The page you requested has moved and you've automatically been taken to its new location.

Please update your link or bookmark after closing this notice.

Skip to content U.S. Department of Transportation/Federal Highway AdministrationU.S. Department of Transportation/Federal Highway Administration
Office of Planning, Environment, & Realty (HEP)

Right-of-Way Scans

Domestic Scan Program: Best Practices in Right-of-Way Acquisition and Utility Relocation

4.0 Texas

4.1 Project Context

Metropolitan areas throughout Texas have been growing rapidly, including Austin, which boomed in the 1990s and has continued to grow. Transportation improvements have been needed immediately, but inadequate funding is available from traditional sources. The funding that is available must be distributed throughout the State for geographic equity. As a result, new transportation needs in the booming metro areas are increasingly being met by toll facilities and through other innovative finance methods. Tolling is permitted and already used in 20 projects statewide, and TxDOT is increasingly entering into public-private partnerships to design, construct, and operate additional toll facilities. Pressures to address transportation needs in a timely manner - as well as the unique opportunities and constraints provided by public-private partnerships - have led to a number of innovations to the ROW acquisition and utilities relocation and adjustment processes in Texas.

In 2000, the legislature passed authorizing legislation to create and fund the Central Texas Turnpike System (CTTS) in the Austin region, and the governor established this as a high-priority project. The CTTS is essentially the largest design-build project in the nation. The scan visit focused specifically on innovative right-of-way and utilities practices employed to expedite the development of the initial phases of the CTTS by TxDOT and its contractors. The projects included for review and discussion are located in TxDOT's Austin District and include State Highway (SH) 130, Loop 45, and Loop 1 in Austin and its suburbs, which together comprise the CTTS 2002 Project.

The CTTS 2002 Project includes segments 1 through 4 of SH 130, which will be a new 49-mile tollway located east of I-35 through Williamson and Travis counties, extending from I-35 north of Georgetown to U.S. 183 southeast of Austin. Together with SH 45 North and the Loop 1 Extension into Austin, the entire CTTS 2002 Project includes a total of 65 miles of new roadway. Initially, SH 130 will be a four-lane divided facility with five major interchanges. Ultimately, SH 130 may become a six-lane facility. Construction of SH 130 involves 30 million cubic yards of earthwork, 2.7 million square yards of concrete pavement, 1.7 million tons of asphalt pavement, 590,000 square feet of retaining walls, 123 bridges, four mainline toll plazas, and 30 ramp toll plazas. The toll plazas contain as many as 22 lanes and are located on 1,000 foot width right-of-way, allows for the installation of utilities as well as accommodation of future transportation options such as rail.

The SH 130 project is being developed and constructed under an Exclusive Development Agreement (EDA), signed with the developer in June 2002. This type of project in the future will carry the nomenclature of Comprehensive Development Agreement (CDA). These terms are the Texas equivalent of design-build. Under a CDA utilizing the concession model, the private partner secures their own financing in exchange for the right to collect tolls for 50 years. For the CTTS 2002 Project, TxDOT contracted with a private team known as the "developer" to finance, design, build, and operate the toll road system.1 The CTTS development contract included three fundamental principles: 1) the product is a state highway that is owned by the State; 2) the developer must comply with all Federal and state requirements; and 3) the Texas Attorney General is responsible for eminent domain proceedings.2

In addition to the developer team, TxDOT contracted with a general engineering contractor to provide independent oversight, design review services, administrative support, and other functions. The contractor's scope included ROW and utilities support. This contractor team was considered an extension of TxDOT and was collocated with TxDOT offices.

Construction of the 65 miles of new toll roads will cost approximately $2.9 billion, including ROW acquisition, utility adjustments, design, and construction. ROW costs represent approximately $575 million of this amount. With the addition of required reserve funds, interest, insurance and issuance costs, the total estimated project costs are $3.6 billion. Innovative financing solutions include a $2 billion toll bond package and a $900 million Transportation Infrastructure Finance and Innovation Act (TIFIA) loan. State and local funds also are contributing to the project. Loans and bonds will be repaid from toll revenues. Tolls will be set by the Texas Transportation Commission and are expected to fall in the $0.11 to $0.18 per mile range.

The first notice to proceed was issued in July 2002. Construction of the CTTS 2002 Project began in October 2003 and the entire project is expected to be open to traffic by December 2007. The financing techniques, coupled with the Exclusive Development Agreement, are expected to accelerate completion of SH 130 by as much as 25 years, compared to what would have been possible with public financing only. On June 8, 2006 Texas Governor Rick Perry and the U.S. Secretary of Transportation announced the early opening of portions of the CTTS. According to TxDOT, the completed portion of the project is one year ahead of schedule and $400 million under budget.3

SH 130 represents an initial segment of the proposed Trans-Texas Corridor system, a network of transportation facilities that would span the State. Similar to the CTTS system, the Trans-Texas Corridors would be designed and built through public-private partnerships. TxDOT's experience with ROW and utilities through the CTTS project should provide valuable information and lessons learned to support further development of the Trans-Texas Corridors.

Top of Page

4.2 Policy Context

With respect to ROW acquisition, Texas is a "single-offer" state. Property owners are made an offer based on an assessment of the property's fair market value. The owner has the option to accept the offer or propose a counteroffer. If an agreed purchase price cannot be reached, condemnation proceedings are initiated to determine a fair value through the court system. As soon as the State deposits the amount of the award with the court, it takes possession of the property and can commence construction. The State's ownership of the property and determination of the final purchase price are then resolved through the eminent domain court process. More details on the Texas ROW acquisition process are provided in the sidebar.

Policies with respect to utility adjustments were established by the state legislature, unique to toll projects. The legislature included a provision for the CTTS that allowed for 100 percent reimbursement of costs to utilities for adjustments. This was a special case authorized by the legislature for toll roads only, which established that "utilities shall move at the direction of the (Turnpike) Authority." Utilities that do not move in accordance with a specified date may be held liable for adjustment costs. If necessary, the State may perform the adjustment work and even take over the utility's assets.

Treatment of ROW and utilities within the design-build contracting approach varies by state. In some states, the state acquires the ROW needed for a transportation project before awarding the design-build contract. In others, the state may choose to place the responsibility on the contractor to acquire right-of-way and make utilities adjustments. In TxDOT's CTTS 2002 Project, the department included ROW acquisition and relocation services, as well as utility adjustments, in its contract with the private toll road developer.

Top of Page

4.3 Innovations

The high visibility and political support for the CTTS project provided strong incentives to develop innovative solutions and complete the project in a timely manner. In some respects, TxDOT's ROW and utilities innovations have much in common with FDOT District 5's approach: a focus on teamwork, cross-disciplinary collaboration, direct communication, clearly defined processes, tracking systems, and early stakeholder involvement. In other respects, TxDOT's tools and methods reflect the Texas statutory environment as well as the CTTS project's design-build and public-private partnership context.

TxDOT Right-of-Way Acquisition and Relocation Assistance

Right-of-Way Determination and Identification of Property Owner
After the general alignment of the project is determined, surveys are conducted and specific property needs are determined. A title report, property description, and land/parcel maps are created. Property owners are identified based on this information.

Right-of-Way Appraisal and Offer
Affected property owners are sent a letter identifying the need for their property. The letter introduces the consultant who will handle the acquisition and relocation process on behalf of TxDOT.

Next, the appraiser contacts the property owner to request permission to enter the property to conduct an appraisal. The appraisal is the basis for determining the property's fair market value. The property owner may accompany the appraiser on the property inspection.

After TxDOT's review and approval of the appraisal, the property owner will be provided with a written offer in the amount of the approved value as well as a copy of the appraisal report. If the property owner disagrees with the appraisal value, a written counteroffer may be submitted. It should include a specific dollar amount with information supporting the counteroffer. Only one counteroffer may be submitted. The counteroffer will be reviewed by TxDOT and the property owner will be notified of the decision.

Purchase or Condemnation of Right-of-Way
If a property owner accepts the offer by TxDOT, or if TxDOT accepts the counteroffer, purchase documents are prepared and payment is issued. If an agreed purchase price cannot be reached, condemnation proceedings are initiated.

In condemnation hearings, the court will appoint three disinterested landowners to serve as special commissioners and a hearing will be held to determine the value of the property being acquired. During the hearing, the property owner and the State will present documentation supporting the value of the property. The commissioners will determine the value of the property and file their decision with the court.

As soon as the State deposits the amount of the award with the court, it takes possession of the property.

If either party is dissatisfied with the amount, objections must be filed within the time limits prescribed by law and the case is tried in the same manner as other civil cases. The basic issue decided in eminent domain cases is just compensation for the property being acquired.

Relocation Assistance
For those affected by the project, TxDOT provides payment and services to aid in the move to a new location. Relocation assistance is available to families, businesses, farmers, ranchers, and nonprofit organizations displaced as a result of the project. This applies to tenants as well as owners occupying the property.

Before a person or organization is required to move, they will be given adequate time to find other housing or business accommodations. Each of those affected will be given written notice and a date to vacate. Property owners will be given at least 90 days written notice of the date by which they must move.

Property owners eligible for relocation benefit will be provided with a relocation assistance booklet. Those eligible for relocation benefits should not move until they have been contacted by a relocation assistance counselor and have established eligibility for possible relocation benefits. Moving prematurely may result in forfeiture of these benefits.

Texas Department of Transportation
October 17, 2002

Incentives and Risk Management in the Design-Build and Public-Private Partnership Process

TxDOT has found that the design-build concept is very effective in accelerating project completion. Under TxDOT's development agreements, the developer has the financial incentive to complete ROW acquisition and utility relocation in as timely a manner as possible. TxDOT's contract with the developer on the SH 130 project provided incentives for meeting "guaranteed completion" milestones of $7,500 to $10,000 per day, as well as disincentives of $35,000 to $50,000 per day for failure to meet these milestones.

Under the SH 130 development agreement the toll road developer was responsible for all utility-related costs, providing an incentive for creative design solutions. For example, a 138 kilovolt electrical transmission line on a private easement that needed to be moved was relocated to TxDOT right-of-way, since opportunities to relocate back onto the private easement were limited due to platting of adjacent property into residential and commercial lots as well as historical properties in the area.

Limiting the developer's risk was a critical part of making the design-build approach possible. For the SH 130 project, TxDOT's risk management approach for ROW and utilities costs was as follows:

Early Coordination with Utility Companies

The utility partnering process began early both to alert utilities to the project and to provide potential developers with the information they needed to submit a bid. All utility companies were invited to an informational meeting about the project and TxDOT established nonbinding memoranda of understanding (MOU) with about 70 percent of the utilities prior to the bid/contract activities. The MOUs served to alert the utilities that bidders would be contacting the utility and requesting information, and also that the private partner would be the primary point of contact. TxDOT believes the MOUs were an important step in establishing communication, and notes that they never had to refer back to the MOUs during subsequent work with utilities. Utility strip maps and a utility summary were provided to potential bidders. All bidders were instructed to verify the information provided by TxDOT and allowed access to utilities located on private property.

100 Percent Reimbursement of Utility Costs

TxDOT notes that the 100 percent reimbursement strategy, as was applied to the CTTS 2002 project, can be an effective way to expedite utility relocation. To be most effective, however, it must be tied to a specific project schedule, as well as to a requirement that utilities meet this schedule, as was provided in this case by the state legislature. TxDOT notes that they never had to apply their authority to take over the utility's assets. (They also note that the high-profile/high-visibility nature of this particular project was an important and perhaps somewhat unique factor in achieving timely action by utilities.)

In preparing their bids, potential developers were instructed to meet utility owner standards, pay for the costs of adjustments but not betterments, and to seek goals of first avoiding adjustments, or alternatively minimizing associated costs and delays. The project developer was responsible for drafting, negotiating, and executing all adjustment agreements, and for ensuring that adjustments were made, whether by the utility or by the developer. TxDOT played an important oversight role, approving all agreements and occasionally threatening to invoke their ability to move the utility's assets if the utility was reluctant to do so. TxDOT also worked to protect the interests of the utilities, acting as an arbitrator to ensure that they were given fair treatment and compensation by the developer.

Project Management and Coordination Structure

Given the multiple parties and stakeholders involved in undertaking, reviewing, and approving ROW actions, TxDOT realized that a streamlined management and coordination structure was needed in order to ensure efficient and timely decision-making. TxDOT's general engineering contractor oversight team was at the center of this management and coordination structure. Key elements of the structure included:

ROW Liaison to Coordinate Among Project Partners

Although the project developer was responsible for ROW acquisition, TxDOT's project oversight consultants as well as FHWA needed to review each proposed acquisition package to ensure that it met state and Federal requirements. The developer was initially uncomfortable with the idea of direct communication between TxDOT and the oversight consultant, and instead wanted to be the middleman. From TxDOT's viewpoint, however, this would have produced unacceptable delays and miscommunications. The solution was to appoint a consultant liaison on the project oversight team with appropriate qualifications.

The ROW liaison on the TxDOT consultant team was charged with overseeing the ROW coordination process. A true team structure was utilized, with subconsultant team members being integrated as opposed to having a specific scope and deliverable. TxDOT staff and consultants were all referred to as part of the Turnpike Team, and the liaison was authorized to bring in subconsultants on an as-needed basis. Responsibilities of the liaison included being highly familiar with the contract with the developer and developing a process for resolving disputes and promoting partnering. The liaison also was responsible for developing a checklist for each of the pertinent functions and obtaining signatures from responsible state and consultant personnel of their concurrence in the process.

Formal partnering meetings were held on a monthly basis. These meetings set goals and identified milestones and potential stumbling blocks. Survey forms were sent to employees at all levels to allow them to identify problems and make suggestions for improving the process. Management teams reviewed the survey results to identify problems and seek solutions. In order to avoid setbacks due to the loss of key personnel, TxDOT included a provision in the management consultant's contract for a $50,000 penalty if key staff left prior to the conclusion of the project.


Texas confirmed the importance of collocating staff in order to successfully complete design-build projects. For the CTTS project, the project oversight consultants were located directly across a parking lot from the TxDOT project office and FHWA officials were placed on-site. Having state staff, consultants, and FHWA staff located in close proximity was critical to making timely decisions on each ROW acquisition package and keeping the project moving without delay. The State estimates that $120 million was saved in staff and consultant travel time alone, as a result of the collocation.

Functional Area Flow Charts

To assist project managers and staff with keeping the project on schedule, TxDOT developed process flow charts and manuals for every process with strict turnaround schedules and tracking. The flow charts identify the various steps in each process and include references to Federal law and regulations, state laws, and guidance manuals. The flow chart includes a brief summary of the chronological actions required and approval actions. The charts are color coded and include hold points, which are areas that require review and approval before advancing to the next step.

To the extent possible, critical activities were scheduled in parallel and as early in the process as feasible. For example, title commitments were ordered during design phase and appraisers gathered preliminary data during this phase as well. The appraisal, offer letter, deed, survey, and Endangered Species Act clearance were approved together in one package. On a case-by-case basis, the developer was approved to make a payment before reimbursement by TxDOT.

Every action was structured with a time limit. For example, a "10-day turn-around" rule was established to ensure that each ROW acquisition package was approved within 10 days of submission by the developer. Similarly, administrative settlements were approved or rejected within 10 days from receipt. To avoid returning unacceptable items and commencing another 10-day turn-around period, a process of informal correspondence was developed so that items viewed as deficient or incomplete could be quickly returned to the responsible party, rather than being passed through a hierarchy. As a result, most approval actions were completed in two or three days.

Electronic Tracking System

A GIS-based electronic tracking database was established to track the status of ROW acquisition on the project. The database includes parcel numbers, owner names, easements, right-of-entries, special commissioner assignment, review status (e.g., date received, date approved), acquisition cost, and other information. Maps were used to track the progress of acquisition, with different status (e.g., negotiation, acquired) represented in different colors.

The database tracking system was crucial to keeping project tasks on schedule. The system tracked the status of individual actions (e.g. approval of acquisition offers for each parcel) and compared actual to scheduled status. For example, the system would issue automatic alerts when two days were left in the 10-day response period for an acquisition package. The database also provided summary reports such as the number of parcel acquisitions, condemnations, relocations and possession and use agreements, and the total cost of acquisitions and replacement housing payments.

Details of individual agreements were carefully tracked. As various required documents were presented to the property owner they were signed for so that the required documents could go into the completed file. For example, the owner signed for the appraisal and relocation package, offer letter, title report, parcel sketch, any curative plan, and relocation brochure. As the documents enter the state system they were entered on a checklist to assure that no function was overlooked. Separate checklists were developed for four different packages, including an acquisition package, relocation package, payment package, and eminent domain package. Once the checklist was complete, the final check-off was for the retirement file, indicating the completion of all active steps.

Decision-Making Authority and Conflict Resolution Procedures (Escalation Ladder)

Another key to efficient and timely decision-making is to allow decisions to be made at the lowest possible level. Those working at the operating level need full authority to make those decisions, while at the same time a procedure is required to address conflicts or differences of opinion that may arise. TxDOT found that one particularly effective tool is the "escalation ladder," which specifies the levels of personnel to which conflicts should be successively brought if they are not immediately resolved. This process requires each of the parties to develop a white paper in which they spell out the problem from their point of view and provide a series of possible solutions. In the process of developing the white paper most conflicts were easily resolved so that it was unnecessary to escalate the issue to a higher level.

Environmental Coordination and Mitigation

Coordination with the environmental process also was important to ensuring the timely delivery of ROW. One advantage of TxDOT's design-build process is that the developer can begin construction on some segments while ROW acquisition on other parcels is still being completed. Early environmental agreement is critical to the success of this approach. For the CTTP 2002 Project, a Record of Decision (ROD) and blanket agreements with the Army Corps of Engineers were put in place in 2001, before awarding the design-build contract, based on a schematic of the ROW requirements. The ROD was critical to allowing TxDOT to sell bonds to finance the project beginning in 2002.

TxDOT performed a Phase 1 assessment of each parcel as part of environmental review and documentation activities conducted prior to the bidding process, so that the agency could identify any potential problems such as contamination or endangered species. TxDOT also was proactive in seeking public input, holding numerous meetings with property owners and neighborhood residents.

The State has taken several actions to encourage acceptance of projects by environmental resource agencies and interest groups. For example, the State coordinated with Bat Conservation International (BCI) in the installation of three bat houses under SH 130 bridges to restore habitat for Mexican free-tailed bats. BCI pioneered the concept of bridges designed or retrofitted for bats to make up for the loss of natural habitat. A total of eight bat houses will be installed under SH 130 bridges. Another environmental problem involved limestone caves and limestone voids accompanied by the need for special avoidance of threatened or endangered blind spiders. The State provided training to bulldozer operators in an effort to avoid destruction of spider habitat. Additional ROW also was acquired in the area to prevent intrusion into the spider habitat.

Additional actions taken by TxDOT to address environmental concerns related to CTTS 2002 Project's right-of-way included direct acquisition in excess of 250 acres for wetlands mitigation, working with two cities to maintain an area as city park, and purchasing conservation easements.

Top of Page

4.4 Benefits

The benefits of TxDOT's design-build ROW acquisition and utility relocation/adjustment procedures are evident through the rapid pace at which projects have proceeded. TxDOT notes that the first 40-mile section of SH 130 is one year ahead of schedule and $400 million under budget, including $100 million under budget on ROW.

Neither ROW acquisition nor utility relocation has impeded the critical path on the CTTS projects. Four years after the first notice to proceed was issued, the projects are well on their way to completion. The SH 45/Loop 1 project had a 14-month acquisition schedule, during which all 259 parcels were made available for construction in timely manner. On the SH 130 project, the first survey was received in April 2003; 367of 427 total parcels were available for construction as of June 2006, and construction had in fact been commenced or even completed on many of these parcels. Utility adjustments also proceeded on schedule; for the SH 45/Loop 1 project, as of June 2006, 51 of 55 utility adjustments had been completed with no delays to construction.

Top of Page

4.5 Resources

Web Sites:


1 In retrospect, TxDOT observes that referring to the private partner as the "developer" created confusion especially in the ROW process because of the term's association with real estate developers. The agency plans to apply a different term in the future.

2 Eminent domain proceedings were required on about 20 to 30 percent of parcels for the CTTS 2002 Project.


4 On the CTTS 2002 Project condemnation delays never came close to exceeding the 300-day limit, but usually fell in the range of 90 to 120 days. TxDOT is considering shortening the 300-day limit in future agreements.

< Previous | Index | Next >

Updated: 10/20/2015
HEP Home Planning Environment Real Estate
Federal Highway Administration | 1200 New Jersey Avenue, SE | Washington, DC 20590 | 202-366-4000