested some formula of cost sharing would lessen the incentive to "just spend" the money because it is available.

Relocation Summary - Rhode Island I-195 Pilot Project (as of Jan 2002)

number of displacees on project 76
displacees claims or estimates 68
number of pilot program recipients 49
number of traditional benefit only claimants 27
move benefits 16
in lieu 11

Pilot Program Recipients (49)

Average Pilot Program - total claim $68,480
Range of Pilot Program Costs $1,000 To $775,532

Traditional Program Amounts (applied to 69 pilot and non pilot recipients)

Average traditional amount $35,484
Average traditional amount-excluding 11 In lieu claims $39,185
Range of Traditional Program Amounts (claimed cost) $958 To $700,532

In lieu Payments (11)

Average amount $16,126

Search Expense (26)

traditional average amount (26) $969
  range $525 to $1,000
pilot average amount (19) $4,425
range $1,100 To $19,072

Reestablishment Cost

traditional average amount (35) $6, 238
  range $150 to $10, 000
pilot average amount (47) $52, 226
  range $9, 120 to $86, 313

Moving Expense (56)

Average claim $35,536
Range $958 To $700,532

Rhode Island Pilot Program - Internal Evaluation
In August 2001, a meeting was held with all parties involved with the Rhode Island test, including Rhode Island DOT, FHWA and consultant personnel.

The general consensus was the program (not fully complete as of this date) was a success. According to Rhode Island, all displaced businesses had relocated within Rhode Island and were successfully engaged in their business activity. However, like any new program, this one had its strong points and weak points.

Post-move interviews with many of the businesses indicated the program provided a needed supplement to facilitate business reestablishment. Since there was no control group of businesses, it is not possible to say with certainty that any business would have failed absent the expanded program. However, the state and its consultant believe the program made a stronger contribution towards successful relocation of all businesses.

Next, the team looked at each aspect of the program and analyzed its impact to the beneficiaries, and also analyzed the administrative burden the modified guidelines imposed. This was accomplished at the two-day meeting.

Searching
The search expense in the Pilot Program was an uncapped expense. Existing regulations had traditionally limited this payment to $1,000 and oversight was minimal. However, with the new uncapped eligibility, the necessity to review records, reject claims and negotiate items such as hourly rates became more important. The feeling of the state and its consultants was that the increased time required to administer the program was not commensurate with the benefit. Thus, if the test case were repeated they would suggest a capped payment at $5,000 to reduce the record-keeping burden on the business and lessen the administrative implementation of this benefit.

A review of project data as of January 2002 indicates that there were only 26 claims, with a maximum allowed payment of $19,072. The average Pilot Program payment was $4,425, which would support the State suggestion for a cap of the payment, at $5,000. This would appear to be a reasonable modification of the program and provide for some administrative efficiency.

There was also a discussion of expanding the concept of searching to include preliminary investigation as to the appropriateness of a site. This would entail applications for zoning changes or use permits, including the costs of unsuccessful efforts or locations later abandoned by the business as inadequate, for example, due to restrictions imposed as a part of the zoning process. This would be a flexible interpretation of what comprises a replacement location search.

Pilot Program Moving
Another payment that was discussed was the payment intended to subsidize the initial period of higher operating costs. In the Pilot Program these costs were determined based on actual cost and a comparison with a "comparable" property. However, all parties admitted that truly comparable properties were often not available and, therefore, this control aspect of the payment was lost. For example, if a business needed 2,000 square feet of retail space, and the only available replacement had 3,000 square feet, then the amount paid was based on the cost per square foot of the larger property applied to the 2,000 square foot of the subject. In essence, the calculation was in the abstract since the resulting payment could not truly cover the increased cost actually required. The discussion group concluded that a better comparison might be to examine the demand for competing properties on a per unit basis as well as a comparison of the whole. This would permit flexibility for size, parking, storage space, etc.

Under the traditional concept of "modifications to accommodate the business", flexibility was given to the businesses. The maximum cost was $10,000 and there was a general acceptance of any modification costs incurred by the business. In the Pilot Program, more oversight and control were exercised which limited the flexibility of the business. The post-move interviews questioned decisions made by the state and its consultants. During follow-up discussions, the state and consultants agreed that it is very difficult to rule on these issues and they typically leaned in favor of the business. However they could recall situations they termed "item-for-item" modification. If a business had eight convenience outlets in the subject property, a maximum of eight would be permitted at the replacement. This appears unreasonably burdensome and to some extent counter-productive to facilitate business relocation.

At the meeting on August 2001, the scope was expanded to include items that would be of benefit to business displacement but might not be a part of this Pilot Program. Topics were:

  1. Advance Payments
    It was felt a major weakness of the existing program, as well as the Pilot Program, was the requirement that a business pay for eligible cost and then seek reimbursement. This can amount to a business having thousands of dollars outstanding for weeks or months before receiving payment. Some states will arrange for advance payment (and such is authorized by FHWA). However, others will not do so. The consensus of the group was that either states should be required to make payment in advance for major cost or states should be required to pay reasonable financing costs for these expenses.

  2. Move Planning
    This payment provides services or pays for professional move planning for all businesses reasonably in need of these services. This is an existing eligible item but is seldom used or understood by displaced businesses. For the Pilot Program, the state was willing to provide for professional services when those services were jointly (business and state) felt to be a necessity. The state did not feel basic planning services, such as arranging for bids or schedules were professional services, so it denied these payments.

    For this payment to be more widely used, FHWA may need to better explain its intent and limits. It may also be necessary to provide expanded training to states on this benefit and add emphasis in project materials disseminated to individuals. The states also appear reluctant to fully utilize this benefit, as it requires oversight and monitoring thus increasing their workload. However, the pilot project had several instances where such services were beneficial and the consensus is that the services assisted the business and the state. Several of the businesses that were denied this service felt they should have been able to obtain this benefit.

  3. Downtime
    Downtime and loss of profits have been costs recognized as truly incurred by businesses, but given their subjective nature, have traditionally been omitted from relocation programs. However, these costs were mentioned by several of the businesses as significant burdens they incurred due to the move. In discussing the possibility of providing some payment for these costs, it became clear that any such payment would be difficult to determine. Questions such as, when does downtime begin; how to quantify the cost basis of downtime (pay scales, etc.) and the variety of costs (production delay, lost profits, etc.) make it unlikely that a fair basis could be set for such payment. It was the meeting consensus that this cost should remain a non-reimbursable expense of the business. Further, payment for downtime could reduce the incentive to promptly and efficiently complete the business relocation.

What Did We Learn from Pilot Program?

Rhode Island Relocation Pilot Project (I-195) Table 1 - Relocation Cost Summary (as of January 2002)

A.
No.
B.
Industry Group
C.
Displacee
Estimate, If
Exceeds D
D.
Total Claim
Includes
E+F+G+H
or I; or J
E.
Traditional
Move Cost
F.
Pilot Prog.
Move Cost
Including H or I
G.
Tarditional
Reestab.
Cost
H.
Rental
Assistance
I.
Down
Payment
J.
In Lieu
Payment
K.
Search
Expense
L.
Move
Completed?
M.
Owner
Contacted?
1 Arts   $96, 107 $9,917 $75,000 $10,000 $12,480     $1,190 Y N
2 Professional $92,000 $86,670 $1,670 $75,000 $10,000   $45,539     Y Y
3 Manufacturing $131,000 $97,775 $25,537 $71,238     $14,160   $1,000 Y Y
4 Retail   $9,897 $958 $8,940     $8,940     Y N
5 Entertainment $896,000 $436,479 $367,428 $61,481 $7,570         Y Y
6 Arts   $57,854 $11,540 $46,314   $17,699       Y Y
7 Manufacturing   $20,000           $20,000   Y Y
8 Manufacturing   $13,950 $13,275   $675         N N
9 Manufacturing   $0 $0             Y N
10 Arts   $27,323 $4,649 $19,200 $1,504 $19,200     $1,970 Y N
11 Entertainment   $8,011 $8,011             N N
12 Organization   $7,199 $1,466 $5,208   $5,208     $525 Y Y
13 Arts   $11,987 $11,987             Y N
14 Arts   $23,233 $4,828 $15,600   $15,600     $2,805 Y N
15 Manufacturing   $0 $0             Y Y
16 Organization   $22,845 $12,559 $4,158 $5,147 $4,158     $981 Y Y
17 Arts   $20,000           $20,000   Y N
18 Entertainment   $23,284 $12,174   $8,825       $2,285 N N
19 Arts   $21,582 $1,282 $20,300   $14,400       Y N
20 Arts   $0 $0             N N
21 Professional   $46,506 $1,806 $40,912 $3,788 $16,500       Y Y
22 Retail   $0 $0             Y Y
23 Retail   $7,290 $7,290             Y Y
24 Retail   $98,771 $16,474 $71,804 $4,400 $70,957     $6,094 Y Y
25 Professional   $134,938 $48,090 $75,000 $10,000 $75,000     $1,847 Y Y
26 Organizations   $9,970 $1,361 $5,617 $2,992 $5,617       Y Y
27 Entertainment   $22,420     $3,349       $19,072 N N
28 Professional   $32,770 $3,161 $26,397 $332 $7,200     $2,880 Y Y
29 Professional $98,000 $92,540 $8,903 $73,637 $10,000   $72,237     Y Y
30 Manufacturing   $0 $0             Y N
31 Arts $73,000 $66,329 $50,183 $10,573 $1,904       $3,669 Y Y
32 Entertainment   $98,299 $11,986 $76,313 $10,000 $9,400       Y N
33 Professional $200,000 $100,440 $20,475 $75,000   $75,000     $4,965 Y Y
34 Retail   $152,490 $71,482 $75,000 $6,008   $35,300     N N
35 Manufacturing   $81,163 $2,900 $75,000   $15,600     $3,263 Y N
36 Arts   $4,349 $4,349             Y Y
37 Manufacturing   $48,994 $4,339 $32,167 $2,615       $9,873 N N
38 Other   $87,620 $30,056 $57,563     $57,564     Y Y
39 Manufacturing   $0 $0             N N
40 Arts $21,365 $21,165 $5,687 $6,728 $7,840       $910 Y Y
41 Professional   $9,827           $9,827   Y Y
42 Professional   $20,000           $20,000   Y Y
43 Professional   $18,418 $18,418             Y Y
44 Arts   $7,675           $7,675   Y Y
45 Arts   $20,000           $20,000   Y Y
46 Arts   $15,261 $604 $13,550 $150       $957 Y N
47 Arts   $0 $0             Y N
48 Professional $20,000 $99,535 $15,072 $75,000 $9,463   $40,630     Y Y
49 Arts   $31,876 $4,754 $20,218 $6,905 $7,200       Y N
50 Professional $123,000 $117,010 $29,210 $75,000 $10,000   $45,719   $2,800 Y Y
51 Retail   $20,000           $20,000   Y Y
52 Professional   $61,413 $4,106 $55,002     $35,202   $2,305 Y N
53 Professional   $23,165 $1,731 $18,450 $1,884 $4,200     $1,100 Y Y
54 Arts   $94,070 $11,595 $75,000 $6,650   $20,587   $825 Y Y
55 Other $147,000 $129,756 $54,756 $75,000   $75,000       Y Y
56 Arts $108,455 $106,454 $21,484 $75,000 $6,866 $70,500     $3,104 Y Y
57 Manufacturing $446,000 $335,625 $243,975 $75,000 $10,000       $6,650 Y Y
58 Professional $51,000 $40,305 $4,024 $34,986 $1,295 $34,986       Y Y
59 Organization $43,387 $27,787 $1,287 $26,500   $26,500       Y Y
60 Professional   $3,789 $3,789             Y Y
61 Arts   $20,000           $20,000   Y Y
62 Arts   $11,691 $1,571 $9,120   $9,120     $1,000 Y N
63 Professional   $106,512 $21,643 $75,000 $9,869 $75,000       Y N
64 Arts $89,000 $69,377 $13,875 $47,873 $7,630         Y Y
65 Manufacturing   $775,532 $700,532 $75,000           N N
66 Manufacturing $115,000 $108,812 $19,706 $72,156 $10,000   $25,260   $6,951 Y Y
67 Arts   $25,710 $6,366 $19,344   $19,344       Y N
68 Arts   $97,547 $16,836 $75,000 $5,712         Y N
69 Organization   $96,525 $11,525 $75,000 $10,000         Y Y
70 Arts   $1,500 $1,500             N I
71 Arts   $20,000           $20,000   Y Y
72 Arts   $1,000         $1,000   Y Y  
73 Arts   $0 $0             Y N
74 Retail   $18,875           $18,875   Y Y
75 Professional $81,379 $76,379 $4,634 $63,583 $8,162 $19,796       Y Y
76 Arts $26,434 $23,434 $1,182 $14,202 $6,787       $1,263 Y Y
TOTALS     $4,725,110 $1,989,998 $2,177,898 $218,322 $705,665 $401,138 $177,377 $90,284    
Updated: 09/05/2014
HEP Home Planning Environment Real Estate
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