Grant Administration: Section 9.3 Involuntary AcquisitionsInvoluntary transactions are those that do not meet the requirements previously described for voluntary transactions. Many of the basic provisions for involuntary acquisitions are similar to voluntary, but there are important differences in the requirements. As discussed above, even a “willing seller” may require that the involuntary acquisition process be used. This section addresses the requirements and process of involuntary acquisitions, which includes acquiring with or without eminent domain. Handbook 1378, Chapter 5, Paragraph 5-5
In accordance with the requirements of the URA, for involuntary transactions, the grantee must:
1. Determine Property and Ownership: The first step should include a review every to determine property acquisition needs and identify any properties to be obtained. The grantee should conduct a title search of properties and easements to be acquired for the project. The grantee should obtain either an attorney title opinion letter, or purchase title insurance. Grantees should require owners to transfer the property with clear title. Handbook 1378, Chapter 5, Paragraph 5.4 and 49 CFR 24.102.
2. Notify Owner: As soon as feasible, the grantee shall notify the owner in writing that the grantee may acquire the real property or easement using federal funds and the basic protections provided to the owner by law, which includes specific notice that the agency does not represent the rights of the property owner and that he/she may want to obtain legal counsel. This additional notice about securing legal counsel is necessary if the grantee anticipates the possibility that the acquisition will require use of New Hampshire’s eminent domain/condemnation process. All tenants in legal occupancy (including non-residential occupants are protected by the URA and are eligible for relocation benefits under the URA. (See several sections below regarding relocation for more information.) Handbook 1378, Chapter 5 Paragraph 5-4(A)(1)
The grantee should send either a “Notice to Owner” or a “Notice of Intent to Acquire” and the HUD brochure informing the owner about the process and his/her rights:
- The Notice to Owner should advise all occupants not to move. The Notice only informs the property owner of the grantee’s initial interest in acquiring their property, but it is not a commitment to provide relocation benefits at this point. See Attachment 9-3: Sample Notice to Owner
- Some grantees choose to send a Notice of Intent to Acquire instead of a Notice to Owner. A Notice of Intent to Acquire ( Attachment 9-4: Sample Notice of Intent to Acquire ) must contain all the information included in a Notice to Owner, but would also state that the agency does intend to acquire the property, rather than expressing a preliminary statement of interest. Grantees should exercise caution if they choose to send a “Notice of Intent to Acquire” rather than a “Notice to Owner.” The Notice of Intent triggers relocation eligibility for owner-occupants and tenants. The Notice should advise all occupants not to move until notification of relocation benefits is provided.
- “The grantee may assure compliance with all of the regulatory requirements of information that must be included in the notice by sending HUD’s brochure (HUD Form 1041- CPD) entitled, “When a Public Agency Acquires Your Property.” Refer to Attachment 9-5: “When a Public Agency Acquires Your Property” Brochure of this chapter or download it from the HUD website. The booklet explains the basic protections afforded the property owner by law, provides additional explanation of the acquisition process, and relocation benefits.
3. Determine Value: Determine the value of the property based on the appraised value (reviewed by a Review Appraiser) in compliance with the URA and invite the seller to accompany the appraiser. Additional explanation about appraisals and determining value is found in Section 9.7 Appraisals and Just Compensation later in this chapter.
4. Notify Owner of Just Compensation: Provide a written offer to the owner contains the just compensation and summary statement sent after an appraisal is complete and the agency has determined just compensation. This written offer must include an offer for the full amount of the just compensation. Once this amount has been determined, this written offer should be delivered promptly. A sample is provided as Attachment 9-6: Sample Statement of the Basis for the Determination of Just Compensation. A statement must be included that summarizes the basis for just compensation and should provide:
- The amount offered as just compensation, and
- A description and location of the property to be acquired, and
- Identification of the buildings, structures, equipment, and fixtures that are included in the offer.
Handbook 1378, Chapter 5, Paragraph 5-4 L(4)
5. Close the Sale or Condemnation or Decide Not To Acquire: The grantee must determine whether it can go forward and close the sale, move to condemnation, or decide not to acquire. The decision will be dependent on the seller’s willingness as well as project necessities. 49 CFR 24.102(j)
- Willing Seller: If negotiations are successful in an involuntary acquisition, a contract for sale must be prepared and executed, and transfer documents secured. Remember, the environmental review process must be completed before entering into a binding sales agreement. (See Chapter 5: Environmental Review)
- Condemnation: If seller is not willing to convey the property, the grantee must determine whether it will pursue condemnation through eminent domain powers. If taking the property through condemnation, the grantee must deposit the full amount of just compensation with the court. Additional details about condemnation and eminent domain are provided in Section 9.4 of this chapter.
- Decide Not to Acquire: If the grantee decides not to buy or condemn a property, notice must be provided to the owner as described below.
Notice of Intent Not to Acquire
If the grantee decides not to buy or condemn a property at any time after the Notice of Intent to Acquire or Notice to Owner has been sent to the property owner, the grantee must send written notification, “The Notice of Intent Not to Acquire” to the owner and any tenants occupying the property. This written notice must be sent within 10 days of the decision not to acquire. Sending this notice will assist in keeping all affected persons informed of the grantee’s actions. 49 CFR 24.5 and Attachment 9-7 Sample Notice to Not Acquire provides a sample Notice of Intent Not to Acquire. The grantee should document the reason(s) for deciding against acquiring the property.
Notices should be sent by certified or registered mail, return receipt requested, or hand delivered by agency staff. Grantees must document receipt of the notices by the owner or occupant. If the owner or occupant does not read or understand English, the grantee must provide translations and assistance. Each notice must give the name and telephone number of agency staff that may be contacted for further information.