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Contributing Editors
Director: Virgil Pridemore
Managing Editors: Mike Jones and Dave Leighow
Virgil Pridemore, Office Director for the Office of Real Estate Services
I am honored to serve the Federal Highway Administration (FHWA) Office of Real Estate Services (HEPR) as the new Office Director. I am very impressed by the hard work and commitment of the staff here, and I have greatly appreciated their support as I transitioned into this role over the past few months. It is an exciting time to be at HEPR as many changes and transitions are underway. In the first half of 2014, our major focus was on implementing regulatory changes in compliance with the Moving Ahead for Progress in the 21st Century Act (MAP-21) legislation, but we also continued work on a number of other activities, as detailed in the following list:
In the near future, HEPR will begin work on some new initiatives, including the following:
I look forward to meeting more realty staff at FHWA, and I look forward to learning more about activities in the field through the newsletter. The staff here is truly the organization's greatest asset.
The FHWA's Performance Year (PY) 2014 Strategic Implementation Plan (SIP) included, among the Strategic Objectives for Program Delivery, an initiative to share noteworthy practices associated with accelerating ROW acquisition and clearance. In response to that objective, HEPR conducted a review to identify successful practices that Division Offices employ in their stewardship and oversight of State Department of Transportation (DOT) realty programs.
In order to collect and subsequently share successful practices in stewardship and oversight, HEPR created a review team. The team, consisting of 4 HEPR staff and 2 Resource Center staff, conducted interviews with the realty staff from 10 Division Offices, selecting 2 to 3 from each of HEPR's 4 Field Services Areas. The participating Division Offices included Florida, Idaho, Maine, Mississippi, New York, Oklahoma, Texas, Utah, Washington, and West Virginia. The team conducted two of the interviews onsite in Florida and Washington and the remainder by phone.
The team observed a number of successful practices being carried out by the Division Offices to ensure the stewardship and oversight of their respective State's programs. One of the consistent, successful practices observed is that of Division Offices working closely with their State DOT counterparts to develop and maintain strong working relationships and open communications. The Division Office realty staff members often attend meetings with their State DOT counterparts and frequently participate jointly in program and project reviews in a team environment.
Another successful practice observed was the participation of the Division Office realty staff in their State DOT's Quality Assurance Review and ROW Compliance Assessment programs. These programs enable both the Division Office and the State DOT to maintain consistency in promoting stewardship and conducting oversight of the State's realty program.
As the review progressed, HEPR recognized the value of the information the reviews produced and incorporated the initiative into the 2015 SIP. The PY2015 version of the ROW SIP Review has 12 participating Division Offices: Arkansas, Arizona, California, Indiana, Kansas, Kentucky, Maryland, Missouri, Ohio, Oregon, Tennessee, and Vermont. The reviews will continue in each annual SIP, at least through the PY2018 Plan, by which time the team will have reviewed all 52 FHWA Division Offices.
For additional information, please contact Dave Leighow at david.leighow@dot.gov.
Within the past few months, HEPR launched two new webpages related to alternative uses of ROW. The first, available here, is dedicated to renewable energy projects underway nationwide in highway ROW. The webpage offers visitors an interactive map of current highway renewable energy projects along with frequently requested sample documents, such as lease agreements and power purchase agreements. The webpage is part of a pilot project to enable the implementation of alternative uses of ROW. The second webpage focuses on other innovative uses of ROW, including property management practices, advertising and sponsorships, and airspace leasing. The webpage will provide transportation agencies information to help them consider innovative ROW uses that may secure new revenue streams, cost savings, and social and environmental benefits.
HEPR recently developed two recruiting brochures to help raise awareness of FHWA's realty program area among candidate job seekers. One brochure targets current professionals, while the other is directed toward students and recent graduates. The brochures describe ROW topics generally, along with professional development opportunities, potential benefits, and guidelines for applying to job openings.
All HEPR staff and Division Office realty specialists are encouraged to share the brochures at career fairs, industry events, and other relevant outlets. Two versions of each brochure, one for viewing electronically and one for printing, are available here on HEPR's Discipline Support SharePoint site. Follow the "Brochure Printing Instructions" to print copies for your office.
For more information on this effort, please contact Cliff Pearson at clifford.pearson@dot.gov.
Congratulations to the winners of the FHWA 2014 Excellence in ROW Awards and to all who were nominated for these awards. HEPR developed this biennial awards program to honor those who excel in improving the real property acquisition process, while ensuring that property owner and tenant rights are protected. These awards recognize outstanding innovations that enhance the ROW professional's ability to meet the challenges associated with acquiring real property for a Federal-aid project.
This year, FHWA received many impressive entries describing exceptional ROW programs, projects, and leaders from around the country. The five award categories include: Innovation, Leadership, Stewardship, Streamlining and Integration, and Technical Specialties. The winners demonstrated successful methods to acquire property rights and manage ROW for Federal-aid projects.
PEER OF THE YEAR: Patrick Forinash
Washington State DOT (WSDOT)
Relocation Lead, Mega Projects
This Peer of the Year Award recognizes Patrick Forinash's leadership and dedication during the relocation of Seattle's Museum of History and Industry (MOHAI) to a replacement facility. Mr. Forinash sought innovative solutions to a challenging relocation, established strong relationships with the MOHAI staff, which were instrumental to minimizing the amount of down time, and facilitated coordination among all parties.
INNOVATION AWARD: Utah DOT (UDOT)
ROW Division
This Innovation Award recognizes the UDOT ROW Division's creation of a local government component within their ROW Electric Project Management Module that allows UDOT to effectively manage the ROW process at the local level. This component has standardized local agencies' acquisition process and improved UDOT's ROW program by reducing costs, ensuring quality, and enhancing consistency.
Contributors: James Olschewski, Lyle McMillan, Michael Timothy, and Monty King.
LEADERSHIP AWARD: Indiana DOT (INDOT)
Real Estate Division
This Leadership Award recognizes the INDOT Real Estate Management Team's creative approach to team building and ROW coordination on the Louisville-Southern Indiana Ohio River Bridges Project. The INDOT acquired a number of complex ROW parcels of great interest to the community. The team was able to secure parcels faster, increase work capacity, and clear the ROW ahead of schedule.
Contributors: Jim Crall, Mike Jett, Scott Adams, and Todd Clift.
STEWARDSHIP AWARD: Virginia DOT (VDOT)
Property Management/Disposal Team
This Stewardship Award recognizes the VDOT Property Management/Disposal Team's successful ownership and management of the Hunting Towers property, which was acquired as part of the Woodrow Wilson Memorial Bridge Replacement Project. For over 12 years, the team innovatively managed the apartment complex in a manner that met private ownership standards. The team's effective stewardship of taxpayer dollars resulted in a net revenue refund of over $35 million to the project.
Contributors: Bryan O'Sullivan, Dave Holsinger, Neil Hord, Paul Stahl, Richard Bennett, and Stuart Waymack.
STREAMLINING AND INTEGRATION AWARD: Arizona DOT (ADOT)
ROW Project Management Section
his Streamlining and Integration Award recognizes the ADOT ROW Project Management Section's implementation of a new practice for estimating complicated cost-to-cure compensation. This new method solicits input from the property owner and tenants in possession, encouraging owner buy-in. This resulted in a higher than expected rate of successful negotiations. Since implementing this new practice, ADOT has successfully negotiated and closed every early acquisition on the Interstate 10 project.
Contributors: Dave Edwards, John Eckhardt, Paula Gibson, Richard Erickson, and Thomas Flynn.
Honorable Mention Awards
INNOVATION AWARD: Idaho Transportation Department (ITD)
Greg Graybadger, ROW Section
This Honorable Mention Innovation Award recognizes Greg Graybadger's innovative application of the discounted cash flow analysis methodology, which is typically used for valuing land proposed for subdivision, to appraise land needed for wetland mitigation. The methodology produced valuation reports that resulted in the purchase and development of property eligible for wetland mitigation credits required of ITD under the Clean Water Act.
LEADERSHIP AWARD: North Carolina DOT (NCDOT)
Florence Green, ROW Unit
This Honorable Mention Leadership Award recognizes the commitment of Florence Green, formerly with NCDOT, for developing and implementing a ROW Training program for new employees and a series of professional development courses for existing staff and stakeholders. The ROW Unit has since offered 18 training courses for staff, local agency partners, and consultant stakeholders throughout the State.
LEADERSHIP AWARD: Wyoming DOT (WYDOT)
WYDOT Shoshone & Arapaho ROW Team
This Honorable Mention Leadership Award recognizes the WYDOT Shoshone & Arapaho ROW Team's success in delivering the first Federally funded project in Wyoming involving Tribal staff efforts to reconstruct a roadway located on reservation lands. The team members were self-starting, motivated, and collaborative, which allowed them to streamline the Bureau of Indian Affairs' ROW approval process.
Contributors: Letitia Black of the Bureau of Indian Affairs, Colette Friday, Nadine Vasquez, Wildene Trosper, (featured to the left), Emily Underwood, Howard Brown, and Nicole Brown of the Shoshone & Arapaho Department of Transportation, and Kevin Lebeda of WYDOT.
STEWARDSHIP AWARD: Wisconsin DOT (WisDOT)
Division of Transportation System Development
Bureau of Technical Services/Regional Real Estate Units - Local Public Agency
This Honorable Mention Stewardship Award recognizes the WisDOT Regional Real Estate Units - Local Public Agency Team's collaborative effort to improve the quality of project oversight, guidance, and training for LPA programs. The team implemented changes in policy and procedures to allow local municipalities to streamline the ROW process for Federally funded highway projects.
Contributors: Cynthia Michalski, Kerry Paruleski, and Teresa McClung.
Judges
Lisa Harrison
R/W-URAC, SR/WA, R/W-RAC, R/W-NAC, President of Pinnacle Consulting Management Group, Inc., which provides project ROW/land acquisition and land acquisition program management services.
Kathy Facer
Retired as a FHWA Office of Real Estate Services Realty Specialist after 40 years of service.
Joseph Pignato
Assistant Director for the Minnesota Department of Transportation (MnDOT) Office of Land Management. Oversees MnDOT's ROW Acquisition, Property Management, Utility Agreements, and Utility Permits sections.
(Article by Rosemary Jones, SR/WA, POC-North)
Updates from Connecticut
Updates from Delaware/Maryland (DelMar)
Delaware
Maryland
Updates from Maine
Updates from Massachusetts
Updates from New Hampshire
Updates from Ohio
Updates from Pennsylvania
Updates from Rhode Island
(Article by Dave Leighow, POC-West)
Updates from California
Updates from Washington
Updates from Nevada
Figure 1: Layne Patton received the 2014 FHWA Realty Staff Excellence Award
Other Updates
(Article by Mike Jones, Senior Member International ROW Association [SR/WA], POC-South)
By the time you read this, maybe winter will finally be over… it sure was fun, wasn't it?
For some reason, cold temps, snow, wind, and ice just don't seem to have the same allure for a lot of us as we get a little more "seasoned" - pardon the pun.
OK… on to news and observations about some of the happenings in the Director of Field Services Southern region (DFS-South).
Congrats…
I'd like to start off by congratulating two (Count `em - 2) DFS-South Realty Officers for being chosen as recipients of FHWA Administrator's Awards.
First, Tammy Keeley of the Alabama Division received her award in recognition of "her exemplary leadership and sustained commitment to the Alabama Strategic Implementation Team." Way to go, Tammy!
Figure 2: Tammy Keeley (left) and Mike Dawson (right) both received FHWA Administrator's Awards in recognition of their accomplishments.
Mike Dawson, in the North Carolina Division, was also recognized with an Administrator's Award for Superior Achievement. This category recognizes individuals for their initiative and dedication to accomplishing significant results that advance our mission, and is the highest honor awarded by the Administrator. Mike was recognized for "his significant contributions to North Carolina's Realty Program and for his leadership and guidance across all areas of the ROW Program over many years." Well deserved, Mike!
A limited number of these awards are presented each year, and the fact that two of our own were recognized in the same awards cycle speaks to the quality of our Division Realty staff. Again, kudos to Tammy and Mike. Those of us who interact with our Divisions regularly know that there are many others out there who are deserving of recognition. We look forward to seeing more "Realty" names on the list next year.
FHWA SIP - National ROW Review
As everyone knows by now, the PY14 SIP contained an item that tasked HEPR with carrying out a multi-year national review of the Division Offices' Realty stewardship and oversight (S&O) activities. The expectation is that within five years, we will have reviewed the S&O practices in all 52 Divisions. In PY14 we reviewed successful practices in 10 Division Officess. In PY15 we'll be reviewing 12 more Division Offices.
We sincerely appreciate the excellent cooperation we received from the participating Division Offices last year. I would like to personally thank the participating Division Office Realty staff located in the Field Services South: Brian Telfair (Florida), Rick Mangrum (Mississippi), and Jeff Robinette (West Virginia). We are very much looking forward to visiting with this year's DFS-South participants (Arkansas, Kentucky, and Tennessee) in the coming months, and learning about their successes.
Valuation Program Reviews and Valuation Technical Assistance Workshops
Appraisers can be an opinionated lot. No surprise there, right? (I can say that because I've been one for over 20 years now.) In many respects, the appraisal discipline appears to be the one area of our Realty Program where there is the greatest divergence among the States' statutes, case law, regulations, policies, and procedures. In my experience, most, if not all of the States where I have participated in reviews have certain nuances or subtleties that differentiate their valuation program requirements and procedures from those of other States.
Over the last year, John Turpin and I have each had the opportunity to conduct Valuation Technical Assistance Workshops in various Division Offices (in some cases, with assistance from Marshall Wainright in the Resource Center). I have conducted workshops in Mississippi and North Carolina. In June, Marshall and I jointly delivered a two-day session in Alabama. I want to thank the Division Offices for giving us the opportunity to provide those workshops. I also want to applaud Marshall and Michele Palicka for their many training efforts across the entire Realty Program.
As of this writing, and since our last edition of the newsletter, I've also had the opportunity to participate in Appraisal/Appraisal Review/Valuation Waiver Process Reviews in South Carolina (with Marshall) and Louisiana (with John). We'd like to thank Jessica Hekter (South Carolina) and James Hall (Louisiana) for inviting us to assist them in those reviews.
We encourage our Division Offices to include one (or more) licensed or certified appraisers in presenting valuation technical assistance workshops, and on the review team whenever you are planning a review of a State DOT's or LPA's valuation program or processes. We continue to receive feedback confirming that having licensed or certified appraisers conduct the valuation workshops and participate as review team members provides added credibility to those activities.
John Turpin and I are both Certified General Appraisers. In the case of the workshops, the fact that the instructors are certified appraisers usually qualifies attendees to receive recertification credit for their appraisal licenses-a key selling point in getting appraisers to attend professional training courses.
John and I are both available to assist our Division Office partners with reviews and training in the valuation areas of the Realty Program. Give either of us a call and we will be glad to work with you. Mike is available at (202) 493-0350 and John is available at (202) 366-5853.
(Article by Maggie Duncan-Augustt, POC-Mid-America)
Updates from Illinois
The Illinois DOT is actively working on acquisitions for the Elgin O'Hare West Bypass project, which is one of FHWA's Projects of Corporate Interest.
Updates from Wisconsin
The Division Office is hoping to fill its vacant Realty position in summer 2014.
Updates from Iowa
HEPR's Carolyn James conducted two 2-day sessions of LPA training. The LPA courses were well attended and received great feedback. The LPAs are working to have HEPR return for additional training.
Updates from Michigan
Dave Williams is now in the Resource Center in Baltimore. The Michigan Division hopes to have an Environment/Realty Specialist on-board by the end of the summer.
Updates from Minnesota
We would like to welcome Mary Walker-Johnson, who is taking on realty as a collateral duty. Mary has been the Civil Rights Specialist in the Division Office and is looking forward to her new realty duties.
Updates from Missouri
The Division Office is planning for an upcoming Outdoor Advertising Control review this August.
Updates from Oklahoma
The Oklahoma Division Office is working with the Oklahoma DOT on functional replacement of two State facility yards.
Updates from Texas
The Division Office assisted Texas DOT (TxDOT) with its efforts to remove a 40-ft-high non-conforming sign, which was located along a controlled route in Marfa, Texas. The sign has now been removed and relocated to a Dallas museum. Currently, the Division Office is working with TxDOT on relocating a leased United States Postal Service facility.
Updates from North Dakota
The rapid growth in the shale oil industry in North Dakota has greatly increased land values and the number of condemnations in recent projects. The Williston Bypass is one current project that includes condemnations. The project could possibly impact one or more of the many "crew camps" (temporary housing for the oil workers) that are popping up throughout the area due to the oil boom. The Division Office will be working closely with the State DOT to identify any possible relocation issues and/or concerns. The Division Office also recently welcomed Stephanie Hickman as the new Realty contact for North Dakota. Stephanie will be assuming the Realty duties of Mark Schrader who recently accepted a position at the Federal Aviation Administration. Stephanie, who is the current Planning and Program Development Team Leader, is excited about learning all she can about the realty program.
(Article by Michele Palicka, FHWA Resource Center and Georgia Division Office)
Marshall Wainright and Michele Palicka have been busy delivering ROW training and technical assistance nationwide in cooperation with HEPR and FHWA Division Offices. They have enjoyed meeting and working with new and seasoned Realty Officers from around the country as they ensure the Federal-aid Realty Program is in compliance with Federal and State regulations and laws.
In March, Marshall and Michele attended the Annual Environment/Realty Technical Service Team meeting in Baltimore, Maryland. The meeting covered a large range of topics, including Workforce Planning at FHWA and an educational presentation from the Office of the Chief Counsel/Eastern Legal Services on recent FHWA litigation. They learned a great deal about upcoming policies and programs and are excited about the future of the Realty Program at FHWA.
This past February, the Realty Resource Center team had the pleasure of presenting at an FHWA Essentials of Innovative Finance Workshop in San Juan, Puerto Rico. The FHWA Puerto Rico Division Office hosted the workshop, which the FHWA Office of Innovative Program Delivery organized. The realty presentation focused on current and future ways to extract value from transportation ROW. As State DOTs face tight budgets and increased costs, many are looking to create new revenue streams from currently owned ROW assets, and innovative ways to pay for current highway programs through sponsorship programs. Some States are exploring opportunities to benefit society and the environment by using the ROW for alternative energy. The San Juan presentation highlighted programs and ideas currently in use by various State DOTs in the United States. To learn more about these initiatives, please contact Michele Palicka.
The Realty Resource Center team created and presented a one-day training on "Negotiation Success in Right of Way." The class was requested by a State DOT that believed the recent turnover in its staff warranted an introductory class that provided the knowledge and skills needed for effective negotiations on Federally funded transportation projects. The newly created course is highly interactive, allowing attendees to practice their negotiation skills in a safe classroom environment. The class material discusses the importance of communication, listening, and empathy in effective negotiations. The course also covers different negotiation and conflict resolution styles as well as the basic Federal acquisition policies. If you are interested in learning more or would like to host this class in your State, please contact Marshall Wainright or Michele Palicka.
If you have other training or technical assistance needs, please contact the Resource Center. The Resource Center can create and present customized training if you or your partners have specific needs. Please contact any member of the Resource Center realty team, including Marshall Wainright at (404) 562-3692, Michele Palicka at (404) 562-3918, or Chrisy Currier at (512) 536-5931. We look forward to hearing from you!
"Scope of work" (SOW) is an appraisal topic that has received increased attention in recent years in many venues, including the following:
The successful negotiation for property rights in connection with a Federally funded project often depends on the quality of the appraisal product. The development of an appropriate SOW is a critical step in every appraisal assignment, and the statement of the appraisal problem is the starting point that informs the SOW.
When conducting project or program reviews, it is not unusual for FHWA to discover problems which trace back to the appraisal and indicate flaws in the SOW. Keep reading below for an interesting and informative discussion among a panel of State DOT Chief Appraisers on how acquiring agencies and appraisers can develop appropriate SOWs that meet Federal and State requirements.
Jeff Jones of ALDOT, John Kluge of Caltrans, Bernie Baldassaro of MassDOT, and Michael McCall of VDOT all graciously volunteered their time to participate in this discussion.
Please describe the process that your agency follows in developing an appraisal SOW.
Jeff Jones (ALDOT): Alabama is smaller than some other States, so I am involved in all SOW decisions on every project on a tract-by-tract basis. I ask our divisions to contact certain appraisers for certain tracts and then we tell them how we envision the scope. We will soon reorganize from nine divisions to five regions, and once that happens I hope to delegate more responsibility to regional staff in framing the SOW.
John Kluge (Caltrans): We use staff appraisers for the most part, and we do not have a set SOW; we try to avoid boilerplate language. We will bring in independent appraisers for specialty situations such as loss of good will, and in those cases we require a formal SOW. For situations where a staff appraiser does the work, it is up to the appraiser and supervisor to outline the SOW and level of effort based on the complexity of the appraisal problem. We do not ask for a specific section in the report for SOW, but certainly the components of a SOW that would appear in the report, such as a discussion of rights, the requirement (full/part take), subject, and market. Many of our appraisers are originally from the private sector, so they still include a formal section for the SOW in their reports out of habit. Some, but not all staff appraisers are officially licensed or certified, since California is not a mandatory licensing State.
Bernie Baldassaro (MassDOT): Like California, most of our appraisal work is done by staff appraisers. We also have a pool of fee appraisers that we can call upon, but most work is done by staff. I or a review appraiser will assist in developing the SOW. The first step in our process is to perform an appraisal complexity analysis. The purpose is to identify any appraisal related issues and to define the appraisal problem. This begins with an office review, including a review of the proposed ROW plan, title report, property interview record, and other related data collected by our project section (acquisitions office). We will then visit the project locus and conduct an onsite plan review in order to confirm the physical features of the affected property and conduct a preliminary inspection of the proposed parcels to be acquired. We will also review zoning, planning, and building records at municipal offices or websites. We then analyze all data and define the problem in the SOW, then convey our findings to the appraiser.
Michael McCall (VDOT): Our scoping starts prior to appraisal assignments. We look at complexity and anticipated damages. If the appraisal will be done in-house we work directly with the reviewer and decide whether the assignment requires an appraisal waiver, a simple report, or a narrative report. When utilizing fee appraisers we will give them a summary of all parcels with notes about unusual issues or anticipated damages. We ask our staff review appraisers to work with the fee appraisers to manage the scoping process. Our typical approach is more reactive than proactive, but as the early appraisals come in, the review appraisers discuss the SOW and determine whether it is adequate.
If relevant new information or data is uncovered during the appraisal process, how does your agency amend the original SOW?
Jeff Jones (ALDOT): We use fee appraisers for all anticipated acquisitions over $35,000. If new information comes to light, each fee appraiser contacts the ALDOT Division Office to request the change in writing (which could take the form of an email) and then we officially respond. We are very specific on what the scope should be, and then if there are changes we are very specific on that as well. If any improvements are being acquired in the scope, we require the appraiser to schedule a meeting onsite with a relocation staff member from the ALDOT Division Office.
John Kluge (Caltrans): New information or data would take a few different forms. There may be a change in the market or a change in requirement itself. That is a very common occurrence for us. For example, the terms of a temporary easement might change relative to things such as the length of time, area, etc. Caltrans' ROW engineering department initiates all changes in requirements and issues a new appraisal map. The senior appraiser would review that, and if it were a minor change, the appraiser would simply add a small addendum to the original report (a memorandum of adjustment) to reflect the changed requirement and concluded value, as appropriate. At the same time they would update the appraisal date of value. The appraiser would review the market again. If there were an extensive change in scope, we would do an entirely revised report instead of an addendum. The scope would describe the changes from the original problem. There would be a new date of value, and the report would be titled "revised report" to indicate this. If we are using an independent appraiser for a project, we would require an entirely new report, start to finish, as required by USPAP. The report would include a statement to say that it supersedes the prior one.
Bernie Baldassaro (MassDOT): Changes could originate from two areas. They could be proposed by the agency or proposed by the appraiser. In the cases where our agency determines that changes are necessary, such changes shall be communicated to the appraiser in writing.
Michael McCall (VDOT): If it is in-house, the appraiser just makes any necessary adjustments. If a fee appraiser is doing the work, then we ask them to submit the request for changes in writing. Then we amend the contract and we ask them to submit a narrative report instead of a short form report. If there is a major difference, then we will generate a new assignment with a new scope.
Does your agency require that the SOW be included within the appraisal report or appendix?
Jeff Jones (ALDOT): Yes. However, we have an ongoing problem with appraisers that merely insert boiler plate language for that. If that happens we resolve it during our review. We have a template for where the SOW should appear in the report.
John Kluge (Caltrans): We do not have a specific template or form in our reports that is specifically called a SOW. However, the components of the SOW appear in our report sections on 'defining the problem,' 'description of problem,' 'construction in the manner proposed,' and 'project description.' Sometimes our licensed staff appraisers add an explicit SOW section anyway. When we use independent appraisers the request for the contract will include specific requirements for the report and the independent appraiser will include that statement in the beginning of the report as the SOW.
Bernie Baldassaro (MassDOT): We do include the SOW in the body of the appraisal. This is MassDOT policy and a USPAP requirement. We have certified, licensed appraisers reviewing the reports, so we definitely wanted the reports to be USPAP compliant. There is some boilerplate language that the appraiser can use and modify as needed. In defense of boilerplate language, much of it does seem to apply to many non-complex appraisal issues.
Michael McCall (VDOT): Yes, and we use boilerplate language that we modify as necessary based on the complexity.
Briefly discuss the level of specificity that you would consider "appropriate" in the SOW for a complex project.
Jeff Jones (ALDOT): We can get very specific on more complex ones. For example, we may specify the appropriate approaches and/or methodology to include in the analysis. Many appraisers say that they can appraise certain property types, but we try to be specific to make sure that we get someone qualified for the property type.
John Kluge (Caltrans): It depends. Every appraisal is different. For example, if we are looking at vacant agricultural property, you will have to do the same level of work whether it is total or a partial take. A specific amount of investigation will be necessary for the agricultural market itself. California has a diverse agricultural market, so you cannot make assumptions. For a commercial or industrial market, the level depends on the scope of the particular market. An industrial property may have a regional market, or it may be a worldwide market. That influences the scope. On occasion, we have to impact golf courses. If it is a well-known course, that may be an international market. For a partial take, it is necessary to examine the total take originally anyway, and that would be part of the appraisal. The appraiser and the supervisor work together to verbally define the SOW, consistent with the Right of Way Manual guidance for a given assignment.
Bernie Baldassaro (MassDOT): Yes, I agree. The assessment of total take would be part of the evaluation for a partial take where there would be severance damage to the remainder of the property. A partial take may require an expanded scope to analyze the highest and best use for the property both prior to and subsequent to the acquisition and the effect of the partial acquisition on the remainder of the property. If this comes to light during the appraisal process, this would require a change in the SOW. It could also be something as simple as a commercial property where all three approaches to value would be in both scenarios; this may not be the case with an older property where the cost approach may not be relevant.
Michael McCall (VDOT): Many scope-related questions are addressed by the selection of the appraiser at the beginning. We have to hire people that we know have the expertise. For example, how are we going to address business versus real estate? How will we delineate real estate versus personalty? There are some agency guidelines that we have on classifying these elements to be consistent and fair on payments. In a partial taking, the focus is on assessing damages. We ask appraisers to describe the story behind their analysis of highest and best use before and after. We ask them to explain why they are leaning in one direction or another, and what they would compare it to in order to justify the assessment of the impact on the property.
Does your State ROW or appraisal manual set forth the requirements for appraisal SOW? For an appraisal review SOW?
Jeff Jones (ALDOT): Yes, it includes a section on SOW. As for review SOW, we specify that the reviewer must be competent to review at the level of the scope of the appraisal. We also have required review forms that detail the scope in general. If there are atypical issues, they can be detailed in the appropriate file.
John Kluge (Caltrans): As I mentioned, our manual does not set forth specific requirements for the SOW, but it does talk about defining the problem, etc. California statutes do not include anything specific on SOW. We rely on the CFRs and USPAP.
Bernie Baldassaro (MassDOT): Yes, and that would be included in both appraisals and review appraisals. We are in the process of revising our manual, and we may improve the section on SOW.
Michael McCall (VDOT): We do not specifically talk about SOW in the manual, but we do have a great deal of detailed discussion on what we expect to find in the SOW (e.g., fencing issues, use of assignment conditions, extent of comparable research, level of detail, interim use, etc.). This is where we set the expectations for a lot of elements of the appraisal process that are related to scope. We also have an appraisal guide, aside from the manual, that goes into greater detail.
Is there anything in your State's statutory or case law, State regulations, or agency policy which affects the development of an appraisal SOW performed for your agency?
Jeff Jones (ALDOT): Yes, we have a law that specifies that the owner should have an opportunity to inspect a property with the appraiser. State law also specifies the inclusion of tenant-owned improvements. Our manual also includes 49 CFR Part B. We also have a statutory definition of fair market value.
John Kluge (Caltrans): We have a State statute that defines fair market value and guides the appraiser through the major issues. Our statutes do not specifically reference SOW.
Bernie Baldassaro (MassDOT): We have case law outlining the definition of fair market value. Our State law also requires an appraisal for every taking. A recently adopted policy is to instruct appraisers to make it a condition of their report (hypothetical or extraordinary) that the subject be appraised "as clean." If it is determined that hazardous materials are present, then the agency will consider how to apply the cost of remediation on the appraiser's estimate.
Michael McCall (VDOT): Our statutory case law does not address SOW specifically, but we have had many changes that do impact SOW. We had a constitutional amendment that addressed lost profit and access issues. We also have a statute that dictates that for a total take the acquiring agency should award the assessed value if it is higher than the appraised value. The constitutional amendment addresses situations when appraisal issues overlap with lost profit issues. We explained to appraisers that we would call upon them to delineate the part of the claim for lost profits that they had already accounted in the appraisal. We offer training sessions on these topics.
Please share one or more SOW "successful practices" and/or "lessons learned" with our readers.
Jeff Jones (ALDOT): I have learned that the SOW is critically important, and it is important to include details at the beginning of the process. I used to work as a reviewer for banks, and one in particular would have someone other than the reviewer set the SOW, which led to many problems. Since I returned to the ALDOT I have emphasized the importance of the SOW and reviewer involvement in the SOW.
John Kluge (Caltrans): I agree with the importance of a detailed SOW at the outset. I have learned that it is not advisable to let the attorneys determine the SOW. Instead, the client and the ROW appraisers should be looking at the problem and its definition. For example, one of our local transportation agencies was working with us to sell an excess piece of property, and an attorney added a sentence that the appraiser subsequently misinterpreted. The attorney wrote "unit value should be price per acre," intending that the value should be reported in those terms. However, the appraiser assumed that the property should be appraised on a "price per acre" basis, even though it was a medium density residential property, for which the market was based on density units. The resulting report would have been much clearer if the SOW was written more clearly.
Bernie Baldassaro (MassDOT): Yes, developing a SOW and defining the appraisal problem is an essential early step, because it uncovers issues and allows for open dialogue to proactively address those issues, improving efficiency.
Michael McCall (VDOT): I recently attended an AASHTO panel discussion where many of the issues came back to SOW and defining the problem. For instance we talked about appraisal waivers and short form appraisals. Appropriate scoping is critical to make those work. Also, as I mentioned before, if you are going to address the issue of damages, you need to have an understanding of the kind of analysis and depth of analysis required. We also discussed relocation issues as they relate to appraisal. That opened my eyes because we had previously not focused on that, but I realized in the discussion how important it is to ensure an understanding of the appraiser's responsibility for ensuring a well-implemented relocation.
When I returned home I participated in some continuing legal education here in Virginia and one session struck me again. Contrary to John's experience in California, we discussed the value of including an attorney in the SOW discussion. Many times legal input is necessary to understand the client's legal interpretation of an issue that may affect the analysis.
For example, there are laws in Virginia that dictate whether two different properties can be considered as one larger parcel. Other elements are not accepted by the courts in certain formats and interpretations, and it is good for the appraiser to know what those things are. Attorneys give advice and cite precedent that is the basis for guidance they are giving on how to treat a particular issue. Recently, this has been particularly important on issues related to access, as new language was introduced that would influence whether or not something is compensable.
As John (Caltrans) mentioned, sometimes you have to state something differently for legal purposes, but this does not necessarily mean that the appraiser should appraise the property any differently. A subdivision analysis is a good example of this, as the courts would not typically accept this language. We advise our appraisers to use the best approach at their disposal to appraise the property, and then state the conclusion in a way that it is not obviously related to that kind of developmental approach.
Bernie Baldassaro (MassDOT): I agree. Both legal and engineering advice can provide much insight in defining the appraisal problem and developing the SOW.
Michael McCall (VDOT): When they first asked me to talk about defining the problem at the Continuing Legal Education seminar I mentioned previously, I thought it was a boring topic, but this session and other sessions have helped me to realize that this is a universal topic and one that deserves some thought and attention. VDOT best practices include: expansion and clarification of the manual to address what the appraisers would need to know related to scope, and development of a guide that talks about those issues in greater detail, providing a more thoughtful, broad discussion of the issues. We also have a one and a half day course on "Introduction to VDOT Appraisal." Within that course we address the kinds of things that arise in ROW appraisals that are not typical in other types of appraisals. Everyone has a chance to ask questions and compare notes, and they learn what to do if they have a question in the future. The course has helped everyone communicate better.
Can you elaborate on the recent emphasis on access issues? What caused that?
Michael McCall (VDOT): A constitutional amendment has been causing some confusion, and we will likely be working to clarify it in court over the next few decades. The amendment refocused everyone's attention on addressing take, damages, and lost access.
Can you elaborate on the one and a half day course and the intended audience?
Michael McCall (VDOT): Yes, we show participants our plans and discuss terminology and interpreting profiles and cross sections. The course primarily targets outside appraisers. One of the main reasons for creating the course was that we wanted to be more proactive in outreach to women and minority appraisers. I pre-advertise each offering through the appraisal institute women and minority directory and then we send out notices to the appraiser institute chapters. The other method of outreach is to get mailing addresses for licensed appraisals, or obtain a listing on the appraisal subcommittee website, but that can be very cumbersome. We have been offering the course for three years now.
Do other agencies offer training courses for appraisers?
Jeff Jones (ALDOT): We offer one every few years. We also work with new appraisers closely on their first few assignments. Also, I am developing some topic-specific PowerPoint files that will be available on our website. This will allow appraisers to look at them at any time.
John Kluge (Caltrans): We have a two-week academy that we run for all new hires in ROW. This includes ROW legal, engineering, acquisitions, and appraisals. For appraisals, we have two and a half days on the fundamentals of appraising. We offer this once a year and sometimes twice. I teach part of it. We also have continuing education for all of our appraisers, including part takes, appraisal institute practices, conservation easements, etc. We have a list of required classes that all appraisers must take.
Bernie Baldassaro (MassDOT): We periodically hold a ROW academy for all staff. This is primarily for the newer staff members. We have them spend a few days in each section. We also highly promote continuing education through other organizations. Recently, we had an appraisal workshop in partnership with FHWA. All of our staff participated in the two-day workshop.
Is there anything else that anyone would like to add?
Michael McCall (VDOT): I appreciate that you held this discussion. This is a topic that deserves more attention and focus. It is much better to have a clear understanding at the outset rather than trying to fix things in the middle of a process. We talked about several components that contribute to an effective SOW, including:
While all of these elements are critical in optimizing outcomes, I think the most important aspect is including the conscious step of clarification between the agency and the appraiser and setting it out clearly in the report at the outset.
Figure 3: Tammy Keeley, Realty Officer for the FHWA Alabama Division Office
Tammy Keeley is the Realty Officer in the Alabama Division Office where she fields realty inquiries of all kinds. She is a direct communicator and has a particular knack for understanding diverse perspectives. She puts these skills to use on a daily basis as she strives to understand and balance the needs of ALDOT, property owners, and the Federal government.
Tammy recently won the FHWA Administrator's Superior Achievement Award for "exemplary leadership and sustained commitment to the Alabama Strategic Implementation Team." According to her colleagues, it was well-deserved, but Tammy herself was shocked to learn that she won the award. Tammy had participated on the team in the past, but this past year she served as leader and liaison between management and the staff team. Tammy instituted a structured and proactive approach that successfully inspired team members to engage more actively in the process. This is a prestigious accomplishment, but Tammy is most proud of her success in building relationships with ALDOT. Her rapport has allowed her to partner with ALDOT to articulate and address challenges.
Tammy started working in real estate in 1986, beginning with a local tax assessor's office in Georgia while she worked toward her bachelor's degree in sociology and business administration. One day, she happened to meet an employee from the Georgia DOT, and was intrigued to learn of opportunities there. Tammy applied for a job and started working on Federal-aid projects for Georgia DOT in 2000. In 2004, FHWA recruited her to join the agency as a participant in the professional development program (PDP). To this day, Tammy does not know how and why FHWA discovered her and decided to recruit her, but she is grateful.
In her spare time, Tammy loves to read fiction. She also enjoys the cost-effective hobby of saving money through coupons. Through the PDP program, Tammy learned that she likes to travel and there are many places in the U.S. she would like to visit. She is not necessarily drawn to the most obvious tourist destinations, but prefers to explore relatively unknown places, meeting interesting people, and learning how they live.
Tammy has a very strong connection with her family. Her mother is her hero, her best friend, her cheerleader, and her rock. She is also very close with her sister and two brothers. All of her siblings are close in age, and they all live on the east coast. They make it a point to get together at least twice a year, a tradition that they have maintained since their twenties. Their father passed away when Tammy was 16, and this devastating loss brought an already close family even closer.
With such strong family ties, it was a difficult decision for Tammy to leave her position at the Georgia DOT in 2004, mid-career and at age 40, and move across the country to join the FHWA PDP program. However, her family was incredibly supportive and encouraging from the beginning. The opportunity beckoned her, and she decided to seize it. Fortunately, after completing her first assignment in Washington State and then moving to California, she eventually moved to the Alabama Division Office in 2010. She has been happily settled there ever since.
Larry Goble manages the Land Services Section in FHWA's Western Federal Lands Office, (WFL), where he oversees the ROW and survey functions. In the past WFL did not combine those two areas, but in early 2014, WFL combined the staff in these two disciplines into the newly created "land services section." Larry assumed his current position as supervisor of that team in March 2014. According to Larry it is too early to assess the long term effect of this organizational change, but he is hopeful that it will ultimately result in a stronger and more resilient team
Figure 4: Larry and his wife volunteer as "Mr. and Mrs. Claus" for events during the Christmas season.
Larry is a professional engineer and a professional land surveyor. He began his Federal Highway Administration career in construction while working on a survey crew. Within three years he became a construction project engineer, and he had the opportunity to build many interesting projects, including some in Yellowstone National Park. From there he moved to the contracts section where he reviewed "plans, specifications, and estimates" (PS&E) and answered technical questions from bidders. He then moved into surveying and spent 12 years leading field survey crews and providing technical guidance on surveying issues. Prior to joining WFL, Larry spent some time working for the U.S. Forest Service where he focused on reconstruction in the aftermath of the Mount Saint Helens eruption. Eventually he made his way over to WFL when some friends from the Lions Club encouraged him to apply for a position there.
Larry and his wife met in college and have been married since 1977. They have four grown children and six grandchildren. Although all their children are now on their own, they stayed fairly close to home, so Larry is happy to report that they have many opportunities to see them all regularly. Larry and his wife enjoy maintaining a hobby farm where they raise horses and raise goats for show and for food. Larry also enjoys collecting and maintaining antique farming and logging equipment, which he uses on their 30-acre property. The youngest piece of equipment is from the 1960s.
Larry and his wife also really enjoy volunteering. For example, they volunteer as "Mr. and Mrs. Claus" for events during the Christmas season. For many years Larry enjoyed serving as an umpire for Little League baseball games. In recent years he has not done it as much, however, as he has found it more difficult as his eyesight has changed. Larry and his wife also spend quite a bit of time with two of their children as volunteers for the Clark County Fair Mounted Patrol. Riding around the perimeter of the fairgrounds on horseback gives them a very different perspective on this ten day event. As a change of pace, Larry also helps with an annual logging show in his small home town and helps with maintenance items on the Oregon Coast Scenic Railroad.
Teamwork has been very important to Larry throughout his life and career. For him, working with others makes projects fun and improves productivity. With such an emphasis on collaboration, he seems like just the right person to lead the new "land services section" at WFL.
Figure 5: Marsha Bayer, ROW Team Leader for the FHWA Texas Division Office
Marsha Bayer is the ROW Team Leader in the Texas Division Office, where she provides technical assistance to TxDOT and FHWA Division Office staff. In this position she reviews environmental documents, conducts project and process reviews, handles outdoor advertising and other ROW related programs. Marsha actually grew up in Texas, but left the State at the age of 19, and then lived in Colorado, California, and Washington D.C., before finally returning for a grand homecoming 26 years later in 2001. She has been in Texas ever since.
Like many in the realty discipline, she entered the field quite serendipitously. At the time she began, she was working for Caltrans, running the radio dispatch for mountain maintenance crews that dealt with snow removal and other issues. She happened to meet someone in the ROW office at Caltrans who suggested that she might be a good fit for realty. After applying for and accepting a job in the ROW office, she entered the Caltrans realty training program; this preparation served her well throughout the rest of her career.
After 15 years with Caltrans, Marsha decided to apply for a job with FHWA. Her husband was working in real estate finance at the time and the market in California was not good, so they were ready to make a move. In 1996, Marsha began her career with FHWA in Washington D.C., and then in 2001 she moved to the Texas Division Office. She enjoyed her time in D.C., but she had grown to miss the involvement on the front lines of projects, and she was glad to get back to that work in Texas.
Marsha and her husband Garry are fortunate in that there are many hobbies that they enjoy together; their love of exploring has led them to pursue many different activities. For example, when they lived in the high desert of California they used to race sled dog teams. Marsha's team consisted of two Siberian Huskies and three Alaskan Malamutes. To train they would have to take the dogs out at four in the morning so that the temperatures would be low enough to run the dogs on wheeled training rigs along the desert trails. Texas is not a promising location for sled dog racing so they have not done this recently, but they do still enjoy playing golf, which they have been doing for 30 years. At the moment, they live next to the 13th green of a golf course.
About 10 years ago, Marsha and her sister began researching health and nutrition. As a result, Marsha and Garry have progressed through a number of lifestyle changes to improve their health. For three years they ate only a vegan raw food diet, and to this day they still primarily eat raw foods. This burgeoning interest led Marsha to become a certified raw food chef; she still occasionally teaches classes in her home. She and Garry also started an online health food store that Garry currently operates. Marsha and Garry have been married for 33 years, and they have a 29-year old daughter and 2 grandchildren.
Marsha feels very fortunate to have a career with FHWA in ROW and she has learned from many informal mentors during her time at the agency. In particular, Pete Nyberg, former Realty Officer in the Louisiana Division Office, was an influential mentor for her. He has been retired for almost a decade, but she still hears from him on occasion. Despite having worked in ROW for 32 years, Marsha is continually amazed at the challenging ROW issues, whether it is a difficult relocation, or an illegal sign in the middle of the Texas desert. She has learned to expect the unexpected.
Figure 6: Marshall and his son Jonathan
Marshall Wainright is the Team Leader of the Environment and Realty Technical Service Team at the Resource Center in Atlanta, Georgia. Michele Palicka is a full-time member and Chrisy Currier also participates on the Resource Center realty team on a part-time basis. Marshall works to balance the workload between the three of them in order to coordinate Resource Center support to the Division Offices and HEPR. The Resource Center primarily provides technical assistance to Division Offices, but Marshall occasionally also receives inquiries from other agencies. The Resource Center also helps to respond to requests that HEPR cannot meet due to time or budget constraints.
Marshall had originally planned to pursue a career in law enforcement, but there was a hiring freeze when he graduated from college. Instead, he went to work for a national restaurant chain where he had worked throughout high school and college. When he got engaged to his wife, he tried to transfer to another location in the restaurant chain in Tennessee to be with her, but it was not possible, so he found several other jobs, including substitute teaching, construction, and building log homes, until a friend told him that the Florida DOT (FDOT) was looking to hire new employees with people skills. Having dealt with many difficult customers in the restaurant industry, Marshall had certainly honed his people skills. He applied for a position with FDOT as a real estate agent and learned a great deal about the field in a short amount of time. In 2003, he left FDOT to accept a position with FHWA Headquarters in Washington D.C., where he worked as the relocation program manager until transferring to the Resource Center in 2012.
When Marshall moved from Headquarters to the Resource Center it was one of the most difficult decisions that he has ever made. Ultimately, he decided to move to the Resource Center to be closer to his parents in Georgia and because he was compelled by the challenge of assuming a brand-new position within the Resource Center. He has found it to be a great learning opportunity for a variety of reasons. He enjoys working more closely with the Division Offices than he did in his prior position, and he has been able to work more closely with staff in other disciplines, such as environment, planning, and engineering. Although he is not working in law enforcement as he once thought he would, Marshall has achieved his goal of working for the Federal government, and the realty field is indeed related to law and policy. Marshall feels very fortunate to work at FHWA, and he enjoys and appreciates his colleagues.
In the past, Marshall enjoyed playing in paintball games and tournaments, and he even served as a referee. Recently, he has not played paintball at all. Instead he spends as much time as possible with his wife, Karen, and their eight year-old son, Jonathan. They enjoy camping, hunting, fishing, and other outdoor activities together, and they are also heavily involved with their local church. Karen teaches Jonathan at home, and they also participate in joint activities with other homeschool children and parents, such as field trips and sports. This arrangement has been beneficial on many levels. As a kinesthetic learner, Jonathan learns best by doing. As an occupational therapist, Karen understands this concept and is able to incorporate it into lesson plans. Marshall can engage in the educational process in a way that would be difficult if not impossible in a traditional school setting. Eventually, Karen and Marshall will send Jonathan to a more traditional school setting, but they have not yet decided when that will be.
Figure 6: Virgil Pridemore, Director of the FHWA Office of Real Estate Services
Virgil Pridemore became the Director of HEPR in early 2014. He has over 29 years of ROW management experience in the public and private sectors. Prior to assuming his duties with FHWA, Virgil served for more than three years as the Right of Way Branch Manager for NCDOT. While serving in this position, Virgil was responsible for overseeing the development and implementation of ROW policies and administering all phases of ROW projects and activities. In addition, he established collaborative partnerships to address highly sensitive and complex issues including North Carolina Turnpike Authority projects and American Recovery and Reinvestment Act rail projects. Previously, Virgil served for 14 years as a regional ROW Program Manager with an international engineering firm, 7 years as Vice-President of a ROW acquisition services firm in Florida, and 5 years as the Senior ROW Agent with a regional gas pipeline company in Louisiana, Mississippi, and Alabama. In these positions, he provided management and technical consultation to Federal agencies, State and local governments, and the private sector in improving ROW program effectiveness for highway, aviation, transit, power line, and pipeline projects.
Now that he is working for FHWA, the biggest adjustment for him has been the shift from a focus on program delivery to a focus on policy. Virgil notes that it is very important for HEPR to build relationships with other offices and units within FHWA, such as the Office of Planning and the Office of Project Development and Environmental Review, as their work is all interrelated. He also notes that succession planning is another major priority for HEPR, as many realty staff in FHWA will soon be eligible for retirement.
Virgil did not always plan to work in ROW. In the 1970s, he was working in institutional food sales when he learned of the profession through a friend. He began his career in ROW with FDOT as a ROW trainee, and he has stayed in the field over the years because he enjoys the satisfaction that comes from helping people.
Virgil enjoys spending time with his family and, in particular, his four year-old granddaughter. He also enjoys fly fishing and is a big sports fan. He especially likes to watch hockey. Virgil and his wife live in Raleigh, North Carolina, which is where both of their sons and their respective families live as well. Due to the long commute, he spends most weeknights in D.C. and returns home on the weekends. Virgil likes Raleigh better than any other place he has ever lived. He finds it to be the perfect size and remarks that it offers numerous family-oriented activities.
For a listing of Planning, Environment, and Realty program meetings, events, and NHI training opportunities, please visit: www.fhwa.dot.gov/hep/calendar/.
[1] Contact HEPR for a recording.
[2] Contact HEPR for a recording.
