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Side-by-side Comparisons of Changes to the Uniform Act FAQ

Subpart D

UNIFORM ACT FREQUENTLY ASKED QUESTIONS (FAQs)
2005 August 2005 January 25, 2007  
Original Text Interim Text Final Text Comments
Side by Side Comparison of FAQ's  
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Moved: Italics
Deleted: Strikethrough
New: Red Bold
 
SUBPART D - PAYMENT FOR MOVING AND RELATED EXPENSES  
RESIDENTIAL MOVES     Title Deleted
   

57. §24.301. When a business is relocating, for which expenses related to the purchase or lease of a replacement site, can the owner be reimbursed?

A business owner is entitled to compensation for actual reasonable expenses incurred in searching for a replacement site, up to $2,500, including, but not limited to, the expenses described in §24.301(g)(17). These expenses could include costs for the time spent negotiating the purchase or the lease of a replacement site.

In addition, an owner can also be compensated for professional services performed prior to the purchase or lease, to determine the suitability of the replacement site for the business, if the agency determines that they are actual, reasonable and necessary. These services include such things as soil tests or marketing studies, but do not include fees or commissions directly related to the purchase or lease, as covered in §24.303(b).

In other words, reimbursement can be provided for time spent negotiating the purchase or lease as part of the $2,500 searching expenses, and for professional fees to determine the suitability of the site, but cannot be provided for fees or commissions directly related to the purchase or lease.

 
   

58. §24.301(d). If a project is not impacting the entire business but only a portion of the business's personal property, is the business eligible for a move payment based on direct loss of tangible personal property or substitute personal property? These options are not listed under §24.301(e), personal property moves.

Yes. While the regulation does not list the tangible personal property or substitute personal property options, they are always available at the agency's option when it makes sense to use them.

 
   

59. §24.301(e). What is covered by the "personal property only" moving provision in this section?

This section covers personal property that must be moved for a Federal or federally assisted project, and is owned by a person who is not displaced from a dwelling, business, farm or nonprofit organization. This includes personal property in a mini-storage facility that is being acquired, or personal property located on vacant land that is being acquired.

 

49 CFR 24.303(a)(3) and 24.304(a)(1). Are costs incurred in complying with OSHA and other code requirements at the replacement location considered eligible costs in situations where the business was not subject to the requirement at the displacement property because of a "grandfather" provision?

Modifications to personal property mandated by Federal, State or local law, code, or ordinance which are necessary to reassemble or reinstall the personal property or adapt it to the replacement structure, the replacement site, or the utilities at the replacement site are eligible for reimbursement under subsection 24.303(a)(3). The modifications authorized by this subsection must be clearly and directly associated with the reinstallation of the personal property and cannot be for general repairs or upgrading of equipment because of the personal choice of the business owner. Finally, the expenditures for authorized modifications must be reasonable and necessary.

Costs for repairs, modifications, or improvements to the replacement real property due to the requirements of laws, codes, or ordinances can only be paid under 49 CFR 24.304(a)(1) and are limited to the $10,000 maximum payment under this subsection. Any costs in excess of $10,000 are ineligible.

 

60. §24.301(g)(3)and §24.304(a)(1). Are costs incurred in complying with OSHA and other code requirements at the replacement location considered eligible costs in situations where the business was not subject to the requirement at the displacement property because of a grandfathered provision?

Modifications to personal property mandated by Federal, State or local law, code, or ordinance that are necessary to reassemble or reinstall the personal property or adapt it to the replacement structure, the replacement site, or the utilities at the replacement site are eligible for reimbursement under §24.301(g)(3). The modifications authorized by this subsection must be clearly and directly associated with the reinstallation of the personal property and cannot be for general repairs or upgrading of equipment or facility. Finally, expenditures for authorized modifications must be reasonable and necessary.

Costs for repairs, modifications, or improvements to the replacement real property due to the requirements of laws, codes, or ordinances can only be paid under §24.304(a)(1) and are limited to the $10,000 maximum payment under this subsection. Any costs in excess of $10,000 are ineligible.

 
NONRESIDENTIAL MOVES     Title Deleted

49 CFR 24.303(a)(3). Can the costs of pits, pads, and foundations necessary for the installation of machinery or equipment in the replacement business site be reimbursed as a moving cost?

The costs of pits, pads, and foundations can be reimbursed as an eligible moving cost if they are necessary for the reinstallation of equipment or machinery or the installation of substitute items that are necessary for the business operation, unless the value of the pits, pads, and foundations was clearly included in the just compensation paid for the real property.Normally, pits, pads, and foundations only add value to a property for a particular business operation and would not generally enhance real property. They should not be included in the valuation of the real property unless the highest and best use of the property being acquired is for the business operation for which it is being used and the fair market value is determined on this basis.

 

61. §24.301(g)(3).Can the costs of pits, pads, and foundations necessary for the installation of machinery or equipment in the replacement business site be reimbursed as a moving cost?

The costs of pits, pads, and foundations can be reimbursed as an eligible moving cost if they are necessary for the reinstallation of equipment or machinery or the installation of substitute items that are necessary for the business operation. Normally, pits, pads, and foundations only add value to a property for a particular business operation and would not generally enhance real property. In the case where the pits, pads and foundations are ascribed a contributory value, then that value may be deducted from the cost of the newly constructed pit, pads and foundations.

 

49 CFR 24.303(a)(3). Are the costs incurred for site preparation for installing underground tanks eligible moving expenses?

Underground tanks are generally considered realty and purchased as part of the real estate. However, if under State law, the tanks are considered to be personal property, site prep-aration costs necessary for the installation of the tanks could be considered an eligible moving expense. The site preparation would have to be necessary for reinstallation of the tanks (or substitute tanks), and the installed tanks would have to be required for the operation of the particular business being relocated.

 

62. §24.301(g)(3). Are the costs incurred for site preparation for installing underground tanks eligible moving expenses?

Underground tanks are generally considered realty and purchased as part of the real estate. If under state law, the underground tanks are personal property and will be moved and used at the replacement site, then they can be considered an eligible moving expense.

 

49 CFR 24.303(a)(6). Are there any limitations on the costs which can be reimbursed for licenses, permits, or certifications required of the displaced person at the replacement location.

The costs must be actual, reasonable, and necessary. The licenses, permits, or certification requirements eligible for reimbursement as moving expenses are those that are required to operate the particular business being relocated. They do not include general occupancy licenses, occupancy permits, building permits, or one-time assessments that any business would have to pay for occupancy of a property.

Reimbursement of actual, reasonable, and necessary costs is limited to those amounts that are: (1) for the remaining useful life of the licenses, etc., at the site acquired or (2) the costs of new licenses, etc., required to operate the business at the replacement site. The costs participated in should be those charged by the licensing agency. It is the displacing agency's responsibility to determine that the stated costs are necessary and reasonable.
Reimbursement under Reestablishment, 49 CFR 24.304, is available for the cost of occupancy permits, building permits, and other fees related to the replacement business site not eligible as moving expenses up to the $10,000 maximum payment. These are costs that would be incurred by any business entity occupying the real estate and are not directly related to the business operation being displaced.

 

63. §24.301(g)(11). Are there any limitations on the costs that can be reimbursed for licenses, permits, or certifications required of the displaced person at the replacement location?

The costs must be actual, reasonable, and necessary. The licenses, permits, or certification requirements necessary to operate the particular business being relocated are eligible for payment as moving expenses. Occupancy permits, licenses and such fees paid for the replacement real property, which were formerly eligible as reestablishment expenses, can now be reimbursed as moving expenses. Reimbursement of actual, reasonable, and necessary costs may be limited to those amounts that are for the remaining useful life of the licenses, etc., at the site acquired.

 
 

25. What are the changes made to the Actual Direct Loss of Tangible Personal Property provisions in §§24.301(g)(14)(i) and (ii)?

A clarification of the wording in §§24.301(g)(14)(i) and (ii) was made. The intent of the revision in actual direct loss of tangible personal property is to insure the payment is based on the lesser of the fair market value "in place, as is" or the estimated cost to "move and reconnect, as is." The fair market value in place, as is, is based on the current fair market value of the item at the displacement site.

Here is an example showing how to calculate the payment. The payment shall consist of the lesser of A. or B., as shown below.

A. Calculate the amount for the continued use of an item, in place, as is, at the displacement site, and subtract the (net) proceeds from the sale:

Current fair market value of the equipment in place, as is, installed and fully operational                                                   $10,000
Subtract the proceeds from the sale - 7,000

 

$ 3,000
Add the cost of the sale + 500

 

$ 3,500

B. The wording in §24.301(g)(14)(ii) was revised to clarify that current estimated cost to move and reconnecting an item "as is" at the replacement site will not include upgrades for code requirements. If the equipment is in storage or not being used at the acquired site the estimated cost to move cannot include storage. Additional guidance can be found in the Preamble, page 604, and the Appendix, page 635, of the final rule. Calculate the estimated cost to move and reconnect the item, as is, with no upgrades:

Current estimated cost to move and reconnect, as is with no upgrades for code requirements: $ 2,500

PAYMENT is the lesser of A. or B. above: $2,500

64. §24.301(g)(14).What changes were made to the provision that covers actual direct loss of tangible personal property?

The wording was revised to clarify that current estimated cost to move and reconnecting an item "as is" at the replacement site will not include upgrades for code requirements. If the equipment is in storage or not being used at the acquired site the estimated cost to move it cannot include storage or cost to reconnect. The intent of the revision of the actual direct loss of tangible personal property provision is to insure the payment is based on the lesser of the fair market value "in place, as is" or the estimated cost to "move and reconnect, as is." The fair market value in place, as is, is based on the current fair market value of the item at the displacement site. The payment shall consist of the lesser of A. or B., as shown in this example:

A. Calculate the amount for the continued use of an item, in place, as is, at the displacement site, and subtract the (net) proceeds from the sale:

Current fair market value of the equipment in place, as is, installed and fully operational $10,000
Subtract the proceeds from the sale - 7,000

 

$ 3,000
Add the cost of the sale + 500

 

$ 3,500

B. The wording in §24.301(g)(14)(ii) was revised to clarify that current estimated cost to move and reconnecting an item "as is" at the replacement site will not include upgrades for code requirements. If the equipment is in storage or not being used at the acquired site the estimated cost to move cannot include storage. Calculate the estimated cost to move and reconnect the item, as is, with no upgrades:

Current estimated cost to move and reconnect, as is with no upgrades for code requirements $ 2,500

Payment is the lesser of A. or B., in this case $2,500.

 
 

26. What is the difference between Actual Direct Loss and Substitute Personal Property?

Actual direct loss is intended to be used by businesses, farms and non-profits that are either going out of business or elect not to move a particular piece of equipment. The payment for substitute personal property is intended to pay for an item that will not be moved, but will be promptly replaced at the replacement site. The payment is the lesser of lesser of A. or B., as shown below:

A. Cost of a substitute item $10,000
Add the cost of installation + 1,000

 

$11,000
Subtract the proceeds of sale or trade-in - 2,500

 

$ 8,500
Add in the cost of the sale + 500

 

$ 9,000

B. Cost to move and reinstall the replaced item with no allowance for storage $12,500

PAYMENT is the lesser of A. or B. above: $9,000

65. §24.301(g)(14). What is the difference between actual direct loss and substitute personal property?

Actual direct loss is intended to be used by businesses, farms and non-profits that are either going out of business or elect not to move a particular piece of equipment. The payment for substitute personal property is intended to pay for an item that will not be moved, but will be promptly replaced at the replacement site. The payment is the lesser of lesser of A. or B., as shown in this example:

A. Cost of a substitute item $10,000
Add the cost of installation + 1,000

 

$11,000
Subtract the proceeds of sale or trade-in - 2,500

 

$ 8,500
Add in the cost of the sale + 500

 

$ 9,000

B. Cost to move and reinstall the replaced item with no allowance for storage $12,500

Payment is the lesser of A. or B. above, in this case $9,000.

 

49 CFR 24.303(a)(13). How early can search costs be incurred by a displaced business and still be reimbursable? Could they be incurred prior to authorization or award of a grant for the project or program?

While searching costs may be incurred by the displaced business at any time, the agency cannot reimburse the displaced business for any searching costs incurred before the displaced business qualifies as a displaced business as defined in section 24.2(g).

 

66. §24.301(g)(17).How early can search costs be incurred by a displaced business and still be reimbursable? Could they be incurred prior to authorization or award of a grant for the project or program? Can search expenses ever exceed $2,500?

While searching costs may be incurred by the displaced business at any time after there is a reasonable expectation that the business will be displaced, the agency cannot reimburse the displaced business for any searching costs incurred until the displaced business qualifies as a displaced business as defined in §24.2(a)(9).

In unusual circumstances search expenses over $2,500 may be reimbursed when the agency verifies that the expenses are justified and obtains a waiver from the funding agency, per §24.7.

 
 

27. Is a business or farm displacee entitled to payment for time spent negotiating the lease of a replacement site under § 24.301(g)(17)(vi) [part of payment for actual, reasonable moving and related costs] or does that provision apply only to displacees who purchase a replacement property?

The benefit applies to leases as well as purchases. The list in §24.301(g)(17) provides examples of qualifying costs; it is not an all-inclusive list.

67. §24.301(g)(17)(vi). Is a business or farm displacee entitled to payment for time spent negotiating the lease of a replacement site under actual, reasonable moving and related costs? Or does that provision apply only to displacees who purchase a replacement property?

The benefit applies to leases as well as purchases. The list in §24.301(g)(17) provides examples of qualifying costs; it is not an all-inclusive list.

 
 

28. What is "low value/high bulk" in 49 CFR 24.301(g)(18)? When should I use it?

Low value/high bulk is an eligible moving expense for certain types of personal property encountered with nonresidential properties. Low value/high bulk materials are items of personal property owned by a displaced business, farm or non-profit organization that the agency determines would cost more to move than replace. Some examples of low value/high bulk materials include but are not limited to stockpiled sand, gravel, metals, etc. This paragraph provides a procedure for calculating the allowable move cost for these items. This procedure may also be applied to "personal property only" moves in 49 CFR 24.301(e). The application of the low value/high bulk provision is at the acquiring agency's discretion. The agency should only use this provision if it is willing to accept ownership and the ultimate cleanup costs of the material. If the agency opts to offer this provision to the displaced business, the displacing agency makes the decision on whether the material is to be moved to the new location. Generally, if the agency requires the material to be moved by the owner, then this provision should not be used.

68. §24.301(g)(18).What is low value/high bulk and when should I use it?

Low value/high bulk is an eligible moving expense for certain types of personal property encountered with nonresidential properties. Low value/high bulk materials are items of personal property owned by a displaced business, farm or non-profit organization that the agency determines would cost more to move than replace. Some examples of low value/high bulk materials include but are not limited to stockpiled sand, gravel, metals, etc.

Low value/high bulk may also be applied to personal property only moves in §24.301(e).

The application of the low value/high bulk provision is at the agency's discretion. The agency should only use this provision if it is willing to accept ownership and the ultimate cleanup costs of the material. If the agency opts to offer this provision to the displaced business, the agency makes the decision on whether the material is to be moved to the new location. If the agency determines that the cost to move is disproportionate to the property's value, the moving cost payment shall not exceed the lesser of the value of the property or the cost to move it. It may be in the agency's best interest to have the owner remove it, since the material will have to be removed as a project expense otherwise. Generally, if the agency requires the material to be moved by the owner, then this provision should not be used.

 

49 CFR 24.303(b)(2). Can the displacing agency withhold payment for a move solely because the displaced person does not provide advance written notice to the agency of the date of the proposed move?

Yes. However, the records of the displacingagency should provide documentation of the advice provided to the displaced person concerning the responsibility to provide notice and the necessity for the notice (so that the agency can monitor the move and make reasonable and timely inspection of the personal property at both the displacement and replacement sites). If the displaced business provides verifiable records, bills, and receipts documenting actual expenses incurred and identifies the personal property moved; withholding payment would be inappro-priate. A displaced person has the right to appeal any such decision made by the displacing agency.

 

69. §24.301(i). Can the agency withhold payment for a move solely because the displaced person does not provide advance written notice to the agency of the date of the proposed move?

Yes. However, the records of the agency should provide documentation of the advice provided to the displaced person concerning the responsibility to provide notice and the necessity for the notice. Advance notice allows the agency to monitor the move and make reasonable and timely inspection of the personal property at both the displacement and replacement sites. If the displaced business provides verifiable records, bills, and receipts documenting actual expenses incurred and identifies the personal property moved, withholding payment is inappropriate. A displaced person has the right to appeal a decision to withhold payment under §24.10

 

49 CFR 24.303(c). Should a moving cost estimate prepared by an agency employee be based on the costs charged by a professional moving firm or on the actual costs a displaced person may incur? Is it permissible to negotiate with the owner of a business the amount to be paid to him/her for a self move?

The moving cost estimate for a non-residential self-move prepared by a qualified agency employee should be based on the cost that would be charged by a professional moving firm. If the estimate includes profit, overhead, or other additional costs that the business will not actually incur, it is permissible for the agency to negotiate a payment for an amount that would reflect the actual costs the business would incur in the move. This procedure does not preclude the owner from electing to make an actual cost, documented self-move.

 

70. §24.301(d)(2).Should a moving cost estimate prepared by an agency employee be based on the costs charged by a professional moving firm or on the actual costs a displaced person may incur? Is it permissible to negotiate with the owner of a business the amount to be paid to him/her for a self-move?

The moving cost estimate for a non-residential self-move prepared by a qualified agency employee should be based on the cost that would be charged by a professional moving firm. If the estimate includes profit, overhead, or other additional costs that the business will not actually incur, it is permissible for the agency to negotiate a payment for an amount that would reflect the actual costs the business would incur in the move. This procedure does not preclude the owner from electing to make an actual cost, documented self-move.

 

49 CFR 24.301(d) and 24.303(a)(4). Is storage of personal property an entitlement of every displaced person? Who determines if an agency should pay for the storage of personal property, the terms of such storage, and the length of time for storage payment?

The agency determines if the storage of personal property is a reasonable and necessary moving expense for a displaced person. The determination should be based on the needs of the agency and the displaced person, the nature of the business, the plans for permanent reloca-tion, the amount of time available for the relocation process, and whether storage will facilitate relocation. It is the agency's responsibility to set the terms for storage, including prohibiting thestorage site's use as a temporary business operating site and the length of time. On the other hand, if storage is essential to a successful relocation, it may be extended, for good cause, to more than one year.

 

71. §24.301(g)(4). Is storage of personal property an entitlement of every displaced person? Who determines if an agency should pay for the storage of personal property, the terms of such storage, and the length of time for storage payment?

The agency determines if the storage of personal property is a reasonable and necessary moving expense for a displaced person. The determination should be based on the needs of the displaced person, the nature of the business, the plans for permanent relocation, the amount of time available for the relocation process, and whether storage will facilitate relocation. It is the agency's responsibility to set the terms for storage.

 
REESTABLISHMENT EXPENSES - NONRESIDENTIAL     Title Deleted
 

29. What is the new fixed residential moving cost schedule effective date? Does the new fixed residential moving cost schedule apply if the initiation of negotiation (ION) or the notice of eligibility was issued on or before June 15, 2005?

Unless the agency has selected an earlier date to begin operating under the new schedule, the date of the move is the operative date and the new schedule applies even if the ION occurred prior to June 15. There may be an instance that a check was cut based on the old schedule and the move did not occur until after the 15th. In this instance, the difference should be paid to the displacee. The rationale is that the schedule was updated to cover the increase in moving costs and the displacees need to be treated on a fair and equitable basis. The only exception is in these cases where state law precludes this.

72. §24.302.When a new fixed residential moving cost scheduleis published how does theeffective date affect moves being processed?

Unless the agency selects an earlier date to begin operating under the new schedule than the effective date published in the Federal Register, the date of the move is the operative date. The newly published moving cost schedule applies even if the initiation of negotiation occurred prior to the effective date of the new schedule. The key is the date of the actual move.

 

49 CFR 24.302. Is the fixed moving payment provided for in section 24.302 the only coverage for a seasonal residence?

No. The occupant of a seasonal residence could receive actual moving expenses in accordance with section 24.301. Persons owning or renting seasonal residences are generally not eligible for any relocation payments other than for moving expenses.

 

73. §24.302. Is the fixed moving payment the only coverage for a seasonal residence?

No. The occupant of a seasonal residence could receive actual moving expenses in accordance with §24.301. Persons owning or renting seasonal residences are generally not eligible for any relocation payments other than for moving expenses.

 
   

74. §24.303. Can a displaced business obtain reimbursement for professional services to determine the suitability of more than one site?

Yes. If, as a result of the professional services performed, one or more sites are found to be unsuitable for the business. An agency may also agree to provide reimbursement for multiple site assessments. In all cases the agency must determine that the cost of such additional professional services are actual reasonable and necessary. If professional services indicate that a particular replacement site would be suitable, but an owner simply changes his/her mind and decides not to move to that site, additional professional services to assess other sites should normally not be considered reasonable and necessary.

 
   

75. §24.303(c). What are some examples of impact fees or one-time assessments?

Actual and reasonable impact fees for anticipated heavy utility usage are eligible for payment as a related moving expense. In the past these fees were eligible as a reestablishment expense and limited to $10,000. Examples include (a) water and sewer tap fees for a laundromat business which requires a larger service tap than a typical business, (b) a fee to provide 3-phase electrical service required by the displaced business when replacement sites available were served by single phase transformers, or (c) other one-time charges or fees a utility requires to finance infrastructure necessary to provide increased usage.

The intent is to reimburse a business for impact fees for anticipated heavy utility usage when the move requires the business to move to a new location where impact fees for anticipated heavy utility usage are being charged. If suitable replacement sites or properties are available where impact fees for anticipated heavy utility usage are not being charged, reimbursement is at the agency's discretion, based on what is reasonable and necessary. Potential eligibility of impact fees for anticipated heavy utility usage is an important advisory service. The regulation limits impact fees or one-time assessments for anticipated heavy utility usage to utilities, i.e., water, sewer, gas, and electric. Impact fees for other major infrastructure such as roads, fire stations, regional drainage improvements and parks, for example, are not eligible.

 

49 CFR 24.304. Is new construction at the replacement site eligible for reimbursement as a reestablishment expense?

The cost of constructing a new business building on the vacant replacement property is a capital expenditure and is generally ineligible for reimbursement as a reestablishment expense. In those rare instances when a business cannot relocate without construction of a replacement structure, a displacing agency may request a waiver of Part 24.304(b)(1) under the provisions of 49 CFR 24.7. An example of such an instance would be in a rural area where there are no suitable buildings available and the construction of a replacement structure will enable the business to remain a viable commercial operation. If a waiver is granted, the cost of constructing the new building will be considered an eligible reestablishment expense subject to the $10,000 statutory limit on such payment.

 

76. §24.304. Is new construction at the replacement site eligible for reimbursement as a reestablishment expense?

The cost of constructing a new business building on the vacant replacement property is a capital expenditure and is generally ineligible for reimbursement as a reestablishment expense. In those rare instances when a business cannot relocate without construction of a replacement structure, an agency may request a waiver of §304(b)(1) under the provisions of §24.7. An example of such an instance would be in a rural area where there are no suitable buildings available and the construction of a replacement structure will enable the business to remain a viable commercial operation. If a waiver is granted, the cost of constructing the new building will be considered an eligible reestablishment expense subject to the $10,000 statutory limit on such payment.

 

49 CFR 24.304. What reestablishment expense costs are eligible for reimbursement if a displaced business occupies a shell structure.

Basically all of the costs listed under 49 CFR 24.304(a) are eligible if considered actual, reasonable and necessary for the operation of the business. In markets where existing and new buildings are available for rental (and sometimes for purchase), the buildings or the various units available within the buildings often have only the basic amenities such as heat, light, and water, and sewer available. These buildings or units are shells. The cost of a building (shell) is not an eligible expense because the shell is considered a capital real estate improvement (a capital asset). However, this determination does not preclude the consideration by an acquiring agency of certain modifications to an existing replacement business building. Eligible improvements or modifications up to the amount of $10,000 may include the addition of necessary facilities such as bathrooms, room partitions, built-in display cases and similar items, if required by Federal, State or local codes, ordinances, or simply considered reasonable and necessary for the operation of the business.

 

77. §24.304. What reestablishment expense costs are eligible for reimbursement if a displaced business occupies a shell structure?

Basically all of the costs listed under §24.304(a) are eligible if considered actual, reasonable and necessary for the operation of the business. In markets where existing and new buildings are available for rental (and sometimes for purchase), the buildings or the various units available within the buildings often have only the basic amenities such as heat, light, and water, and sewer available. These buildings or units are shells. The cost of the building (shell) is not an eligible expense because the shell is considered a capital real estate improvement (a capital asset). However, this determination does not preclude the consideration by an agency of certain modifications to an existing replacement business building. Eligible improvements or modifications up to the amount of $10,000 may include the addition of necessary facilities such as bathrooms, room partitions, built-in display cases and similar items, if required by Federal, State or local codes, ordinances, or simply considered reasonable and necessary for the operation of the business.

 

49 CFR 24.304. If the nature, character, or type of business established after displacement is different from the business displaced by acquisition, would it be eligible for a reestablishment payment?

Yes. A change in a displaced business does not affect eligibility for actual, reasonable, and necessary reestablishment expenses incurred in reestablishing a business. In some instances, it is not economically feasible to relocate a particular business operation and a change in the nature, character, or type of business may be the most practical solution for the business operator. Expenditures of funds for reestablishing the business must be reviewed for acceptability. Costs of new or used equipment purchased to serve the changed business operation are not eligible for reimbursement as reestablishment expenses. Similarly, general repairs or improvements to the replacement property made to the structure because of the personal choice of the business operator are ineligible. The costs of utility upgrades and necessary and reasonable modifications to the real property to accommodate the changed business may be eligible when properly supported. All reestablishment payments are limited by the $10,000 statutory maximum.

 

78. §24.304. If the nature, character, or type of business established after displacement is different from the business displaced by acquisition, would it be eligible for a reestablishment payment?

Yes. A change in a displaced business does not affect eligibility for actual, reasonable, and necessary reestablishment expenses incurred in reestablishing a business. In some instances, it is not economically feasible to relocate a particular business operation and a change in the nature, character, or type of business may be the most practical solution for the business operator. Expenditures of funds for reestablishing the business must be reviewed for acceptability. Costs of new or used equipment purchased to serve the changed business operation are not eligible for reimbursement as reestablishment expenses. Similarly, general repairs or improvements to the replacement property made to the structure because of the personal choice of the business operator are ineligible. The costs of utility upgrades and necessary and reasonable modifications to the real property to accommodate the changed business may be eligible when properly supported. All reestablishment payments are limited by the $10,000 statutory maximum.

 

49 CFR 24.304. Is a business operation that consists solely of leasing real estate to others at the displacement site eligible for the reestablishment payment?

Yes. The business of leasing real estate to others is considered to be a "small business" for the purposes of the regulations for the Uniform Act. The owner of the business is eligible for reimbursement of the actual, reasonable, and necessary expenses for the reestablishment of a rental property. The agency should provide the same advisory services to real estate leasing operations as performed for other businesses including providing information on suitable replacement properties. It is the agency's responsibility to determine if the expenses to be reimbursed under reestablishment are reasonable and necessary.

 

79. §24.304. Is a business operation that consists solely of leasing real estate to others at the displacement site eligible for the reestablishment payment?

Yes. The business of leasing real estate to others is considered to be a small business for the purposes of the regulations for the Uniform Act. The owner of the business is eligible for reimbursement of the actual, reasonable, and necessary expenses for the reestablishment of a rental property. The agency should provide the same advisory services to real estate leasing operations as performed for other businesses including providing information on suitable replacement properties. It is the agency's responsibility to determine if the expenses to be reimbursed under reestablishment are reasonable and necessary.

 
FIXED PAYMENT - NONRESIDENTIAL MOVES     Title Deleted

49 CFR 24.306(e). If the net income of a displaced business is very low in one or both years prior to displacement, can the payment be based upon a different period?

Yes. Average annual net earnings may be based upon a different time period of two consecutive years when the displacing agency determines it to be more equitable.

 

80. §24.305(e). If the net income of a displaced business is very low in one or both years prior to displacement, can the payment be based upon a different period?

Yes. Average annual net earnings may be based upon a different time period when the agency determines it to be more equitable.

 

49 CFR 24.306(e). If a business experienced a loss in one of the two years, should the amount of the loss be offset against the net income from the other year, or should the income be considered as zero for the year in which the loss was incurred?

If a loss of net income occurs in one year and a gain in the other year, the income of the year in which the loss was incurred shall be computed as zero when determining the average net income for the 2-year period.

 

81. §24.305(e). If a business experienced a loss in one of the two years, should the amount of the loss be offset against the net income from the other year, or should the income be considered as zero for the year in which the loss was incurred?

If a loss of net income occurs in one year and a gain in the other year, the income of the year in which the loss was incurred should be computed as zero when determining the average net income for the 2-year period.

 

49 CFR 24.306(e). If a business has been in operation for only a short period of time (e.g., six months) prior to displacement, what method is used for determining the amount of the fixed payment?

The fixed payment would be based on the net earnings of the business at the dis-placement site for the actual period of operation projected to an annual rate. The existing net earnings income data would be extrapolated and used to project what the net earnings could have been if the business had been in business for a full two years. If the business is seasonal, this fact should be taken into account in the computations.

 

82. §24.305(e). If a business has been in operation for only a short period of time (e.g., six months) prior to displacement, what method is used for determining the amount of the fixed payment?

The fixed payment would be based on the net earnings of the business at the displacement site for the actual period of operation projected to an annual rate. The existing net earnings income data should be extrapolated and used to project what the net earnings could be if the business was in business for a full two years. If the business is seasonal, this fact should be taken into account in the computations. Paragraph (a)(6) of this section requires that the business contribute materially to the income of the displaced person during the 2 taxable years prior to displacement. This does not mean that the business needed to be in existence for a minimum of 2 years prior to displacement, only that the business contributes materially to the income of the displaced person during that 2-year period.

 
 

30. Is it permissible to combine different types of moves on the same parcel?

Yes, with the exception of §24.305, "Fixed Payment of Moving Expense -Nonresidential." If a fixed payment for moving expense - nonresidential payment set out in § 24.305 is selected, then all other types of moves are ineligible. Otherwise, there is no restriction on combining the various types of moves.

For example: when moving from a dwelling, the displacee may elect to use a commercial mover to move the heavy items (pianos, appliances, dressers, etc.) and request a self-move based on receipted bills or use the fixed residential moving costs schedule (§24.302) to move the remaining items. If the displacee elects to use a combination of the fixed residential moving costs schedule and a commercial mover for personal property within the dwelling, an agency adjustment to the actual room count used for the fixed schedule may be required to offset the items moved by the commercial mover. When these two moving cost methods are combined, the fixed residential moving cost schedule typically includes the cost for utility service transfer fees.

The same is true for a nonresidential move (business, farm or nonprofit organization). For example, a business owner may want to use company employees to move items of personal property in the office area and a commercial mover to move the heavy equipment requiring special disconnection and reconnection expertise. For the office area, the company could submit for payment the lower of two bids or estimates from a commercial mover or actual cost based on receipted bills.

83. §24.305. Is it permissible to combine different types of moves on the same parcel?

It is permissible except for §24.305, fixed payment of moving expense – nonresidential. If a fixed payment for moving expense – nonresidential payment is selected, then all other types of moves are ineligible. Otherwise, there is no restriction on combining the various types of moves. For example, when moving from a dwelling, the displacee may elect to use a commercial mover to move the heavy items (such as pianos, appliances and dressers) and request a self-move based on receipted bills or use the fixed residential moving costs schedule found at §24.302, to move the remaining items. If the displacee elects to use a combination of the fixed residential moving costs schedule and a commercial mover for personal property within the dwelling, an agency adjustment to the actual room count used for the fixed schedule may be required to offset the items moved by the commercial mover. When these two moving cost methods are combined, the fixed residential moving cost schedule typically includes the cost for utility service transfer fees.

The same is true for a nonresidential move (business, farm or nonprofit organization). For example, a business owner may want to use company employees to move items of personal property in the office area and a commercial mover to move the heavy equipment requiring special disconnection and reconnection expertise. For the office area, the company could submit for payment the lower of two bids or estimates from a commercial mover or actual cost based on receipted bills.

 
Updated: 09/05/2014
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