Uniform Relocation Assistance and Real Property Acquisition for Federal and Federally-Assisted Programs, 590-638 [05-6]

Agencies

• Federal Highway Administration
• DEPARTMENT OF TRANSPORTATION

[Federal Register Volume 70, Number 2 (Tuesday, January 4, 2005)]
[Rules and Regulations]
[Pages 590-638]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 05-6]



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Part V





Department of Transportation





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Federal Highway Administration



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49 CFR Part 24



Uniform Relocation Assistance and Real Property Acquisition for Federal 
and Federally-Assisted Programs; Final Rule

Federal Register / Vol. 70, No. 2 / Tuesday, January 4, 2005 / Rules 
and Regulations

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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration

49 CFR Part 24

[FHWA Docket No. FHWA-2003-14747]
RIN 2125-AE97


Uniform Relocation Assistance and Real Property Acquisition for 
Federal and Federally-Assisted Programs

AGENCY: Federal Highway Administration (FHWA), DOT.

ACTION: Final rule.

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SUMMARY: The FHWA is revising the regulation that sets forth 
governmentwide requirements for implementing the Uniform Relocation 
Assistance and Real Property Acquisition Policies Act (Uniform Act). 
These changes will clarify present requirements, meet modern needs and 
improve the service to individuals and businesses affected by Federal 
or federally-assisted projects while at the same time reducing the 
burdens of government regulations. The regulation has not been fully 
reviewed or updated since it was issued in 1989. These amendments to 
the Uniform Act regulation will affect the land acquisition and 
displacement activities of 18 Federal Agencies including the new 
Department of Homeland Security.

DATES: Effective Date: February 3, 2005.

FOR FURTHER INFORMATION CONTACT: Mamie L. Smith, Office of Real Estate 
Services, HEPR, (202) 366-2529; Reginald K. Bessmer, Office of Real 
Estate Services, HEPR, (202) 366-2037; or JoAnne Robinson, Office of 
the Chief Counsel, HCC-30, (202) 366-1346, Federal Highway 
Administration, 400 Seventh Street, SW., Washington, DC 20590. Office 
hours are from 7:45 a.m. to 4:15 p.m., e.t., Monday through Friday, 
except Federal holidays.

SUPPLEMENTARY INFORMATION: 

Electronic Access

    An electronic copy of this document may be downloaded by using a 
modem and suitable communications software from the Government Printing 
Office's Electronic Bulletin Board Service at (202) 512-1661. Internet 
users may also reach the Federal Register's home page at: https://
www.archives.gov and the Government Printing Office's database at: 
https://www.gpoaccess.gov/nara/.

Background

    Title 49, CFR, part 24 implements the Uniform Relocation Assistance 
and Real Property Acquisition Policies Act of 1970, as amended, 42 
U.S.C. 4601 et seq., (the Uniform Act). The Uniform Act applies to all 
acquisitions of real property or displacements of persons resulting 
from Federal or federally-assisted programs or projects and affects 18 
Federal Agencies. This regulation has not been comprehensively revised 
or updated since its initial publication in 1989.
    The FHWA, as the lead Federal Agency, hosted an all-Agency meeting 
in 2001 to begin discussions about a comprehensive review of this 
regulation because of numerous requests from various Agencies to update 
49 CFR Part 24. The FHWA worked with the 18 other Federal Agencies to 
form a Federal Interagency Task Force to explore the need to revise 
this regulation. The FHWA then hosted five nationwide public listening 
sessions to gather public input into the need for regulatory reform.
    After receiving public input, working with the Interagency Task 
Force and incorporating recommendations from all 18 Federal Agencies, 
the FHWA published a notice of proposed rulemaking (NPRM) on December 
17, 2003 (68 FR 70342). The NPRM proposed revisions to the Uniform Act 
regulation that would clarify present requirements, meet modern needs 
and improve the service to the individuals and businesses affected by 
Federal or federally-assisted projects while at the same time reducing 
the burdens of government regulations. An extensive history of the 
Uniform Act's implementation, and a comprehensive narrative outlining 
the efforts to update this regulation is discussed in the preamble to 
the NPRM in great detail.

Public Meetings

    During the comment period to the NPRM, the FHWA hosted three 
additional public meetings (in Washington, DC; Atlanta, GA; and 
Lakewood, CO) to discuss the proposed changes to the regulation as 
outlined in the NPRM. The meetings were held to assure that every 
opportunity was offered to encourage additional public and stakeholder 
comment on the proposed changes. A total of 60 individuals and 
organizations attended the three public meetings. Also, during the 
comment period, the FHWA posted on its Web site a pre-addressed comment 
form for easy access and mailing to the docket.

Discussion of Comments Received to the Notice of Proposed Rulemaking 
(NPRM)

    In response to the NPRM published on December 17, 2003, the FHWA 
received 775 comments to the docket. The 775 comments were received 
from 80 individual commenters. The commenters included a variety of 
groups and organizations, such as local public Agencies, State Highway 
Administrations, private real estate and environmental consulting firms 
and interested individuals.
    Of the 775 docket comments, 62 were positive and supportive of the 
proposed changes and 58 were on subjects where no change had been 
proposed. Thirty comments were programmatic questions and will be 
answered through a follow-up question and answer memorandum, and 26 
comments requested increases in statutory limits that cannot be 
addressed in the regulations. On March 3, 2004, all 18 Federal Agencies 
were invited and encouraged to send representatives to an Interagency 
Federal Task Force (IFTF) meeting to review and respond to the 775 
comments. Of the 18 Federal Agencies, 12 responded by sending one or 
more representatives. Following the initial meeting, four additional 
IFTF meetings were held and all 775 comments were categorized into 
subparts discussed individually, and evaluated. The FHWA, as Lead 
Agency, would like to thank the Department of Housing and Urban 
Development (HUD) who worked closely with FHWA to organize and share in 
hosting the work group meetings to assure that all comments were 
carefully considered.

Section-by-Section Discussion Changes

Subpart A--General

Section 24.1(b)
    One commenter indicated that Sec.  24.1(b) should include an anti-
discrimination purpose.
    A number of Federal statutes (notably the Civil Rights Acts of 1964 
and 1968) and Executive Orders apply to Agencies carrying out Federal 
or federally-assisted programs, and prohibit discrimination on the 
basis of race, color, sex, age, religion, national origin or 
disability. These legal authorities are self-executing and do not 
require specific mention in a rule implementing the Uniform Act to find 
effect. Any explicit listing of such provisions in this regulation runs 
the risk of inadvertent omission, creating the implication that any 
legal authority not referenced is somehow inapplicable.
Section 24.2 Definitions and Acronyms
    Two commenters suggested various formatting changes. One suggested 
that clarity and readability would be improved by stating each defined 
term only once, rather than entry as a heading, followed by repeating 
the term

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in the definition. Another suggested that we adopt simplified 
formatting.
    We appreciate these comments, however, we will keep the same format 
in this final rule.
Section 24.2(a) Personal Property
    One commenter requested that we add a definition of personal 
property.
    We considered the request, however, after surveying the varying 
State laws that define personal property, we have determined that it 
would not be feasible to provide a single definition that would fit 
within all State laws. Therefore, whether an item is personal property 
or real property will continue to be left to State law.
Section 24.2(a)(5) Citizen
    One commenter requested that we define or clarify the term 
``noncitizen national'' used in the definition of ``citizen'' in Sec.  
24.2(a)(5).
    The term ``noncitizen national'' was added to the definition of 
citizen in 1999 (64 FR 7130). The term includes persons from certain 
United States possessions, such as American Samoa, who are considered 
citizens for purpose of this part. Accordingly, no change in the final 
rule is necessary.
Section 24.2(a)(6)(ii) Comparable Replacement Dwelling
    Ten comments were made on the proposal to remove the phrase ``style 
of living'' from the definition of comparable replacement dwelling. The 
majority of the comments were in favor of removing the phrase; however, 
two commenters were concerned that the displaced person's rights would 
be diminished if the phrase is deleted.
    We carefully considered removing ``style of living'' from the 
definition of comparability, and we determined that the displaced 
person would not suffer any erosion of protections provided by existing 
comparability requirements. The phrase ``style of living'' has 
sometimes been misused and has proven to be confusing.
    Occasionally, the phrase has been used out of context and 
interpreted to require identical unique features found in acquired 
dwellings. In such cases, the standard for replacement housing has been 
raised to a level above ``comparable.'' This interpretation can make it 
nearly impossible to find appropriate replacement housing and could 
result in replacement housing payments greater than those intended by 
the Congress.
    A more complete explanation can be found in the preamble to the 
NPRM (68 FR 70344). The Congress recognized that strict and absolute 
adherence to an exhaustive, detailed, feature-by-feature comparison can 
result in rigidities. We believe other criteria currently under the 
definition of comparability will adequately cover the factors covered 
by ``style of living'' and, therefore, have not included this phrase in 
the final rule.
Section 24.2(a)(6)(viii) Deductions from Rent
    One commenter objected to the proposed addition of language in 
Sec.  24.2(a)(6)(viii) that would have allowed rent owed to an Agency 
to be taken into account when determining whether a comparable 
replacement dwelling is within a displaced person's financial means. 
The comment noted that State landlord/tenant laws normally govern 
disputes over rent, and that Sec.  24.2(a)(6)(viii) should not, in 
effect, supercede the tenant protections contained in such laws in 
determining a displaced person's financial means.
    We agree with this comment, and accordingly have not adopted the 
language that would have considered any rent owed the Agency in 
determining financial means.
Section 24.2(a)(6)(viii) Financial Means
    The Uniform Act requires that comparable replacement dwellings must 
be ``within the financial means'' of a displaced person. This term is 
defined further within the definition of comparable replacement 
dwelling. The NPRM proposed simplifying the definition of financial 
means by consolidating it from three paragraphs to a single paragraph. 
No change in meaning was intended.
    We received 12 comments on this proposed change. The commenters 
expressed two major concerns. First, several comments indicated that 
consolidating the separate paragraphs relating to owners and tenants 
was confusing and might, in some cases, result in changes to 
replacement housing payments.
    After further consideration, we believe these comments are correct, 
and, accordingly, have not adopted the proposed consolidation. (We 
have, however, deleted some redundant language relating to welfare 
assistance programs that designate amounts for shelter and utilities, 
since this is now addressed in Sec.  24.402(b)(2)(iii).)
    Secondly, because of other related changes in the NPRM, several 
commenters stated that the proposal would no longer adequately address 
the benefits to be provided to a person who is not eligible to receive 
replacement-housing payments because of a failure to meet the necessary 
length of occupancy requirements. Such persons are still entitled to 
receive comparable replacement housing within their financial means.
    Besides proposing to simplify the description of financial means, 
the NPRM also proposed changing the way the rental replacement housing 
payment would be computed by revising the description of ``base monthly 
rent'' in Sec.  24.402(b)(2), and removing the reference to 30 percent 
of income in Sec.  24.404(c)(3) (which describes the eligibility of 
persons that fail to meet the length of occupancy requirements). The 
later two changes have been adopted, as discussed further in this 
preamble.
    We agree that the proposed changes left it unclear as to the 
benefits that were to be provided to persons who failed to meet length 
of occupancy requirements. Accordingly, we have retained a paragraph 
(Sec.  24.2(a)(6)(viii)(C)), within the description of financial means, 
that addresses those persons, described in Sec.  24.404(c)(3), who do 
not meet length of occupancy requirements. It is similar to the current 
provision, and provides that the payment to such persons shall be the 
amount, if any, by which the rent at the replacement dwelling exceeds 
the base monthly rent described in Sec.  24.402(b)(2), over a period of 
42 months.
Section 24.2(a)(6)(ix) Subsidized Housing
    Several commenters took issue with the proposed change to apply a 
government housing subsidy program's unit size restrictions when 
providing comparable replacement housing.
    It appears that several of the commenters did not understand how 
the government subsidy programs work. The choice of a replacement 
dwelling is always left to a displaced person, but a displaced tenant's 
eligibility for relocation assistance is premised upon the selection of 
a decent, safe and sanitary ``comparable'' dwelling. The existing 
regulations have long provided that a comparable dwelling, in the case 
of a person displaced from housing receiving certain project-based or 
voucher based subsidies, is another dwelling unit receiving the same or 
a similar subsidy.
    In such cases the HUD program requirements for subsidized housing, 
may limit the unit size of available subsidized housing by applying a 
determination as to a family's current needs, even though the 
displacement dwelling may have been larger. This final rule 
acknowledges these requirements, and provides in Sec.  24.2(a)(6)(ix) 
that the requirements of government housing assistance

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programs, relating to the size of the dwelling unit that may be 
provided, apply when such housing is used as a comparable replacement 
dwelling.
    A person displaced from a subsidized unit may elect to relocate to 
housing available on the private market without subsidy, but the 
available relocation payment will be limited by a computation using a 
comparable subsidized unit. In most cases, the long-term housing 
subsidy available to someone displaced from a subsidized unit, will be 
more advantageous than a relocation payment based on the selection of a 
dwelling available on the private market. The relocation payment for a 
dwelling on the private market is limited to a rental differential for 
a 42-month period by the Uniform Act.
Section 24.2(a)(8)(ii) Decent, Safe and Sanitary
    Twenty comments were received concerning the inclusion of standards 
relating to deteriorated paint or lead-based paint in the definition of 
``decent, safe, and sanitary dwelling'' in Sec.  24.2(a)(8). While all 
of these comments were favorable, there is no legal authority for 
mandating these standards in connection with the referral to comparable 
private market replacement housing under the Uniform Act. Accordingly, 
this language has been removed from the list of the mandatory elements 
of ``decent, safe, and sanitary'' replacement housing appearing in this 
regulation. Instead, we have included in appendix A a suggestion that 
such standards may be required by local housing and occupancy codes, 
and may, in any event be highly desirable in protecting the health and 
safety of displaced persons and their families.
Section 24.2(a)(8)(iv) Housing and Occupancy Codes
    Of the seven comments received on Sec.  24.2(a)(8)(iv) having to do 
with using local housing and occupancy codes to determine whether the 
unit is decent, safe and sanitary, most were concerned with determining 
the number of rooms and living space per individual. One commenter 
requested that the FHWA set a minimum number of square feet in a 
bedroom for each occupant as well as set an age standard for bedrooms 
occupied by siblings of opposite gender.
    The protection of the public health, safety and welfare is an 
essential power of a sovereign government specifically reserved to the 
States. Accordingly, this regulation references local housing and 
occupancy codes as the primary source for defining ``standard'' 
housing. (In the case of certain federally subsidized replacement 
housing, federally-issued ``housing quality standards'' may be employed 
where such codes do not exist or are not applied to such housing.)
    As was noted in the preamble to the NPRM, the existing regulatory 
policy on this subject would apply only in the absence of local codes. 
This has been clarified in Sec.  24.2(a)(8)(iv). Questions of whether 
contrary or more restrictive housing and occupancy standards than those 
found in a local code, imposed by State law, must be deemed to override 
these local standards must be determined as a matter of State law by 
courts of competent jurisdiction or by the State's Attorney General, 
and cannot be addressed in these regulations.
Section 24.2(a)(8)(vi) Egress to Safe Open Space
    We received three comments concerning the removal of the 
requirement that replacement housing units have two means of egress 
when replacement units are on the second story or above and have direct 
access to a common corridor. One was in favor of the change, a second 
was uncertain as to the purpose of the requirement and another was 
against the change for fear of the safety risks to the displaced 
person.
    This is an area best handled through local fire and building codes 
and does not require Federal guidelines to assure the safety of 
displaced persons. There was overwhelming support for removing the 
requirement from our five national Public Listening Sessions that we 
held leading up to preparations of the NPRM. Therefore, no change was 
made to the language proposed in the NPRM.
Section 24.2(a)(8)(vii) Disability
    Thirteen commenters requested that the definitions of Comparable 
Replacement Dwelling and Decent Safe and Sanitary Dwelling (and the 
corresponding provisions of appendix A) go into more detail regarding 
the needs of persons with disabilities, as well as a variety of 
disabilities.
    Because the needs of persons who are disabled are addressed by 
other Federal or local statutory and regulatory requirements, which may 
or may not apply to any individual project which triggers the Uniform 
Act, we believe it is unnecessary to elaborate further in this rule 
except as noted in appendix A. The final rule addresses the need to 
accommodate the displaced person's needs in terms of unit size, 
location, access to services and amenities, reasonable ingress, egress 
or use of a replacement unit, and therefore, we do not believe 
additional detail is necessary.
    We agree that there is a need to revise some of the language in 
appendix A, Sec.  24.2(a)(8)(vii) to address the physical attributes of 
replacement housing for persons with physical disabilities beyond those 
dependent on a wheelchair. Therefore, we have broadened the language in 
the final rule to include persons with a physical impairment that 
substantially limits one or more of the major life activities of such 
individual. We have not addressed the needs of other nonphysical 
disabilities (such as mental impairment) in this rule since it is 
unclear what unit attributes would need to be addressed for this class 
of persons and any needs of such persons would be more appropriately 
addressed by other statutory and regulatory requirements.
Section 24.2(a)(9)(ii)(D) Temporary Relocation
    In 1987, the Uniform Act was amended to cover displacement from 
Federal and federally-assisted programs or projects as a direct result 
of rehabilitation. To counter the disincentive this might create for a 
tenant temporarily displaced from a residence while that residence is 
being rehabilitated, we considered such a person not to be displaced, 
if, and only if, certain stringent protections are applied. These 
included covering moving expenses to and from the temporary location, 
payment of increased housing costs during the period of relocation, the 
guarantee of a return to the same unit, or to another suitable unit in 
the same building or complex, and a limitation on a rental increase at 
the rehabilitated replacement unit.
    We believe that this interpretation of the law, to create an 
exception to its general applicability, must be limited and strictly 
applied, in order to meet the intent of Congress. Accordingly, the NPRM 
proposed that displacement for a period exceeding 12 months must 
ordinarily be considered significant enough to fall within the general 
rule pertaining to displacement as a direct result of rehabilitation, 
and not to come within the limited exception to the definition of 
``displaced person'' which the law establishes. Therefore, the language 
proposed in the NPRM will not change.
    We received eleven comments on the proposed language further 
describing temporary relocation in Sec.  24.2(a)(9)(ii)(D) of appendix 
A. Two comments supported this change. However, we are seriously 
concerned that several of the commenters appear to believe that a 
person who is displaced by a project that triggers the Uniform

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Act can somehow be exempted from full relocation assistance benefits as 
a displaced person if the Agency terms his/her relocation 
``temporary'', regardless of the required length of time or hardship 
caused to the displaced person. We are further concerned that some 
commenters seem to consider the cost to their project more important 
than the protection provided by the Uniform Act. This may indicate that 
appropriate project and relocation planning is not taking place. It is 
for this reason that additional clarity concerning temporary relocation 
has been added to the rule.
    Several commenters referenced the HUD policies on temporary 
relocation. HUD has indicated for years that it has always restricted 
``temporary relocation'' to situations where the Uniform Act trigger 
was rehabilitation. In such cases, a tenant was guaranteed the right to 
return to a unit in the project prior to moving from the displacement 
dwelling. In recent years, HUD has permitted grantees to consider up to 
one year as acceptable temporary relocation duration, but again, only 
where the Uniform Act trigger is rehabilitation. However, HUD reports 
that some HUD grantees may have abused this policy and stretched it to 
apply in situations which are clearly beyond the scope of 
``temporary,'' where an entire building or group of buildings is being 
demolished and will be replaced with fewer units. In this situation, 
displaced persons cannot be guaranteed a unit in the new building(s) at 
the time they are required to move from the displacement unit for 
reasons including: there may be insufficient units rebuilt; former 
tenant may not meet newly adopted return criteria, and, return to the 
project may not be for years simply because of the massive demolition 
and rebuilding that must take place. While many of these sorts of 
projects purport to allow displaced tenants to return, the reality is 
that few can. We do not support advising tenants that they are only 
being temporarily relocated, and are not displaced, when their actual 
return to a unit in the project is in doubt, and/or may not be for an 
extended period of time. Further, permanently displacing a person and 
providing them with full relocation assistance under the Uniform Act 
should not automatically negate their ability to apply for or return to 
the site of the HUD funded project that caused their displacement. Many 
HUD projects give preference to former tenants who want to return.
    The rule, now requires that any residential tenant who has been 
temporarily relocated for a period beyond one year must be contacted by 
the Agency and offered all permanent relocation assistance.
    One commenter suggested imposing the same one-year requirement upon 
owner occupants and nonresidential occupants. The final rule adopts 
language in the proposed rule that provides that ``temporary relocation 
should not extend beyond one year before the person is returned to his 
or her previous unit or location.'' We believe this establishes a sound 
policy that should be followed in most cases. We recognize, however, 
that in some situations, involving temporary relocations caused by 
disasters or public health emergencies, Agencies may not be able to 
provide permanent relocation benefits to such occupants within one 
year, if ever, because of statutory or programmatic limitations.
    We also agree with the commenter who suggested that a temporary 
move of personal property is not intended to be covered by the one-year 
limitation on temporary moves.
    We expanded the language in appendix A, Sec.  24.2(a)(9)(ii)(D), to 
cover ``rehabilitation or demolition'' as suggested by one of the 
commenters. As noted, we are not changing the language relative to 
``one year'' as we believe this is a reasonable time for any tenant to 
be in temporary housing (one year is a fairly common initial lease 
period across the United States). After the one-year period, the final 
rule requires that a residential tenant be offered permanent relocation 
assistance. Such tenants may be given the opportunity to choose to 
continue to remain temporarily relocated for an agreed to period (based 
on new information about when they can return to the displacement 
unit), choose to permanently relocate to the unit which has been their 
temporary unit, and/or choose to permanently relocate elsewhere with 
Uniform Act assistance. It is expected that temporary relocations will 
be rare, and, for HUD funded projects, clearly planned for in the 
development of the project, and used only where a tenant is guaranteed 
a replacement unit in the project or unit from which they were 
displaced.
Section 24.2(a)(9)(ii)(M) American Dream Downpayment Initiative (ADDI)
    A new paragraph, Sec.  24.2(a)(9)(ii)(M), has been added to the 
list of ``persons not displaced'' to reflect a provision, added by 
Section 102 of the American Dream Downpayment Act (Pub. L. 108-186; 
codified at 42 U.S.C. 12821) provides that the Uniform Act does not 
apply to the American Dream Downpayment Initiative (ADDI), a 
downpayment assistance program administered by the Department of 
Housing and Urban Development.
Section 24.2(a)(11) Dwelling Site
    We received nine comments in response to the proposed definition of 
dwelling site. Most agreed that it was needed. Six commenters asked 
that additional information be provided on what constitutes a dwelling 
site.
    We agree and are revising the definition for clarity. We have 
provided specific examples in appendix A as to when its use is 
appropriate.
Section 24.2(a)(12) Eviction For Cause
    We received nine comments on the proposal to simplify the eviction 
for cause provisions in Sec.  24.206 by moving some of them to a new 
definition in Sec.  24.2(a)(12). Several commenters found this proposal 
to be confusing, and believed that it resulted in substantive changes 
to the eviction for cause provisions. This was not our intent, and 
accordingly we have not adopted the changes to Sec.  24.206 and the new 
definition that were proposed in the NPRM. We have retained the current 
regulatory language in Sec.  24.206.
    One commenter objected to a clarifying sentence proposed in Sec.  
24.206 of appendix A, which simply stated that an eviction related to 
project development does not affect entitlement to relocation benefits. 
The commenter felt that this conflicted with the current eviction for 
cause provisions. However, we have retained the language in appendix A 
to make it clear that evictions related to scheduled project 
development, to gain possession of property, do not affect relocation 
eligibility. As noted in Sec.  24.206, a person who is a lawful 
occupant on the date of initiation of negotiations is presumed to be 
entitled to relocation benefits, and can only be denied relocation 
benefits if the person had received an eviction notice prior to the 
initiation of negotiations, or is evicted thereafter ``for serious or 
repeated violations of material terms of the lease or occupancy 
agreement.'' We do not consider an eviction resulting from a failure to 
move or relocate when asked to do so, or to cooperate in the relocation 
process for a federally funded project, to be based on a ``serious or 
repeated violation of material terms'' of a lease or agreement.
    If an eviction is ``for the project'' (resulting from a failure to 
move or relocate when asked to do so, or to cooperate in the relocation 
process) such an eviction cannot be considered as ``serious or repeated 
violation of material terms'' of a lease or agreement unless, prior to 
executing the lease, the

[[Page 594]]

tenant was notified in writing of the proposed project and its possible 
impact on him/her and that he/she would not be eligible for relocation 
payments. While public housing leases may have a clause requiring that 
a tenant move or cooperate in a move, these provisions are included for 
the purpose of adjusting unit size as necessary for changes in family 
composition, and do not negate the tenant's eligibility for relocation 
benefits caused by a federally-assisted project which triggers the 
Uniform Act.
Section 24.2(a)(13) Financial Assistance/Lease Payments
    One commenter objected to the proposed addition of the term ``lease 
payment'' in the definition of ``Federal financial assistance'' in 
Sec.  24.2(a)(13). The commenter noted that this term is not included 
in the statutory definition of ``Federal financial assistance'' and its 
addition could have major consequences that were not mentioned or 
considered in the NPRM. We agree and have deleted the term.
Section 24.2(a)(14) Household Income
    We received 16 comments concerning the new definition of household 
income. Most of the comments were positive and in support of the new 
definition. However, four commenters requested that we go further in 
our definition of household income by adding additional examples. 
Several of the same commenters also requested that the examples given 
in appendix A be moved to the definition in Sec.  24.2(a)(14).
    Because the sources of household income constantly change and vary 
by household, we will not produce a more definitive list of income 
sources. Based on the experience of other Federal Agencies that use 
definitions of income, such definitions can never be totally 
comprehensive or timely, and could render the regulations outdated 
within a short period of time. Displacing Agencies need to determine 
income for each individual or family based on whatever financial 
resources are available (earned, unearned, benefits, etc.). When a 
question arises as to whether something should be considered as income, 
the Federal Agency administering the program should be contacted for 
its assessment. To further assist in the determination of income 
exclusions, the FHWA has provided a Web site, (see appendix A, Sec.  
24.2(a)(14)), of income exclusions that are federally mandated. The 
income exclusions change periodically based on congressional action and 
the FHWA will update the Web site as necessary.
    We are opposed to moving the examples in appendix A to the 
definition. The examples are to support the definition and should not 
be a part of the definition. Therefore, they will remain in appendix A.
    One commenter suggested that we change the language in the 
definition to assure that income claimed is actually received. It is 
our position that the responsibility for verifying income should be 
left to the acquiring Agency.
    One commenter raised the concern that we have not made provisions 
for changes that may occur in the income stream throughout a 12 month 
period. We suggest that if the income changes before the relocation 
offer is made, that an adjustment be made based upon verification of 
the change in income. Otherwise, we suggest using the income stream in 
existence at the time of the relocation offer. The amount of a 
displaced tenant's replacement housing payment should not be adjusted 
if the tenant's income later changes. The Uniform Act envisions a 
rental assistance payment that is determined once, and which is not 
affected by subsequent events. Replacement Housing Payments under the 
Uniform Act are not to be confused with rental or homeownership subsidy 
programs. There is no statutory provision for adjusting relocation 
claims or payments based on changes in income after the eligibility 
determination has been made.
Section 24.2(a)(15) Initiation of Negotiations
    The NPRM proposed adding paragraph (iv) to the definition of 
Initiation of Negotiations (ION) in Sec.  24.2(a)(15), to address ION 
for acquisitions that occur amicably, without recourse to the power of 
eminent domain. The intent was to avoid establishing a tenant's 
relocation eligibility before there was any certainty that the property 
would actually be acquired.
    We received 21 comments on this change. A major concern was that 
delaying tenant eligibility in these cases, until the owner accepts an 
offer to purchase, might have an adverse effect on such tenants by, for 
example, their being forced to move as part of the pre-acquisition 
negotiations, as well as otherwise increasing uncertainty in program 
management.
    In response, we have revised paragraph (iv) in the final rule to 
provide that ION means the actions described in paragraphs (i) and 
(ii), for routine Agency acquisitions, except that, in the case of 
amicable acquisitions covered in paragraph (iv), the ION does not 
become effective for purposes of establishing relocation eligibility 
until there is a written agreement between the Agency and the owner to 
purchase the property. This would establish the potential relocation 
entitlement of tenants at the time negotiations begin, but would not 
provide relocation benefits in the event no agreement was reached to 
acquire the property. Such tenants should be fully informed of their 
potential eligibility.
    In response to a comment we also changed the reference to 
``acceptance of the Agency's offer to purchase the real property'' to 
``written agreement between the Agency and the owner to purchase the 
real property,'' for greater clarity and specificity.
    At the request of the Environmental Protection Agency (EPA), the 
language in Sec.  24.2(a)(15)(iii), concerning the initiation of 
negotiations on superfund related projects, has been updated and 
clarified, primarily to delete references to a ``Federal or federally-
coordinated health advisory.'' Such health advisories are general in 
nature and are rarely related to determinations that relocation is 
necessary. Rather, the action that triggers relocation is a fact-based 
determination by the EPA, or the Federal Agency conducting an action 
under the Comprehensive Environmental Response Compensation and 
Liability Act of 1980 (Pub. L. 96-510 or Superfund) (CERCLA), that 
temporary relocation or acquisition is necessary because there is a 
threat to an individual's health or safety. Typically, on such 
projects, temporary relocation occurs first, and then, if warranted by 
the circumstances, it may be followed by permanent relocation. Similar 
clarifications have also been made in appendix A, Sec.  
24.2(a)(15)(iii).
Section 24.2(a)(17) Mobile/Manufactured Homes
    A new definition for the term ``mobile home'' has been added to 
this section. Six comments were received on this proposed addition. 
Five commenters agreed that the definition was needed, and three 
comments proposed changes to the definition to differentiate between 
mobile homes, manufactured housing and recreational vehicles. The term 
``mobile home'' includes both manufactured homes and recreational 
vehicles used as residences. Appendix A explains that ``mobile homes'' 
and ``manufactured homes'' are recognized as synonymous by HUD for that 
Agency's programs, and for purposes of this regulation will be 
considered the same. Appendix A also includes further requirements that 
recreational vehicles must meet in order to qualify as replacement 
housing in appendix A.

[[Page 595]]

(Subpart F continues to include an explanation of the different methods 
of computing relocation assistance when a mobile home has been 
determined to be personal property, and when it is determined to be 
real property.)
Section 24.2(a)(22) Program or Project
    One commenter requested a more detailed definition of the term 
``project.'' Federal Agency experience over the years has amply 
demonstrated that it is not feasible to devise a common definition of 
``project'' which could apply to all Federal and federally-assisted 
programs subject to the Uniform Act. Widely varying legislative and 
administrative histories of the various programs currently covered, as 
well as (in some cases) decades of practice, have led to the conclusion 
that the broad definition of ``project'' should remain unchanged. To 
alter the present definition might prove highly disruptive to the 
administration of many programs administered by Federal Agencies.
    However, Federal Agencies should always interpret the term 
``project'' in a way that will ensure that persons who are forced to 
move as a result of Federal or federally-assisted activities are 
covered by the Uniform Act.
Section 24.2(a)(30) Utility Costs
    Two commenters suggested further clarifying the expenses that are 
included in the definition of utility costs. In response, we have 
replaced the reference to heat and light with a reference to 
electricity, gas, and other heating and cooking fuels.
Section 24.4(a)(3) Assurances
    We received two comments opposing the changes proposed in the NPRM 
to Sec.  24.4(a)(3) of the NPRM. One commenter was concerned that the 
proposed language would exempt Agencies undertaking arm's length 
acquisitions from required compliance with the Uniform Act. Similarly, 
a second commenter brought to our attention that the proposed language 
may nullify the conditions set forth in CFR 49 Part 24.101(b)(1). We 
did not intend to undermine the requirements of other sections of the 
regulations, therefore, after careful review, we agree that the 
proposed language may be perceived to conflict with the provisions in 
Sec.  24.101(b)(1), and have not adopted the proposal in the final 
rule.
Section 24. 8 Compliance with Other Laws and Regulations
    Several commenters suggested the inclusion of additional laws and 
regulations within Sec.  24.8.
    The existing regulatory language requires the implementation of 
this part to be in compliance with other applicable Federal laws and 
implementing regulations, including, but not limited to the laws and 
regulations cited. The list is merely a representative sample of some 
significant laws and regulations and is by no means intended to be a 
comprehensive listing of all applicable laws and regulations. An 
applicable law or regulation is not required to be cited in this 
section to be applicable to this part. Therefore, no change is 
considered necessary. However, for clarity, we have corrected two 
existing laws. We have added, ``as amended'' after the reference to the 
Robert T. Stafford Disaster Relief and Emergency Assistance Act in 
Sec.  24.8(n); and, we have added a reference to EO 12892, Leadership 
and Coordination of Fair Housing in Federal Programs: Affirmatively 
Furthering Fair Housing (January 17, 1994), Sec.  24.8(o). EO 12892 
replaced EO 12259.
Section 24.9 Records and Reports
    We received twelve comments on the proposed revisions to Sec.  
24.9(c), which proposed to require each Federal Agency to submit an 
annual report summarizing its relocation and acquisition activities. 
One commenter supported this change and one sought further 
clarification. The remaining ten commenters opposed this change, 
primarily on the grounds that it would impose significant 
administrative burdens and would have little apparent value.
    It was not our intent to increase administrative burdens. As was 
noted in the NPRM, our primary interest was in obtaining more accurate 
information, to more effectively monitor implementation of the Uniform 
Act. However, due to the negative comments received, we have decided 
not to adopt the proposed change.
    Further, since no comments objected to the proposed simplification 
of the report form in appendix B, we have adopted the proposed form and 
the instructions for its use. The simplification of the form may lead 
to greater use by Agencies.
    Outside the context of Part 24, the lead Agency will explore the 
possibility of obtaining such additional acquisition and displacement 
information from other Federal Agencies as may result from routine 
Agency operations and oversight.

Subpart B--Real Property Acquisition

    We received a comment that the NPRM proposed change to replace the 
term ``fair market value'' with ``market value'' throughout Subpart B 
to better reflect current appraisal terminology was neither minor nor 
reflected universally accepted eminent domain terminology throughout 
the country.
    Upon further examination, we determined that ``fair market value'' 
terminology is consistent with Uniform Act language and it appears that 
Federal courts see no difference in the terms ``fair market value'' and 
``market value.'' Accordingly, we have retained the terminology ``fair 
market value'' throughout the subpart, except for Sec.  24.101(b)(1) 
through (5), where eminent domain is not applicable. But we have added 
language to appendix A noting that for Federal eminent domain purposes, 
the two terms may be synonymous.
Section 24.101(a) Direct Federal Program or Project
    Federal Agencies advised us voluntary transaction provisions were 
being used to a significant extent and suggested that these exceptions 
should no longer apply to acquisitions by Federal Agencies. Their 
proposal to eliminate this provision for Federal agencies direct 
purchases is consistent with section 305(b)(2) (42 U.S.C. 4655(b)(2)) 
of the Uniform Act, which allows these exceptions for recipients of 
Federal financial assistance, but provides no such exceptions for 
Federal Agencies themselves. We included the Agencies' suggested 
revision in the NPRM.
    Formerly, the two major exceptions to real property acquisition 
requirements in Subpart B were voluntary transactions and acquisitions 
in which the Agency does not have the power of eminent domain. We 
restructured this section to clarify the application of the real 
property acquisition requirements set forth in this subpart, and to 
revise the exceptions to those requirements.
    We have adopted the Agencies' proposed change in the final rule, 
but the exceptions for federally-assisted projects and programs remains 
in Sec.  24.101(b).
    One commenter objected to excluding direct Federal acquisitions 
from voluntary transaction procedures because the commenter believed 
that where an Agency acquired a property that was listed for sale, it 
would create a windfall for that property owner by allowing the owner 
to receive Uniform Act benefits.
    However, as noted elsewhere in this rule (See Sec.  
24.2(a)(9)(ii)(E) and (H) and 24.101(a)(2)), if a property owner 
voluntarily conveys his or her property, without recourse to the power 
of eminent domain, he or she would

[[Page 596]]

continue to be ineligible for relocation benefits.
    Based on a comment we added the word ``direct'' to the title of 
Sec.  24.101(a) for clarity. We also added language to appendix A to 
further clarify the applicability of this paragraph.
    We updated language in the rule and in appendix A to reflect the 
Rural Utilities Service, successor Agency to the Rural Electrification 
Administration.
    We added Sec.  24.101(a)(2) to make it clear that, despite the rule 
change to make all direct Federal acquisitions undertaken without 
recourse to the power of eminent domain subject to the provisions of 
Subpart B, the owners of property acquired voluntarily by direct 
Federal acquisition, continue to be ineligible for relocation 
assistance benefits.
Section 24.101(c) Less-Than-Full-Fee Interest in Real Property
    There was a comment suggesting we move the language from appendix 
A, discussing Agencies applying these regulations to any less-than-
full-fee acquisition, into the body of the rule itself for greater 
clarity.
    We agree, and the final rule reflects this change.
Section 24.102 Basic Acquisition Policies
    We received a comment stating that Sec.  24.102 relates only to 
acquisitions under the threat of eminent domain, and should be retitled 
to reflect that.
    We respectfully disagree with this comment and note the exceptions 
to the applicability of Subpart B, Real Property Acquisition, are in 49 
CFR 24.101.
Section 24.102(c)(2) Appraisal, Waiver thereof, and Invitation to Owner
    We received 28 comments on the NPRM appraisal waiver provisions. 
Twelve support the changes proposed in the NPRM.
    Five commenters disagree with the proposed ``two-tier'' waiver 
threshold, especially the provision that the property owner be given 
the option to have an appraisal if the Agency wishes to use a waiver 
threshold between $10,000 and $25,000. These comments expressed the 
position that this procedure would be confusing and not really 
accomplish much.
    In response to the language proposed in the NPRM, we received 
comments requesting waiver thresholds far in excess of $10,000. 
However, the Agencies are not comfortable with a waiver threshold over 
the proposed $10,000 limit without additional safeguards for the 
property owner. Part of this caution is based on the regulatory history 
of the present policy, which links the appraisal waiver threshold to 
the cost of appraisal, i.e., a concern that appraisal costs were 
exceeding acquisition costs. The final rule does not change the NPRM 
proposal. We point out that use of the appraisal waiver provision is 
optional for an Agency, so if appraisal waiver provisions become 
burdensome or ineffective, the Agency need not implement them.
    Two commenters expressed concern that appraisal waiver provisions 
risked property owner protection and were inconsistent with OMB 
Circular 92-06, which states, ``Agencies should prepare real estate 
appraisal and appraisal review reports in accordance with written and 
approved agency standards consistent with the Uniform Standards of 
Professional Appraisal Practice (USPAP), sections (sic) I-III, as 
developed by the Appraisal Standards Board of the Appraisal 
Foundation.''
    We point out that appraisal waivers for low value acquisitions are 
specifically authorized by the Uniform Act, Section 301(2). We share 
the concern that property owners retain protections intended by the 
Uniform Act. That is one reason why we did not raise the waiver 
threshold to any higher level. As for the issue of consistency with 
USPAP, appraisal waiver is not an appraisal performance issue, but an 
issue about when an appraisal is needed under Federal law.
    A question was also raised as to whether the threshold applies to 
the value of the larger parcel (before value) or the value of the 
proposed acquisition.
    The regulation states that it applies to the ``anticipated value of 
the proposed acquisition.''
    One commenter suggested removing the ``on a case-by-case basis'' 
language from proposed Sec.  24.102(c)(ii) because it created 
confusion.
    We did remove the ``on a case-by-case-basis'' language from the 
final rule as it was unclear.
    There was one comment expressing concern about situations where a 
high percentage of an Agency's acquisitions may be through appraisal 
waiver procedures.
    The FHWA shares that concern and is considering initiating research 
to examine this issue as it applies to our partner State DOTs; however, 
it is beyond the scope of this rulemaking action.
    Two commenters pointed out (and support) that the NPRM proposed 
adding language that the determination to use an appraisal waiver must 
be made by a qualified person.
    We are pleased to see not only support for this provision, but that 
it was significant enough to comment on it.
    Because of the number of comments indicating confusion in general 
as to the appraisal waiver provisions, we have added further 
explanation in appendix A.
Section 24.102(f) Basic Negotiation Procedures
    Two commenters suggested that ``reasonable opportunity'' provided 
to an owner to consider and respond to an offer should be defined with 
a specific time frame (such as 30 days).
    We did not include a required time frame, but appendix A does 
discuss the issue, stating that, depending on the circumstances, 30 
days would seem to be a minimum time frame. We are reluctant to specify 
a time frame because we believe that circumstances can dramatically 
impact what is an appropriate reasonable opportunity to consider an 
offer and present information.
    One commenter stated that giving property owners ``a reasonable 
opportunity to consider the offer'' has the potential to slow down 
project times.
    We recognize this potential, however, we believe this statement 
reflects the primary purpose of the Uniform Act and this regulation, 
which is to assist and protect property owners and occupants.
    One commenter suggested that Agencies should provide the owner and/
or his/her appraiser a copy of the Agency's appraisal requirements and 
inform them that their appraisal should be based on those requirements.
    This is an excellent idea, and we have included language to 
encourage Agencies to do this in appendix A.
    One commenter suggested adding the word ``all'' to ``reasonable 
efforts to contact the owner.''
    We agree and added the word ``all'' to the final rule for greater 
clarity.
Section 24.102(i) Administrative Settlement
    Comments indicated support for this section, but noted that not 
much was changed. We agree. The revised language focuses more on 
clearly stating the supporting justification for settlements.
    One commenter suggested that Sec.  24.107, certain legal expenses, 
should be cross-referenced in this section.
    Since the topics and issues are different, we did not make that 
change.
    We have revised the language to require more specific information 
in the written justification (``state'' rather than ``indicate'') and 
deleted specific suggestions (``appraisals, recent court

[[Page 597]]

awards, estimated trial costs, or valuation problems'') in favor of 
requesting ``what available information, including trial risks, 
supports the settlement.''
Section 24.102(n) Conflict of Interest
    The NPRM proposed expansion of this section to include all persons 
making waiver valuations under Sec.  24.102(c)(2). This change would 
bring equal conflict of interest standards to all individuals valuing 
real property, whether their work is waiver valuations, appraisal, or 
appraisal review, and would clarify who is covered.
    We received 24 comments on the proposed revision to this section. 
The majority of comments referenced the proposal that any person 
functioning as a negotiator shall not supervise or formally evaluate 
the appraiser, review appraiser or person making waiver valuations.
    Comments received focused on the impacts on Agency operations. A 
major concern was how an Agency could comply with the requirement that 
an appraiser, review appraiser or anyone making a waiver valuation not 
be supervised or evaluated by anyone negotiating for the property since 
currently most, if not all, managers frequently become involved in 
negotiations.
    This is a difficult issue, but we, as well as the other affected 
Federal Agencies, continue to support the provision providing 
independence for appraisers from officials negotiating to acquire the 
property.
    One commenter recommended that no Agencies be exempted from 
appraiser independence provisions and suggested that streamlined 
appraisals and reports could be used to meet budgetary needs.
    The exemption is not based on financial considerations, but rather 
on recognition that some small Agencies, especially Federal-assistance 
recipients such as local public Agencies, do not have the staffing 
levels that are needed to support the separation of functions.
    One commenter wondered about the impact on consultants of providing 
independence for appraisers from officials negotiating to acquire the 
property, and suggested the ethical controls in the Uniform Standards 
of Professional Appraisal Practice (USPAP)\1\ are sufficient.
---------------------------------------------------------------------------

    \1\ Uniform Standards of Professional Appraisal Practice 
(USPAP). Published by The Appraisal Foundation, a nonprofit 
educational organization. Copies may be ordered from The Appraisal 
Foundation at the following URL: https://www.appraisalfoundation.org/
html/USPAP2004/toc.htm.
---------------------------------------------------------------------------

    We note that USPAP controls apply to the appraiser, whose only 
recourse to inappropriate pressure from a manager or supervisor is 
refusal to do the assigned task. We believe that this does not 
adequately address conflict of interest concerns. Policing conflict of 
interest should not be the appraiser's responsibility. The impact on a 
consultant will ultimately be up to the funding Agency, which may waive 
this provision if it believes it appropriate to do so. Again, the 
responsibility to prevent undue pressure on an appraiser is on the 
Agency.
    One commenter suggested the same (Agency) person should be able to 
procure contract appraisal services and serve as a negotiator.
    This comment was from a local public Agency, which, as such, would 
be eligible for a waiver if granted by the Federal funding Agency, 
therefore we did not incorporate such a change.
    One commenter expressed a concern that a Federal Agency could give 
itself a waiver from the requirement that negotiators may not supervise 
appraisers.
    We believe the regulation is clear that the waiver is only for ``a 
program or project receiving Federal financial assistance.'' This 
precludes the Federal Agency from granting itself a waiver.
    One commenter supported the exception in the last paragraph, which 
allows the appraiser, the review appraiser and preparer of a waiver 
valuation to also act as negotiator when the offer to acquire is 
$10,000 or less. However, another commenter objected to this exception, 
stating the issue was too important to allow a waiver.
    Another commenter suggested the $10,000 threshold be raised to 
match the appraisal waiver threshold.
    One commenter objected to allowing appraisers to act as negotiators 
in acquisitions under $10,000.
    We did not change the threshold amount because the participating 
Federal Agencies continue to believe that the $10,000 limit provides a 
reasonable and appropriate exception for low value transactions. The 
rule adopts the conflict of interest language proposed in the NPRM.
Section 24.103 Criteria for Appraisals
    One commenter asked if there is some way we could require that all 
appraisals prepared for use under the Uniform Act meet appraisal 
requirements in this rule. The commenter was referring to appraisals 
made other than for the Agency, such as for property owners.
    Many jurisdictions grant broad authority to property owners to 
express their opinions about their property, and some even compensate 
them for the costs of an independent appraisal. We see no way we can 
require appraisal requirements in this rule for property owners' 
appraisals or other valuation opinions. We suggest Agencies make 
available their appraisal requirements to property owners so at the 
least they will know what the requirements are for the Agency's 
appraisal(s).
    The revisions relating to appraisals in Sec. Sec.  24.103 and 
24.104 are the first since The Appraisal Foundation published the USPAP 
in 1989. Considerable confusion and misunderstanding as to the 
applicability of the USPAP provisions to Uniform Act real property 
acquisitions have existed ever since USPAP was first published. The 
Uniform Act and 49 CFR part 24 set the requirements for appraisal and 
appraisal review in support of Federal and federally-assisted 
acquisition of real property for government projects. Many of the 
revised provisions of Sec. Sec.  24.103 and 24.104 are intended to 
assist the appraiser, the Agency and others in understanding the 
requirements of these subparts in light of the USPAP.
    We changed the terminology throughout this section from 
``standards'' to ``requirements'' to avoid confusion with USPAP 
standards rules. We also added the phrase ``Federal and federally-
assisted program'' to more accurately identify the type of appraisal 
practices that are to be referenced, and to differentiate them from 
private sector, especially mortgage lending, appraisal practice.
    One commenter suggested we use USPAP Standards 1, 2 and 3 for 
several reasons. Certified and licensed appraisers in most States are 
required to comply with USPAP, and although the Jurisdictional 
Exception may be used where the USPAP is contrary to law or public 
policy, that complicates matters unnecessarily. Also, USPAP standards 
are already in place, and this would assure the Federal government, 
taxpayers and property owners that appraisals and appraisal reports 
comply with certain minimum standards.
    Uniform Act appraisal requirements have been in place for some time 
and actually predate USPAP. They were put in place to do what the 
commenter suggests: provide assurance that when an Agency needs real 
property, all the parties involved are treated fairly. That is the 
primary purpose of the Uniform Act. As for the USPAP Jurisdictional 
Exception, we believe any ``complication'' is mostly based in 
misunderstanding of how it works. In any case, USPAP Jurisdictional 
Exceptions are by definition based in law or public policy and the 
Agency has

[[Page 598]]

very little, if any, flexibility for optional compliance with the 
Uniform Act.
Section 24.103(a) Appraisal Requirements
    In the NPRM we proposed stating that these regulations set forth 
the requirements for real property acquisition appraisals for Federal 
and federally-assisted programs to make it clear that other performance 
standards, such as USPAP and those issued by professional appraisal 
societies, do not directly govern programs covered by the Uniform Act. 
Based on the comments we received, this proposed language clarified the 
relationship between the appraisal requirements in this rule and USPAP 
and we have included that language in the final rule. Additionally, we 
have added further explanatory language in appendix A.
    The NPRM proposed adding a requirement for a scope of work 
statement in each appraisal. The scope of work replaces the former 
appraisal problem statement. It also renders obsolete the former 
``minimum standards'' and ``detailed'' appraisals, replacing them with 
an infinitely variable standard driven by the circumstances of each 
acquisition. We have included in appendix A a discussion on preparing 
the scope of work.
    We received several comments supporting the adoption of the scope 
of work. One commenter suggested that the scope of work for Uniform Act 
purposes needs to be clearly differentiated from the scope of work 
required by USPAP.
    As of the publication of this regulation, the Appraisal Standards 
Board has not finalized the scope of work in USPAP, so it would be 
premature to attempt to differentiate. It is our hope that the two 
concepts will be consistent and that a scope of work written in 
compliance with this rule will be compatible with any future scope of 
work requirement in USPAP.
    One commenter said that the appraiser should not be able to 
unilaterally determine the scope of the assignment or what the 
appraiser will provide the Agency. However, another commenter suggested 
that the appraiser should decide the scope of work, perhaps in 
consultation with the client (Agency). This comment was made as part of 
a discussion about the Agency instructing the appraiser that in certain 
circumstances, the sales comparison approach would be the only approach 
to value to be used.
    We point out that Agencies have had input to the appraisal process 
under the old rule. First, the ``sales comparison approach only'' 
option has been available to Agencies for many years and has, to our 
knowledge, caused no problems. Second, these requirements are written 
on the basis that the Agency is a ``knowledgeable user'' of appraisal 
services. That is, the Agency is familiar with both the appraisal 
process and its own needs, and is capable of participating in a 
legitimate statement of work to solve the appraisal problem. 
Accordingly, we believe that appraisers should not be given final 
authority over the appraisal process for an Agency. We believe it is 
appropriate that this option continue to be retained by the Agency.
    One commenter said it believes the purpose and/or function of the 
appraisal, a definition of the estate being appraised, and if it is 
market value, its applicable definition, and the assumptions and 
limiting conditions should be stated separately, and not be in the 
scope of work.
    We believe the scope of work, as a vehicle of agreement between the 
appraiser and the Agency, is the appropriate place to include these 
items. They should also be included in the appraisal report, as part of 
the scope of work statement.
    One commenter questioned the meaning of ``the extent appropriate'' 
for application of the Uniform Appraisal Standards for Federal Land 
Acquisition (UASFLA).\2\
---------------------------------------------------------------------------

    \2\ The ``Uniform Appraisal Standards for Federal Land 
Acquisitions'' is published by the Interagency Land Acquisition 
Conference. It is a compendium of Federal eminent domain appraisal 
law, both case and statute, regulations and practices. It is 
available at https://www.usdoj.gov/enrd/land-ack/toc.htm or in soft 
cover format from the Appraisal Institute at https://
www.appraisalinstitute.org/ecom/publications/default.asp and select 
``Legal/Regulatory'' or call 888-570-4545.
---------------------------------------------------------------------------

    The UASFLA is a publication that summarizes Federal eminent domain 
appraisal case and statute law. So, to the extent that an Agency either 
follows Federal eminent domain practices, or voluntarily adopts UASFLA 
as its appraisal guidelines, it may be applicable.
    Another commenter recommended that the appraisal clearly define and 
list which items are considered as real property and which are 
considered as personal property.
    We agree and the regulation and appendix A have been revised to 
reflect this suggestion.
    Still another commenter suggested the five-year sales history be 
changed to ten years since the property may not have changed hands in 
the last five years.
    Although we did not change the requirement in the regulation, we 
point out that its requirements are minimums. If the appraiser or the 
Agency believes higher levels of performance are necessary, then the 
appraisal scope of work should reflect that.
Section 24.103(a)(2)(ii) Appraisal Requirements
    A commenter suggested that USPAP compliance would require 
appraisers to invoke the USPAP Departure Provision