236.5 Property Management: Difference between revisions

Realty Asset Management addresses the management of Commission-owned land and interests in land. The goal of Realty Asset Management is to retain a minimum of excess property, while pursuing the best value for every dollar spent for the properties that are leased or conveyed, and to effectively relinquish roadways that are excess to the state highway system.

The parameters of this pursuit include, Revised Statutes of Missouri, at RSMo 227.290; the Code of Federal Regulations, at CFR Title 23, Part 710, Subpart D, the Missouri Constitution, at Article 1, Section 27, and Commission Policy, as captured in the Commission Minutes, including the Delegation of Authority and Execution of Documents Policy (particularly Section E).

While RSMo 227.290 purports to grant to the Missouri Highways and Transportation Commission (MHTC) the discretion to convey at no cost to any federal, state, or local governmental entity any land or leasehold estate, such assets can be viewed as road funds, and as such, are constitutionally prohibited from being diverted from the stated purpose of such funds. All proposed conveyances of realty assets shall demonstrate an offsetting benefit to the transportation system, regardless of the grantee, unless approved by the Right of Way Director prior to any agreement otherwise. Commission delegation of authority policy requires that any proposal to grant a property to an agency without cost, in accordance with this statute, shall be approved by Commission Minute. Additionally, if federal funds were used in the acquisition of the parcel, Title 23, Part 710, Subpart D, Section 403(d1) requires such proposals to be approved by the Federal Highway Administration (FHWA).

RSMo 227.290 requires that excess land and leasehold estates be sold or exchanged for approximate fair market value. Notwithstanding the above-noted exception, the consideration received by the Commission for each parcel shall be shown to represent the approximate fair market value.

It is important to note that all conveyances of real property interests must be executed by the Chair or Vice-Chair of the MHTC.

It should also be noted that property held by the “State of Missouri” without mention of the MHTC, requires legislative action to convey the property and clear title. If excess land being conveyed is titled in such a manner, the Right of Way Section Office should be notified immediately. It will be the division office’s responsibility, with the assistance of the district, to work with Governmental Relations and Chief Counsel’s Office to obtain the governor’s signature to convey the excess land.

236.5.1.1 Federal Highway Administration (FHWA) Oversight

The Code of Federal Regulations, particularly at Title 23, Part 710, Subpart D, establishes additional parameters for the conveyance, relinquishment, or leasing of realty within the Interstate System (IS), or realty otherwise acquired with Federal funds. The Right of Way Section will secure FHWA concurrence prior to the consummation of any transaction requiring FHWA oversight.

FHWA shall have oversight on all proposed conveyances, roadway relinquishments, and new leases of land within the limits of the IS. Said oversight shall include the determination of the land as excess to the system, or otherwise available for a specific use by lease or airspace agreement, as well as the consideration to be received. Parcels acquired as uneconomic remnants as part of an IS project and not incorporated into the IS do not require FHWA approval for disposal.

All proposed conveyances of land outside of the IS limits acquired with Federal funds shall be submitted to FHWA for concurrence as to the proposed transaction conforming to Title 23, Part 710, Subpart D, Section 403(d1) when the consideration is less than the approximate fair market value. Relinquishments of roadways outside the limits of the IS are not subject to FHWA oversight.

If FHWA requires additional terms or conditions to concur with a transaction, the district will be advised of, and will address, the required terms or conditions. Also, if the Right of Way Section provides approval to deviate from the department's policy as set forth in this article, or conditions of the disposal or new lease are revised subsequent to FHWA approval, FHWA approval shall be secured prior to consummation of the transaction.

236.5.1.2 Missouri Highways and Transportation Commission Approval and Commission Delegated Approvals

Right of Way Director Approval (Tier 1)

The Right of Way Director shall approve property appraised below $200,000.

Missouri Highways and Transportation Commission Approval (Tier 2)

Property appraised for $200,000 or more requires approval from the Right of Way Director, Controller, Assistant Chief Counsel and Director of Program Delivery. Approval must be executed prior to the inclusion as a Commission agenda item.

As allowed under the Commission’s June 14, 2006 policy regarding disposition of Commission-owned property or property rights, the sale of all properties owned by the Commission that appraised for values of $200,000 or more must be approved by specific Commission action.

Proposed transactions with federal, state or local governments to convey property at no cost or exchange interest in land or leasehold as allowed by RSMo 227.290(2) will be presented to the Commission for consideration.

The Right of Way Section reviews all documents and submits to FHWA (if applicable.)

236.5.2 Realty Asset Inventory

Real property owned by the Commission is managed with the use of an application/system within the Transportation Management System (TMS) that provides an inventory of all Commission-owned realty assets. The application is known as the Realty Asset Inventory (RAI).

To keep the system current, the districts shall provide a completed RAI for each conveyance, each new lease, and each new remnant acquired or excess parcel created. Roadway relinquishments are to be accounted for within the RAI as well. Any parcel previously classified as excess that is reclassified to an active parcel in the highway system must also be submitted on the RAI Form for reclassification in the RAI System. Instructions for completing the RAI Form are available.

236.5.3 Asset Management Committee

Each district shall establish an Asset Management Committee (Committee). The district right of way manager may be the chairperson of this Committee. In addition to the district right of way manager, the Committee shall include at least one member each from district design, planning, maintenance, traffic, construction and materials, area engineer or Construction and Materials engineer, and the assistant district engineer or district engineer. The Committee may include additional members, as the district deems appropriate. The district utilities engineer and the district’s professional land surveyor shall serve either as members or at least ex officio members. If the asset is classified as a capital improvement, district general services shall be included on the committee.

The Committee is to review each request not only for the excess issue, but also to ensure that any issues related to a Change in Route Status Report (CRSR) and Change in Route Marking Report (CRMR) that is tied to the excess issue is addressed at the same time.

The Committee is to review each request to purchase excess property, including capital improvement sites and uneconomic remnants. The district Asset Management Committee will also review requests to lease Commission-owned property or to use the Commission-owned property in such a manner as to make an airspace agreement appropriate. The Committee shall decide if it is in the best interest of the Commission and MoDOT to dispose of or lease the requested property. In all cases, consideration must be given to any possible need to retain the area for a future highway project.

The Committee will also review requests for annexations, roadway relinquishments, breaks in access, as well as other proposals affecting Commission real property.

236.5.4 Origin of Request & Processing Fee

When a requestor is interested in acquiring Commission-owned property, district personnel indicates that a processing fee of $250 is required and does not apply toward the purchase price. No processing fee is charged if the department initiates the sale, if it is determined that the asset must be sold by public sale (i.e. sealed bid, auction, division between abutters, etc.), if the request comes from a governmental agency, or if the asset is being conveyed to the original donor. The $250 processing fee is only refunded when the Asset Management Committee denies a request or the request becomes eligible for a public sale (see EPG 236.5.6.1 Refund Request Guidelines). Once the processing fee is received, complete a Receipt-Transmittal of Money Form and submit it to district business & benefits services (see EPG 236.5.22 Transaction Submittal to Right of Way Section).

236.5.5 MoDOT Employees Purchasing Excess Property

Should an employee of the department, as an adjacent owner, request to purchase any department-owned excess property, the district’s asset management committee shall provide all facts to the Right of Way Director who shall review the request for approval. Employees shall have the right to bid on any excess property that is being sold by public sale except those employees with prior knowledge of the approved values of said excess property. (See Personnel Policy 2514 – Conflict of Interest.)

236.5.6 Handling of Funds Received

When district right of way receives a Receipt-Transmittal of Money Form from the district business & benefit support for the sale of improvements, excess property, rent, etc., they shall immediately fill in the lower half of the form with the following information:

1. Route

2. County

3. Project number

4. Excess number or file number

5. Reason for payment

6. Grantee or lessee

7. Dollar amount

8. What step in the process the payment represents

9. History of any previous payments transmitted for the transaction

10. Date the monies were received

11. Contact person and telephone number of person who can answer questions in reference to the transaction

Forward the receipt and one copy back to the district business & benefits support for further processing. A copy of the receipt shall be placed in the district right of way file and a copy forwarded to the Lotus Notes Group, RW RAI. If the property is a capital improvement site, General Services Facilities Management in the Central Office shall also be copied on the email.

Where cash is provided, the remitter shall be given a cash receipt by the person accepting the payment and a Receipt-Transmittal of Money Form shall be filled out in full. The cash, along with the original and one copy of the Receipt-Transmittal of Money Form, shall be taken to district business & benefits support for further processing. Also a copy of the Receipt-Transmittal of Money Form shall be placed in the district right of way file and a copy shall be forwarded to the Lotus Notes Group RW RAI.

236.5.6.1 Refund Request Guidelines

1. Any refund request of monies received toward the sale or lease of realty assets shall be emailed to the Controller’s Division, Accounts Receivable section with a copy to the RW RAI email group. The following information shall be included in the email:Transmittal number and date of transmittal

2. Grantee/Buyer of Record/Lessee

3. Remittance name and address

4. Type of real estate transaction (i.e. sale or lease)

5. Dollar amount and what step it represented (i.e. $250 for processing fee; $1,000 for *10% down payment)

6. County

7. Route

8. Acquisition Job or Project Number (If capital improvement, include job number, i.e. TJ number

9. Parcel Number, E Number, and/or File Number

Once processed, the Controller’s Division will respond by email that the check has been issued.

236.5.7 Identifying Excess Realty Assets

Any parcel of realty owned by the Commission might potentially become excess in time. Until it obtains an excess status as determined by the Asset Management Committee, all real property, including capital improvements, uneconomic remnants, permanent easements, mitigation sites, etc., is considered to be active.

236.5.7.1 Annual Review of Commission Land for Excess

Excess and future project land shall be periodically evaluated to determine whether the various parcels should be reclassified, conveyed, leased, or retained. The Realty Asset Inventory (RAI) shall be maintained to accurately reflect the true classification of each parcel. Land identified as excess, or available for lease, shall be marketed as such.

On an annual basis, the district Asset Management Committee shall review the excess inventory as well as land owned for future projects, and provide the Right of Way Section with a Work Plan by July 1 of each year. This Work Plan shall include the parcels that will be marketed and sold during the upcoming fiscal year.

236.5.7.2 Marketing Real Estate for Sale and Lease

Each district shall aggressively and expeditiously market property that is available for disposal or lease. When the Asset Management Committee determines that such properties are available, district right of way will proceed to actively market and sell the properties. Marketing shall go beyond merely working to sell parcels for which a request has been made. Examples of acceptable marketing venues include:

1. Internet Advertisements

2. Newspaper Advertisements

3. Use of Realtors

4. Sealed Bids

5. Open Houses

6. Public Auction

7. Special Signing

236.5.8 Marketing Guidelines

If a public sale is needed, a sale venue appropriate to the parcel shall be chosen based on the specific property and its potential value. Options include an auction, listing with a real estate broker, in-house marketing, or a competitive bid process.

For a public sale, formal advertising is required. The minimum requirements for any realty offered via public sale are:

1. Legible sign for at least 30 days indicating the property is for sale and a phone number or web address. This provides a minimal assurance of exposure.

2. Internet advertising is available through coordination with the Right of Way Section. The parcel can be submitted to central office for the web with the Internet Posting Request.

Advertisements and signs shall indicate the contact information needed to obtain the sale details. Potential advertising methods include the internet, newspaper, printed material, media, real estate agents, national marketing firms, etc. Advertising costs shall be considered with the property sale potential in establishing a marketing plan.

236.5.9 Uneconomic Remnants

236.5.9.1 Definition

An uneconomic remnant is any area of real property in which the owner is left with an interest after the partial acquisition of the owner’s property, and in which the acquiring agency has determined that the area has little or no value or utility to the owner.

236.5.9.2 Disposal of Uneconomic Remnants During Negotiations

The district is authorized to negotiate for the exchange (trade) of Commission-owned uneconomic remnants for other property or rights needed for the project from adjoining property owners in accordance with procedures in EPG 236.7 Negotiation.

236.5.9.3 Sale of Uneconomic Remnants Prior to Clearance of the Project

Prior to clearance of the project, the district is authorized to negotiate for the outright sale of any uneconomic remnants that were purchased and not traded during negotiations, in accordance with procedures set out in EPG 236.5.26 Acquired Improvements.

236.5.9.4 Final District Action Involving Uneconomic Remnants

When negotiations are complete on a project, the asset management committee shall review all uneconomic remnants purchased and not disposed of to determine whether or not these uneconomic remnants will be retained as active real property or as excess property.

District design will assure that final plans are revised to incorporate uneconomic remnants retained as active real property. District right of way shall ensure that district design is aware of the changes that need to be made.

236.5.10 Excess by Change in Route Status

See EPG 236.14.1.4 Change in Route Status Report (CRSR)).

236.5.11 Future Excess Property

When a project involves the realignment of a roadway, the existing roadway and associated property may become future excess property. Future excess properties may be appraised at the same time the property for the project is being appraised. The district may then negotiate for the exchange (trade) of Commission-owned future excess property for other property or rights needed for the project from adjoining property owners in accordance with procedures in EPG 236.7.2.13 Payment Prior to Possession. If the deed is delivered prior to completion of the new project, the new deed shall include the following paragraph:

"The Missouri Highways and Transportation Commission retains full, free, and uninterrupted use and possession of the land herein conveyed until completion of construction and acceptance of the project for the construction of Route__________________ by the Commission’s District Engineer."

236.5.11.1 Disposal of Future Excess Not Traded During Negotiations

Upon completion of the project, the district shall attempt to sell all remaining excess not traded during negotiations. Procedures in EPG 236.5.9.4 Final District Action Involving Uneconomic Remnants are to be used as a guide for the disposal of this remaining excess.

236.5.12 Excess Land Conveyances & Relinquishments – Regulated Utilities

All conveyances and relinquishments of Commission-owned property shall be evaluated for the existence of any regulated utility facilities located within the areas to be conveyed or relinquished. Regulated utility facilities consist of the regulated utilities as defined by the Public Service Commission. By law, regulated utilities have the right to locate within Commission-owned property. Therefore, a conveyance or relinquishment of Commission-owned property may have implications to the utility facilities, and the utility providers who own such facilities, when the Commission no longer controls the property. It is important to maintain the continuity of utility facilities for the general public; therefore, to identify and minimize potential impacts, MoDOT shall involve utility providers in the conveyance and relinquishment processes.

236.5.12.1 Excess Land Conveyances Utilities

MoDOT shall only recommend that a property be declared excess upon satisfactorily addressing the utility impacts. Whether MoDOT or an external party initiates the conveyance of excess property, utility impacts shall be addressed by using one of the following methods:

1. Each utility will be relocated by permit into a new utility corridor retained by the Commission.

2. Each utility will remain in place with the benefit of a non-exclusive permanent utility easement.

If the Commission holds fee simple title to the property, the Commission shall convey a non-exclusive permanent utility easement to each utility provider.

If the Commission holds a less than fee simple title interest in the property, MoDOT shall facilitate the conveyance of a non-exclusive permanent utility easement from the party acquiring the property to each utility provider.

3. Each utility will be relocated to another portion of the property being conveyed.

If the Commission holds fee simple title to the property, the Commission shall convey a non-exclusive permanent utility easement to each utility provider.

If the Commission holds a less than fee simple title interest in the property, MoDOT shall facilitate the conveyance of a non-exclusive permanent utility easement from the party acquiring the property to each utility provider.

4. Each utility will be relocated onto a portion of the property already owned by the party acquiring the Commission-owned property, with the benefit of a non-exclusive permanent easement. (MoDOT shall facilitate the conveyance of a non-exclusive permanent utility easement from the party acquiring the property to each utility provider.)

5. A three-party negotiated settlement taking into consideration the overall value of the proposed transaction.

6. Additional options to address utility impacts may be utilized with approval from the right of way director.

236.5.12.2 Road Relinquishment Utilities

MoDOT shall only recommend the relinquishment of roadways through the Change in Route Status Report upon satisfactorily addressing the utility impacts. If the roadway will be relinquished to a local public transportation authority, with the intent that it continues to be used as a public roadway, the following clause shall be included in the deed from the Commission to the local public transportation authority:

"Grantee, by acceptance of this conveyance, covenants and agrees for itself, its successors and assigns, to allow known or unknown utility facilities currently located on the property, whether of record or not, to remain on the property, and to grant the current and subsequent owners of those facilities the right to maintain, construct and reconstruct the facilities and their appurtenances over, under, and across the land herein conveyed, along with the right of ingress and egress across the land herein conveyed to and from those utilities."

Proposed roadway relinquishments to private entities shall be reviewed in a manner consistent with the conveyance of excess property described in EPG 236.5.3 Asset Management Committee.

236.5.13 Utility Easements Across Commission Property

Utility easements across Commission property located outside of the land limits of the highway system may be granted without compensation if it offers a net benefit to the Commission property or Commission project. Such an easement shall otherwise require approximate fair market value. Such compensation may be determined to be offset by the value added to the site. The district may accept the valuation provided by the utility company if it appears reasonable. The district may value such easement based solely on the difference between the before and after values of the subject parcel. Even when it is in conjunction with a MoDOT project, the easement area shall be designed to limit the impact on the realty asset’s value. For instance, allowing a utility facility to be placed diagonally across a remnant should generally be avoided.

Easements are to be submitted on Form RW13, which must be approved as to form by the Chief Counsel's Office prior to Commission execution. The document is to be executed by the utility provider/grantee prior to submittal. Since the document conveys a realty interest, it will also be executed by the Commission’s Chair or Vice-Chair. Once fully executed, the district shall ensure that the document is recorded at the county recorder of deeds office. The submittal of the easement to the Right of Way Section shall include a plan sheet or site plan depicting the easement area, as well as a memo outlining the request with the value of the easement and/or, where appropriate, justification for not charging the utility provider. If the site contains a capital improvement, such as a maintenance building, the memo shall demonstrate concurrence from district general services. A property inventory record is not needed.

Easements shall not be granted within the land limits of the highway system.

All approved easement agreements, as a conveyance of a real property interest, shall be executed on behalf of the Commission by the Chairman or Vice-Chairman and attested to by the Commission Secretary.

236.5.14 Release of Temporary Easements and Retention Clauses

Occasionally a property owner will request that a temporary easement that is no longer in effect or retention of possession and use clause in a deed be released. This request is usually made at such time as the owner is selling the property and the easement or clause causes a cloud on the title. This release can be accomplished by one of the following, depending upon which method is acceptable to the title company handling the title work for the owner.

1. A letter stating that the project is complete and the easement is no longer in effect. The letter is to be signed by the district engineer.

2. An affidavit signed by the district engineer attesting to the completion of the project and release of the easement.

3. A quitclaim deed executed on behalf of the Commission by the Chairman or Vice-Chairman.

Quitclaim deeds to clear up clouds on titles created by temporary easements or retention clauses shall be executed by the Chairman or Vice-Chairman and attested to by the Secretary. No processing fee is charged in these situations.

236.5.14.1 Release of Permanent Easements

Permanent easements acquired by the Commission for special uses such as slope maintenance and drainage shall be processed the same as other excess as defined in EPG 236.5.4 Origin of Request & Processing Fee.

236.5.15 Methods for Disposal

A. Fee simple interest is held; all types of excess property

When the Commission holds an excess stand-alone parcel in fee, the site is generally made available to any potential buyer and disposed of by public sale. However, if the parcel is determined to be non-stand-alone, the excess can be sold directly to the abutting property owner(s). If there is more than one abutting owner, each must be contacted to determine each owner’s interest in acquiring the area being considered for disposal or any part thereof. If all owners express an interest in the area, it should be disposed of by a competitive bid sale among the interested parties. However, it is possible for each abutting owner to purchase only a portion of the excess, or for one abutting owner to purchase the entire excess. If each owner agrees in writing to an apportionment of the excess, or if all but one of the abutting owners waives their interest by signing a waiver, a competitive bid need not be pursued and the single owner can be dealt with individually.

B. Stand alone excess; less than fee simple interest is held

1. Regional counsel shall determine the underlying fee owner when the property value is more than $25,000. Once identified, the districts shall offer to sell the excess to the fee holder(s) based on an appraisal and proceed in good faith negotiations toward the sale of the Commission’s interest.

2. If the sale of the Commission’s interest to the underlying fee-holder cannot be negotiated, the district shall negotiate a three-party agreement with the underlying fee-holder and buyer whereby the sale proceeds are to be split between the Commission and the underlying fee-holder. The district may then proceed to sell the excess by competitive bid or other public sale.

3. Property valued at $25,000 or less may offered by public or directed sale without use of a three-party agreement.

4. With prior approval of the right of way director, the three-party agreement may be waived for property valued at more than $25,000 and the property offered by public or directed sale as stipulated in said approval.

The purchasers shall be advised of the Commission’s interest in the property and that another party might hold the underlying fee interest. They are also to be advised that the Commission is willing to release its interest in the property; however, it will be the responsibility of the purchasers to explore the title to their satisfaction. When the Commission holds less than fee simple interest in the property and it is being conveyed to someone other than the underlying fee holder the conveyance document shall include a full disclosure clause.

C. Non-stand-alone excess; less than fee simple interest is held

1. Offer to sell the property to the adjoining owner holding the fee at a price based on an appraisal and proceed in good faith negotiation toward the sale of the Commission’s interest.

2. Where the excess is a frontage strip, and no abutter holds the fee, divide the excess at right angles to the centerline at the existing abutters’ property corners. Offer to sell the property to the respective abutters and proceed in good faith negotiation toward the sale of the Commission’s interest.

3. When the property is valued at $25,000 or less, it may be conveyed to the adjoining owner for a $1 consideration, for the established value, or at an amount between $1 and the established value.

Other options may be pursued if each owner agrees in writing to an apportionment of the excess. If all but one of the abutting owners waives their interest by signing a waiver, there is no need for a competitive bid sale and the abutting owner can be dealt with individually.

The purchasers shall be advised of the Commission’s interest in the property, and that another party might hold the underlying fee interest. They are also to be advised that the Commission is willing to release its interest in the property; however, it will be the responsibility of the purchasers to explore the title to their satisfaction. When the Commission holds less than fee simple interest in the property and it is being conveyed to someone other than the underlying fee holder the conveyance document shall include full disclosure clause.

236.5.16 Legal Opinion of Title

Once the Committee has approved disposal of the excess, district regional counsel shall determine if the Commission has fee simple interest or less than fee simple interest in the area.

236.5.16.1 Fee Simple vs. Less Than Fee Simple Interest

This distinction represents the level of the Commission’s ownership in a parcel.

Excess conveyances require a legal opinion as to title to proceed. The Commission’s ownership interest in the property is to be determined. Relinquishments do not require a legal opinion as to title as long as the roadway will continue to be used as a public roadway.

The Realty Asset Sale Legal Opinion Memo may be provided for regional counsel’s use, or the district may use another format. The format shall clearly indicate the Commission’s ownership interest in each parcel that makes up the excess site.

All of the relevant acquisition documents are to be provided to regional counsel to establish a legal opinion of title. If the fee holder is to be identified, plan sheets of the acquisition project(s) are relevant, as well.

Where the Commission owns the fee, the title is not a limitation on the market potential (or pool of prospective purchasers) of the parcel. In this case, an appraisal will be the primary guide in determining the market for the property. See “Stand Alone” vs. “Non-Stand Alone” below.

Where the Commission owns less than fee, the title can present limitations on the market potential of the parcel. It is generally most preferable to deal with the underlying fee holder, as identified by the regional counsel’s opinion, unless such a sale would create a “spite strip” or otherwise affect the rights of the abutters not holding the underlying fee interest. Where the adjoiner is the underlying fee holder, a direct negotiated sale to the underlying fee owner shall be pursued.

236.5.16.2 Stand-Alone vs. Non-Stand-Alone

This distinction represents the market potential of a property. If the field of potential purchasers of a parcel is limited to the adjoining owner(s) by factors such as access, size, shape, value, etc., that makes its purchase unfeasible to any other member of the public, it is generally a non-stand alone property. If the field of potential purchasers reasonably extends beyond the adjoining owner(s), the parcel is a stand-alone property. This distinction is to be indicated in the appraisal.

If the Highest and Best Use is determined to be assemblage, the property can be considered to be non-stand-alone. Stand-alone parcels are to be marketed publicly to ensure a sale at approximate fair market value, whereas non-stand-alone parcels may be sold directly through good faith negotiations (based on an appraisal) to the adjoining owner(s).

236.5.16.3 Adjoining Ownership

RSMo 227.290 requires that in all instances, where the original grantor of excess to MHTC is still in possession of the adjoining property, that property owner shall be notified in writing before the consummation of any sale of the excess. Where that still-adjoining owner donated the property without cost to MHTC, the property shall be conveyed back to owner without cost.

236.5.17 Valuing Excess Property

RSMo 227.290 stipulates that the Commission is to obtain approximate fair market value for excess realty, except as addressed in this article (236.5 Property Management). For the purpose of this chapter in meeting requirements established in state statute and in the CFR, “approximate fair market value” shall include that prices (in money or exchange) concluded as follows: a) for excess parcels that are non-stand-alone or owned as less-than fee; through direct negotiation with the entire market for the property, such as all adjoining owners, or the fee owner; or, b) for marketable stand-alone excess parcels; through an open public sale process based upon the appraised value and subsequent good faith negotiations, a public auction, or other competitive bid process. The documentation submitted to the Right of Way Section shall demonstrate how the transaction represents the approximate fair market value of the parcel. For more on valuing excess property, see EPG 236.6.3.7 Realty Asset Valuation.

The appraisal and the title opinion together help define the sale process most appropriate to the parcel. The appraisal is used to determine the potential market (stand alone or not) and the title opinion (fee or less than fee) may further define the field of potential purchasers.

236.5.18 Categorical Exclusion (CE) Review

A Categorical Exclusion (CE) is required for realty asset conveyances, leases, airspace agreements, and road relinquishments.

Full disclosure of the exceptions or conditions noted in the CE report shall be made to potential purchasers when conveying realty assets (provide a summary of the CE exceptions, not a copy of the form itself). All requirements included within the CE report shall be addressed prior to consummation of the transaction.

District Right of Way completes Section A of the Categorical Exclusion Form, and submits it with attachments to Environmental Unit, Design Division, Central Office. The environmental unit researches the request to make the CE determination and completes Section B of the CE form and returns it to district Right of Way. This process must be repeated if the original review occurred more than three years prior to the date the property will be conveyed, the size of the parcel to be conveyed has changed or the land use of the parcel differs from the original submittal. The form provides for an update request in Section A and an update response in Section B. A copy of the original form should be used when requesting an update. Attachments need to be included with the request for an update.

236.5.19 Survey Requirements

To ensure compliance with Section 327.272 RSMo with regard to the disposition of right of way, the property description within each conveyance, if different from the property description within the acquisition document, must be reviewed by a professional land surveyor (PLS). The PLS may determine that the conveyance property may be adequately described without a survey, or that a survey is required for the conveyance.

Properties may be conveyed without additional surveys when the property descriptions are obtained from the last deed or deeds of record and are conveyed as a whole, without subdivision or alteration. If the Grantee is to provide the survey as part of the transaction, district right of way shall review the survey to ensure that it encompasses the area approved by the Asset Management Committee and does not include land or features that the Committee intended to be retained.

District Right of Way shall attempt to accomplish surveys with district survey resources. If district survey resources are unavailable or cannot meet the required timeframe, district Right of Way may complete the Request for Excess Parcel Survey Form 236.5.19a and submit it with the required attachments to the CADD Services Engineer, Design Division, Central Office. The Central Office Survey Staff, in conjunction with the Central Office Right of Way Section evaluates the request to make the determination of acceptance to perform the survey. Once a survey is complete, the Central Office Survey Staff returns it to district Right of Way.

236.5.20 Realty Transactions

Realty transactions involve an agreement, or contract, for the transfer of realty interests, and the fulfillment of the terms thereof, which usually includes the delivery of a deed.

236.5.20.1 Exchanges

Excess land may be negotiated in exchange for land needed for an MHTC project as described in EPG 236.7.2.10 Uneconomic Remnants and Future Excess Property. The value of a remnant in an exchange may be much greater than the diminished uneconomic value attributed to it when acquired and the best value shall be sought in an exchange.

Although a separate appraisal is not required in such an exchange, the value in exchange shall be shown to be the approximate fair market value and the details of the exchange provided in the Negotiator Report or Administrative Settlement for the acquired property. These documents are to be provided with the excess conveyance submittal.

A CE must be acquired for exchange parcels if one has not been specifically completed for conveyance of the parcel. If the appraised value of the excess parcel is $200,000 or more, the exchange will require Commission approval by Commission Minute. All excess can be used in the negotiations for the acquisition of land required for a project. The deed for the excess may be executed and delivered prior to project completion. If any part of it may be needed during the project, but the deed is to be delivered prior to project acceptance, continued possession shall be assured by the use of the retention of possession clause. Utilities shall be addressed in any exchange in the same manner detailed in EPG 236.5.12 Excess Land Conveyances & Relinquishments – Regulated Utilities. An RAI Form must be completed and submitted for both the excess and the acquired parcels in an exchange.

Other exchanges are possible, as long as the value received for the excess can be shown to be the approximate fair market value. Exchanges must comply with the NEPA process as far as obtaining clearance prior to acquiring a parcel.

236.5.20.2 Transaction Agreements

Whether by Sales Agreement or other agreement, all transactions shall include some evidence of the commitment by the grantee. While it will most often be in the form a Sales Agreement (RW22), other possibilities include a Roadway Relinquishment Agreement (RW 27), a Cost Share Agreement, a County or Municipal Agreement, or some other form approved by CCO. If the appraised value of an excess parcel is $200,000 or more, the authority to execute the document is to be established by Commission Minute, unless CCO determines such authority is granted otherwise in the delegation of authority policy.

District right of way shall use the Sales Agreement (RW22) on all sale transactions in the amount of $5,000 or more. When using the sales agreement, a 10% security deposit shall be collected at the signing of the agreement. The security deposit is in addition to the processing fee. The balance due at closing will reflect the settlement price minus the security deposit. A cashier's check, personal check, or money order tendered by the requesting party and made payable to "Director of Revenue - Credit State Road Fund" shall be required. Upon receipt of the security deposit, district right of way shall process a transmittal to District Business & Benefits Services as described in EPG 236.5.6 Handling of Funds Received. The Sales Agreement Form RW22A may be used for nominal disposals where neither the Commission nor the grantee holds the fee interest.

The district engineer has the authority to execute sales agreements, which are contingent upon further Commission approval. However, any sales agreements with parcels having an appraised value of $200,000 or more must be presented to the Commission for consideration prior to execution.

In cases where the sale is unable to close on the date set out in the Sales Agreement, an Extension of Closing Date Addendum (Form 5-20.2), can be used to extend the closing date. Both the buyer and the district engineer shall sign the addendum. The extension agreement can be used as many times as necessary to extend the closing date, as long as both parties are agreeable to the extension. If either party is not agreeable to the extension, the contract is void. If the buyer is in default, the processing fee and security deposit shall be retained as per the agreement. If MoDOT is unable to deliver an executed deed, as per the agreement, the purchaser's processing fee and security deposit will be refunded.

Care shall be taken to address all of the specifics of the transaction. The Sales Agreement shall address access if it is limited, the billboard restriction if on a controlled route and fee is held, any easement reservations, and any further Committee stipulations, such as drainage plan approval. Additional conditions to the sale required by the CE shall be incorporated into the agreement. If the property is classified as a capital improvement, or otherwise includes structures to be included in the sale, district right of way will request an Asbestos Survey Report and Painted Concrete Report from the Materials Division.

236.5.20.3 Property Description in Sales Agreement

The sales agreement may provide that the Commission or purchaser provide the exact property description to be included in the deed. Alternatively, if the property description is included in the Sales Agreement, it shall be prepared in accordance with EPG 236.4.6 The Description.

236.5.21 The Conveyance Document

All conveyances of real property or real property rights shall be executed by the Chair or Vice-Chair of the Missouri Highways and Transportation Commission.

A Quitclaim Deed, (Form RW1) is used to convey the Commission’s property interest. A Warranty Deed, (Form RW4), may only be used for capital improvement sites that were acquired in fee simple title by warranty deed, or with approval by regional counsel. The use of a general warranty deed is extremely limited. Concurrence to do so shall be sought from the Right of Way Section and regional counsel.

It is important to be thorough in addressing all issues that need to be in the deed. The Sales Agreement should be the primary point of focus for the deed. If done properly, the sale agreement will address all items that need to be within the deed. It is imperative that the deed writer ensures that the property description in the deed conforms to the survey requirements.

236.5.21.1 Controlled Access

When no access or a specific access break is to be granted along with the conveyance of an excess property, an access clause shall be included in the conveyance document.

236.5.21.2 Utilities

Utilities shall be addressed according to EPG 236.5.12 Excess Land Conveyances & Relinquishments – Regulated Utilities.

236.5.21.3 Retention of Possession

It is possible to sell or exchange excess prior to project acceptance. When the deed is delivered prior to completion of the new project, the deed shall include the following paragraph”

"The Missouri Highways and Transportation Commission retains full, free, and uninterrupted use and possession of the land herein conveyed until completion of construction and acceptance of the project for the construction of Route_________________ by the Commission’s District Engineer."

236.5.21.4 Reversion of Property to the Commission

There may be situations when it is in the best interest of the Commission to convey property to another party with conditions that would result in the property reverting to the Commission’s possession. When instances like this occur, a reversionary clause shall be included in the deed. Contact the district’s regional counsel’s office for assistance with developing a reversionary clause appropriate to the specific situation.

236.5.21.5 Public Use

There are situations when it is in the Commission’s best interest to convey property to a city, county, or other political subdivision that is to be used solely for public purposes. In conveyances such as these, the conveyance deed shall include a clause that results in the property reverting to the Commission should the property cease to be used for public purposes. Consult with the district’s regional counsel’s office for assistance with developing language appropriate to the specific situation.

236.5.21.6 Full Disclosure Clause

When the Commission holds less than fee simple interest in the property and it is being conveyed to someone other than the underlying fee holder the conveyance document shall include full disclosure language as follows:

“This conveyance is in the nature of an abandonment of an easement for roadway purposes and, therefore, conveys no possessory interest. It is incumbent upon grantee to seek their own professional opinion as to the resulting state of the title.”

236.5.21.7 Acceptance of Conveyance

When excess property is conveyed to a city, county, or other political subdivision, the district shall obtain an Acceptance of Conveyance (Form RW42) document executed on behalf of the city, county, or political subdivision.

236.5.22 Transaction Submittal to Right of Way Section

All conveyances and relinquishments shall be reviewed and approved in the district prior to submittal to the Right of Way Section. Once reviewed and approved by the district, a parcel packet shall be saved to the RAI FTP site as a subfolder labeled with the packet’s “E” number within the district’s folder. When the parcel packet has been saved to the FTP site, the district shall send an email to the “RW RAI” group stating that the parcel is ready for processing. Parcel packets shall include the following:

1. Transaction Memo, which describes the chain of events leading to the transaction submittal (RWmemo.doc)

2. Copy of executed agreement, if applicable (SlsAgrmnt. pdf)

3. Quitclaim deed or other deed of conveyance (Deed.doc)

4. Categorical Exclusion Review (CE.pdf)

5. Appraisal of the property (Appraisal.pdf)

6. Title Opinion or Commitment, including acquisition documents (Title.pdf)

7. Highway Plan as acquired with a depiction of the excess (AcqPlan.pdf)

8. Current highway plan with a depiction of the excess (ExstPlan.pdf)

9. RAI Form (RAI.doc)

10. Survey of the parcel (Survey.pdf)

11. Asset Management Committee Minutes (AMC.pdf)

12. Utility determinations and correspondence (Utilities.pdf)

13. Maps or aerials showing the property (Maps.pdf)

14. Administrative Settlement on property exchanged, if applicable (AdmStlm.pdf)

15. Copy of advertisement, if sold by a competitive bidding process

16. Other relevant documents (Misc.pdf)

236.5.23 Agreement Approval and Deed Execution

The Right of Way Section will review the submittal. Upon concurrence that the proposal is in the best interest of the Commission, the Right of Way Section shall pursue Commission approval of the conveyance, as prescribed in the Commission’s Execution of Document Policy or by specific Commission Minute. The Sales Agreement (RW22) is contingent upon such approval. When in accordance with 236.5.1.1 Federal Highway Administration (FHWA) Oversight, FHWA concurrence is required for the transaction. The Right of Way Section shall seek FHWA approval when required. Commission approval shall not be obtained without the required concurrence by FHWA.

With the required approvals of the request, the deed of conveyance will be forwarded to the Commission Secretary for execution by the Chair or Vice-Chair on behalf of the Commission. If approved by the Commission, the deed will be executed on behalf of the Commission.

236.5.24 Closing Sale

Upon receiving the executed instrument, the district shall arrange the closing of the sale. The closing can either be handled in person or by mail. If handled in person, it is recommended that a department representative meet the buyer at the County Recorder’s Office. The buyer shall tender the balance of the purchase price by either cashier’s check or money order. Upon receiving the balance of the purchase price, the district representative will deliver the deed to the buyer and have the buyer record the deed. If the closing is handled by mail, the buyer shall be advised to send the district a cashier’s check or money order for the balance of the purchase price along with a check made payable to the county recorder for the recording fee. The district will mail the deed aloing with the check for recordation to the recorder’s office with a request the deed be returned to MoDOT. When the recorded deed is returned, copies shall be made as required and the original recorded deed shall be sent to the grantee.

The district shall place either a copy of the recorded deed, or a copy of the executed deed with the recording information written on it, in the district deed file. It shall be filed with the deed by which the property was originally purchased. A copy of the executed deed, plat, plan sheet, and area map shall be furnished to district maintenance and the Design Division.

236.5.25 Leases and Airspace License Agreements

All non-highway use of Commission property is to be administered through an approved agreement. The use of Commission real property is generally addressed with a Lease (RW14) or Airspace License Agreement (RW28).

Leasing excess Commission real property is generally not desirable, and should only be done as an interim solution to selling the excess.

The Asset Management Committee shall decide if an area is available for non-highway use, subject to an environmental review. An approved use must be consistent with the continued operation, maintenance, and safety of the facility, and such use shall not result in the exposure of the facility’s users or others to hazards. The committee shall also recommend the duration period of the agreement. The terms of any agreement are subject to approval by the right of way director, and for areas within the Interstate System, concurrence from FHWA.

The committee shall be presented with all of the relevant details of a proposed use. If the requested area is beneath a highway structure, the Security Assessment for Leased Areas shall be provided as completed for review of the security requirements. It is incumbent upon the committee to provide for the direction needed to address all relevant factors of a request, including the oversight of proposed tenant improvements, if any.

On-premise signs, displays, or devices indicating the type of on-premise activities may be erected independently or upon structures occupying highway airspace. Nothing classified as outdoor advertising shall be permitted. Local ordinances and requirements shall apply. Uses allowed by lease or license agreements shall not include the manufacture or storage of flammable, explosive, or hazardous material or any occupation that is deemed by MoDOT to be a hazard.

236.5.25.1 Application/Request for Leases

The application or request may be generated internally or externally. A $250 processing fee may be required for new lease and license requests. The fee is not to be applied to the rental payments, but is refundable should the request be denied. Requests from governmental agencies for non-proprietary uses may be processed without charge and without a processing fee.

Each of the following items must be included in an application:

1. Identification of the party requesting the use, as well as any others who may be responsible for developing, occupying, and maintaining the airspace

2. A general statement of the proposed use

3. The proposed design for the use of the space, including any facilities to be constructed, if any

4. Maps, plans, or sketches to adequately demonstrate the relationship of the proposed project to the highway facility, with the level of detail in proportion to the complexity of the request

236.5.25.2 Environmental Review for Leases

A Categorical Exclusion (CE) shall be obtained prior to any new lease or license agreement , but is not required for a lease renewal as long as the use remains the same. Any special terms of the CE shall be incorporated into the lease or license agreement.

236.5.25.3 Valuation – Compensation for Leases

If a non-proprietary use (as agreed by Counsel) is proposed by a political subdivision of the state, or other governmental entity, the district engineer may authorize such a lease or license agreement without charge. No appraisal is needed if this option is pursued. FHWA concurrence is required for properties within the Interstate System.

The value of the lease or agreement shall otherwise be established in accordance with the EPG 236.6.1 Overall Operating Policies. The lessee shall be charged the value as so established, or another amount logically reasoned to be in the best public interest and approved by the Right of Way Director.

236.5.25.4 Marketing Properties for Lease

Leases for areas that have only one prospective tenant may be directly negotiated without marketing or a bid process. If there is more than one prospective lessee, it shall be shown that all prospective adjoining property owners are afforded the opportunity to bid on the lease. Dividing the lease area between interested parties may be an option. Those areas that have a market potential beyond the adjoining property owners shall be made available to the public through a competitive bidding process. The level of advertising is at the district’s discretion, but it shall not preclude the notification of the adjoining owners. A real estate broker may be enlisted as with marketing excess properties.

236.5.25.5 Risk Assessment

The standard lease insurance limits are $500,000 per individual and $3 million per occurrence. A reduction or waiver of the standard insurance limits may be permitted through a Real Estate Risk Assessment Form. The district engineer may sign the assessment. The risk assessment form shall be included with the lease submittal to Central Office when the required insurance is reduced. A copy is to be forwarded to the Risk Management Director for quality assurance tracking and review. See Risk Management Ch 9 and 10/05/06 Blanket Exception –(2)Leases.

236.5.25.6 Security Assessment for Leased Areas

When the proposed agreement includes an area beneath a highway structure or it proposes a structure to be placed above or beneath a highway facility, a Security Assessment Form shall be completed by a district bridge representative. The security provisions established shall be incorporated into the agreement. The Security Assessment form shall be provided to the Right of Way Section with the lease submittal.

Additionally, when the lease is intended to allow automobiles to be driven or parked in an area beneath a highway structure that includes piers supporting the structure, as a minimum precaution, a Bridge Column Protection for Vehicular Traffic diagram shall be attached as Exhibit A-1 and the following shall be added to the lease :

"At Lessee's expense, Lessee will provide and maintain wheel stops around Lessor's concrete piers located in the leased area. The exact specification concerning said wheel stops are contained in Exhibit A-1, which is attached to this lease agreement and made a part thereof. Lessee will maintain during the term of the lease said wheel stops in good condition and appearance. Ownership of the wheel stops around the concrete piers of the viaduct and any surface improvements, shall pass to the Lessor absolutely at the end of the term of the lease."

When the lease is intended to allow for truck traffic beneath a highway structure, as a minimum precaution, a Bridge Column Protection for Truck Traffic diagram shall be attached as Exhibit A-2 and the following shall be added to the lease:

"At its own expense, Lessee will provide and maintain corrugated metal jackets backfilled with sand around Lessor's concrete piers located in the leased area. The exact specifications concerning these protective jackets are contained in Exhibit A-2, which is attached to this lease agreement and made a part thereof. Lessee will maintain, during the term of the lease, said protective devices in good condition and appearance. Ownership of the protective corrugated metal jackets around the concrete piers of the viaduct and any surface improvements, shall pass to the Lessor absolutely at the end of the term of the Lease."

All stipulated security measures shall be inspection items for the continued maintenance of the lease.

236.5.25.7 Lease of Premises

The Lease of Premises (RW14) addresses the minimum required provisions for a lease without further review by CCO. Additional stipulations by the Asset Management Committee, the CE, or the Security Assessment shall be incorporated into the lease when appropriate. The Lease of Premises (RW14) includes notary acknowledgements. Use of the notary acknowledgement pages are at the discresion of the district unless the lease will be recorded. In this instance the notary acknowledgement pages must be completed and made a part of the recorded lease. Any other revisions to the standard form are to be approved by CCO. This form is for a distinct period not to exceed five (5) years, unless prior approval has been obtained from the Right of Way Section.

Where the leased area crosses the plane of a highway facility improvement, such as the lease of space beneath a highway structure, the property description shall adequately address the three-dimensional aspects of the leased area. At a minimum, the area description shall include the following:

"The vertical dimensions of the described property leased herein stops at and shall not extend above a plane horizontal to and eight (8) feet below the underside of the viaduct carrying said (Route) passing along and above the described premises."

Leases of Commission property are to be approved and executed by the right of way director.

236.5.25.8 Airspace License Agreements

Airspace is that space within the boundaries of the highway system not physically occupied by the highway facility. Although a lease (RW14) of airspace is technically an “airspace agreement,” the Airspace License Agreement (RW28) allows for a more permanent use, generally to accommodate a specific structure or improvement to be constructed, used, and maintained by the licensee. Examples of situations in which an airspace agreement is applicable are:

1. tunnels under the highway,

2. overhead walkways,

3. trails,etc.

Form RW28 is more of a template than most forms and the final agreement will require extensive collaboration between the district and CCO.

Because each Airspace License Agreement is specific to the requestor, exploring other prospective users or marketing options is not needed.

236.5.25.9 Lease/Airspace License Submittals to Right of Way Section

Airspace License Agreements and complex new leases shall be submitted to the Right of Way Section prior to execution by the licensee for concurrence by the right of way director. Non-complex leases, such as those with no form revisions, for appraised value, to the only eligible lessee, do not require prior submittal.

Airspace License Agreements and new leases on the Interstate System must be reviewed and approved by FHWA as described in EPG 236.5.1.1 Federal Highway Administration (FHWA) Oversight prior to execution.

All supporting documents of each request are to be transmitted electronically via the ftp site as described in EPG 236.5.22 Transaction Submittal to Right of Way Section and are to include the following items:

1. Transaction Memo, which describes the chain of events leading to the lease submittal.

2. Asset Management Committee Minutes

3. RAI Form

4. Current highway plans of the area

5. Highway plans of the area as acquired

6. Appraisal or other valuation documents

7. Categorical Exclusion determination

8. Security Assessment, if applicable

9. Risk Assessment, if applicable

10. Insurance binder for the required coverage amount, naming MHTC as an additional insured

11. Copy of the request from leassee/licensee

In addition to these electronic submittals, four (4) originals of the agreement (one each for the district, the Right of Way Section, Controller, and lessee) executed by the lessee/licensee shall be submitted to Central Office for review and execution. When needed, execution by CCO for approval as to form will be obtained through Central Office. However, the district must ensure that the document has been approved by CCO prior to execution by the lessee/licensee.

The Right of Way Section reviews all proposed leases and airspace agreements. When required within the parameters outlined in EPG 236.5.1.1 Federal Highway Administration (FHWA) Oversight, the Right of Way Section shall submit the proposal to the FHWA for concurrence. Additional support or revisions may be required for approval.

When a lease is approved, and necessary CCO approval as to form is obtained, and FHWA concurrence is obtained, the right of way director will execute the lease. (See the Execution of Documents Policy).

Once approved and executed, the district shall receive two executed agreements. The district shall retain an original and deliver the other to the lessee/licensee. A copy of the insurance certificate shall be collected and a copy forwarded to the Right of Way Section. District maintenance shall also be advised of the lease agreement.

Upon approval of the agreement, Accounts Receivable will coordinate rent billing and collection. Thereafter, lease payments should be sent by the lessee/licensee directly to the Controller.

236.5.25.10 Initial Inspection & Annual Inspections

Upon establishment of a lease or airspace license agreement, the district must establish initial compliance with any conditions of the agreement, including security measures.

The district shall inspect each leased or licensed site at least once a year to ensure compliance with the terms of the lease and/or license, which will be tracked in the RAI.

236.5.25.11 Renewal of Lease Agreements

The District Asset Management Committee shall review all renewals.

Prior to the expiration of a lease, a determination shall be made by the district whether the lease may be renewed to the current leasee, or will be remarketed. If only one party is interested, district right of way may negotiate an acceptable rental arrangement. In all cases, a current rental study shall be prepared.

After preparation of the new lease, four (4) original copies executed by the lessee, along with two (2) copies of the rental estimate and a letter summarizing the district's review shall be forwarded to the Right of Way Section for approval and execution. The submittal letter shall state if this is a new lease or a renewal.

236.5.25.12 Cancellation of Lease or Airspace Agreement

If a lease agreement is not renewed, or if either party desires to terminate a lease or airspace agreement, a letter shall be forwarded by the district to the lessee/licensee detailing the expiration, cancellation, or termination including the date of repossession of the property. The district shall concurrently forward the letter electronically to the Right of Way Section and the Controller to advise of the action. The district shall also forward the notice to all appropriate district personnel.

An inspection of the property to ensure possession and condition of the property shall be relayed to the Right of Way Section and any appropriate district personnel.

236.5.26 Acquired Improvements

236.5.26.1 Inventory

All improvements that can be removed intact or razed from property and/or property rights acquired shall be included in an inventory compiled by project and parcel. Such improvement information should be assembled from the appraisal documents, Negotiator's Report, appropriate legal documents, or by field inspection.

The improvement inventory record shall be maintained by each right of way office on the Improvement Inventory Form (Form 5-26.1) and shall be placed in each project file.

When outdoor advertising is acquired, the outdoor advertising specialist shall be notified through the Outdoor Advertising Profile Report.

236.5.26.2 Asbestos Inspection Request

Prior to the sale or demolition of any improvements acquired as part of a project, the Construction and Materials Division is to perform an asbestos inspection. Requesting the inspection is the responsibility of district design. Upon receiving possession of all improvements on a project, or at least a sufficient number to make efficient use of inspection time, district right of way shall provide the following information to district design:

1. Job number

2. Tract numbers of properties to be inspected

3. Addresses of properties to be inspected

4. Plan sheets showing location of the properties

5. Appraisal floor plan sketches of ALL buildings to be inspected

236.5.26.3 Rodent Control

Upon possession of improvements, district personnel shall inspect the premises and determine if rodents are present. Where such inspection reveals the presence of rodents, immediate action shall be taken to provide proper extermination, except where the improvement is to be immediately removed by a demolition contractor and extermination is a part of the contract. The Missouri Pesticide Act restricts the purchase and application of restricted-use pesticides to individuals who are certified through the Department of Agriculture. MoDOT does not have certified personnel to handle these restricted-use pesticides and a state-certified professional rodent exterminator should be contacted. Where land and improvements are acquired adjacent to or as part of a sanitary landfill and evidence of rodents exist, the district should notify the Right of Way Section that they will coordinate the extermination through the Division of Health.

236.5.26.4 Extension of Possession

When the proposed letting schedule permits, an owner or tenant may be authorized an extension of possession based on a monthly rental rate, as hereinafter set out. An Extension of Possession Agreement shall be used when the original occupant is allowed to extend possession up to one year. If it is necessary to extend possession beyond the one year time period, the Extension of Possession Agreement shall be cancelled and replaced with a Lease of Premises Agreement. An extension of possession that is expected to last beyond one year is to be written on a Lease of Premises Agreement rather than an Extension of Possession Agreement. The district engineer can execute an Extension of Possession Agreement but only the director of program delivery, or the right of way director can execute a Lease of Premises Agreement for MHTC real property on behalf of the Commission. Several requirements with reference to preparing this agreement are set forth in EPG 236.8.1.14(e). After execution, a copy of the Extension of Possession Agreement is to be forwarded to the Right of Way Section.

When an owner or a tenant is granted an extension of possession, a monthly rental rate shall be established and collected in advance for each monthly period of extension. The rental value for owner-occupied and tenant-occupied property will be determined as follows:

1. Owner-Occupied

The monthly rental rate for an owner-occupied improvement will be based on one of two methods: (a) 80 percent of the economic rental rate as determined from the market for comparable units, or (b) two-thirds of one percent of the agreed purchase price of the property when market rental data is not readily available. It will be necessary to apply the "carve out" method if only a portion of the property is to be rented, with the rate being established to the nearest dollar.

2. Tenant-Occupied

The monthly rental rate for tenant-occupied property will be 80% of the actual rent being paid by the tenant when the property is acquired. In rare cases where tenants are not paying rent, the monthly rental rate will be 80% of the economic rental rate for similar property within the area. All rates shall be computed to the nearest dollar.

3. Free Extension

Sometimes as a result of an approved administrative settlement, an extension of possession may be granted at no cost.

4. Cancellation

When either party cancels an Extension of Possession Agreement, the district shall advise the Controller’s Division by letter of such action with a copy to the Right of Way Section and any appropriate district offices.

If the Extension of Possession Agreement is being replaced with a Lease of Premises Agreement, it is not necessary to notify the Controller’s Division. Four copies of the Lease of Premises Agreement are to be submitted to the Right of Way Section with an explanation that the lease is replacing the Extension of Possession Agreement.

236.5.26.5 Acquisition and Disposal of Mobile Homes

The Department of Revenue in Jefferson City has advised that state agencies are not required to hold title and can purchase mobile homes on a bill of sale. The bill of sale must be notarized. At the time of disposal, a new bill of sale should be used and the title and a copy of the original bill of sale given to the buyer, who, in turn, will take it to the Department of Revenue for transfer of title. The title will actually transfer from the previous owner to the new owner. With a copy of the bill of sale in hand indicating the state held the title until transfer, the new owner will not have a penalty to pay.

At the time of disposal, the district engineer can sign the title for the sale of the mobile home as provided in the Execution of Documents Policy.

236.5.26.6 Disposal of Improvements

Districts are authorized to dispose of improvements by public sale after asbestos testing and abatement action has been completed (see 127.8 Hazardous and Solid Waste for more specific guidelines). Public sale can be either by auction or sealed bid. When conditions warrant, prior approval may be obtained from the Right of Way Section to dispose of improvements without a public sale. If the improvements are salvaged back to the owner, asbestos testing and abatement is not required.

When sealed bids are taken for the disposal of improvements, a 10% deposit in the form of a cashier's check, personal check or money order shall be required along with the bid. This 10% deposit shall be part of the purchase price for the successful bidder. As soon as the bids are in and the improvement awarded to the successful bidder, all other deposits will be returned. Prior to submitting a bid, all prospective bidders shall be made aware that if the successful bidder declines the purchase of the improvement, the deposit will be forfeited.

Those improvements subject to vandalism should be disposed of as soon as possible after possession. If prompt disposal of such improvements is not possible, the property should be secured (boarding up all doors and windows) by maintenance personnel or by an independent contractor. If independent contractors are used, they shall be employed by competitive bidding or in emergency or hazardous situations by securing estimates from known contractors.

Every attempt must be made to allow the public adequate notice of the sale. The district can either advertise in local newspapers in the area with general circulation or place a for-sale sign on the property. The advertisement or sign should provide instructions of where to obtain more information about the property for sale. If the sale is advertised in a local newspaper, the Controller’s Division requires an affidavit to accompany the statement and a copy of the advertisement before payment will be made.

The purchaser of any improvement shall be required to execute the Sale of Improvement and Performance Bond Agreement (Form 5-26.6). The agreement is to be signed by the district engineer or designated representative. The amount of the performance bond should cover any cost the Commission would incur if the purchaser fails to comply with the terms of the agreement. This agreement may be revised for special situations subject to approval by the Right of Way Section and the Chief Counsel's Office. Checks for improvements are to be made payable to the "Director of Revenue-Credit State Road Fund." Checks for performance bonds are to be made payable to the "Director of Revenue-Credit State Road Fund-Escrow Account." Submit performance bond by separate check.

All receipts and performance bonds shall be submitted directly to district controller’s office with a copy of the transmittal to the Right of Way Section.

236.5.26.7 Transferring Improvements or Fixtures

When it is determined that other departments have a need for certain improvements or fixtures from a right of way project, a transfer of such improvements or fixtures must be documented by the district and prior approval of the transfer must be received from the district engineer of the district initiating the transfer request. When all approvals are secured, the Right of Way Section will process the proper paper charge documents through the Controller’s Division thereby transferring the improvement or fixture to the requesting department. District right of way shall take appropriate action to record such transfers on the project Improvement Inventory Form.

236.5.26.8 Removal by Demolition Contract

When the district determines that it is in the public interest to raze improvements on a given project, district design will be responsible for administering this activity. District right of way shall advise district design when legal and physical possession of the improvements is obtained. District right of way shall take appropriate action to record such action on the Improvement Inventory Form.

All preconstruction demolition charges shall be a part of the right of way project.

236.5.26.9 Backfilling

When considered necessary by the district engineer, MoDOT will backfill basements, swimming pools, etc., either by state personnel or contract. All such contracts will be awarded based on competitive bids. Each district shall use the following documents Specifications for Filling Basements and/or Foundations (Form 5-26.9) and Contract Agreement (Form 5-26.9a) (the specifications and a contract) on a county, route, and project basis. Advertising for bids shall be in local newspapers and all persons qualified to accomplish this work shall be furnished copies of the bid proposal. Contractor's Notice to Proceed shall be issued at the earliest possible date.

Supervision of backfilling will normally be the responsibility of the Construction and Maintenance Division. Each district should develop internal procedures for such inspections.

236.5.26.10 Plugging Wells

Measures must be taken immediately following possession of the property to ensure that uncapped wells do not become contaminated by surface water or debris prior to the final plugging during the construction stage. This can be done by one of the following methods:

1. Proceed immediately to plug the well in accordance with Statutes 256.600 to 256.640 RSMo.

2. Proceed immediately to seal the well from dirt and surface water infiltration and protect the well from contamination until it is finally plugged a permitted well driller or pump installer. Notify the Missouri Department of Natural Resources Wellhead Protection Section, Division of Environmental Quality when a well is temporarily sealed.

Care should be taken to ensure that wells are not contaminated by debris when a structure or building is moved from the site. The well is subject to contamination from the time the pump is removed and steps should be taken to prevent contamination as early as possible.

District construction is responsible for ensuring wells are plugged according to Statutes 256.600 to 256.640 RSMo and reported to the Missouri Department of Natural Resources Wellhead Protection Section, Division of Environmental Quality on a registration form provided by the division.

236.5.27 Removal for Public Safety

If hazardous conditions are created by burned-out buildings, cisterns, ponding in basements, or through vandalism that are of an immediate danger to public safety, districts must take corrective action to eliminate the hazard. Upon written requests from the district, the Right of Way Section will authorize corrective action without the benefit of competitive bids. All costs incurred in correcting hazardous conditions shall be charged as incidental costs to the right of way project involved.

236.5.27.1 Billboards Disposal Process

Districts shall determine a salvage value for a billboard as part of the parcel appraisal process and offer the structure back to the original owner. Salvage value is the probable sale price of an item if offered for sale to knowledgeable buyers, including the previous structure owner, with the requirement that it be removed from the property at a buyer’s expense. This includes items for re-use as well as items with components that can be reused or recycled when there is no reasonable prospect for sale except on this basis. The salvage value for billboard structures shall address the previous owner’s ability to utilize or move the salvaged item.

If the previous owner elects not to salvage the billboard, districts are authorized to dispose of the improvement by public sale. When conditions warrant, prior approval may be obtained from the Right of Way Section to dispose of improvements without a public sale.

In order to facilitate negotiations, district right of way may agree to leave a sign in place for a specific period of time by use of an Extension of Possession Agreement, (Form RW12), for the structure and the site. The agreement shall specify a definite date of expiration and physical possession. The term of the agreement shall in no way reference the project schedule.

It is imperative, in all instances, when outdoor advertising is acquired, the Outdoor Advertising Unit of the Right of Way Section must be notified. District right of way will contact the ODA specialist to schedule an “ODA Structure Inventory.” This inventory will be conducted during the conceptual plan/location study stage. The district right of way representatives and the ODA representative will travel the project while conducting an ODA inventory of potential impacted structures that are located near the preferred alignment. Pictures and notes will be taken at this time.

The ODA specialist will generate the profile form located in the Travelway Management System (TMS) and forward to district right of way. District right of way will place the forms in the General file.

If the structure is to be removed by district maintenance, upon acquisition, an email will be generated by the negotiator and sent to the appropriate area engineer, resident engineer, shed supervisor, and ODA specialist, notifying them of the acquisition. The request should ask that the structure be removed. This email will serve as the notification to ODA and no additional billing statement will be sent to the former owner of the sign. Upon removal by maintenance staff, a return email from the area engineer will be sent to the ODA specialist and the project manager verifying removal. ODA will track and monitor the removal. If the project manager is informed promptly after removal, structures will not be included in the contract.

If the structure is to be removed by a contractor, upon acquisition, the negotiator will complete the form and place a copy in the tract file and send the original to ODA.

The ODA specialist will track the removal of the structure. The ODA specialist will follow-up with the resident engineer to determine the approximate timeframe prior to removal.

236.5.27.2 Improvement Removal by Road Contractors

All improvements that remain on the right of way and are to be removed should be reported to district design prior to awarding the construction contract. These items will be included as a part of the construction contract. The project Improvement Inventory should be completed to indicate these items are included for removal in the prime construction contract.

236.5.28 Access Rights

236.5.28.1 Purpose

This information establishes procedures for the preparation of deeds and/or appraisals for changes in granting access rights on limited or fully controlled highways.

236.5.28.2 Entrance "Widening" or "Widening and Shift"

Access control is the responsibility of the Traffic Division. Shifts and/or the widening of entrances and the granting of access rights are handled by agreements prepared by the Traffic Division. These agreements are recorded.

1. Conveyance from MHTC

District right of way shall prepare a quitclaim deed on any entrance shift, widening, widening and shift, or granting of access rights on limited access highways at the request of district traffic. The deed shall be sent to district traffic as soon as possible, and they, in turn, will forward it to the Traffic Division. The Traffic Division will present the deed along with the agreement to the Commission for consideration. When the Commission has executed the agreement and deed, they will be returned to district traffic. District traffic will give the agreement and deed to district right of way for recording. If the agreement is approved before the deed is prepared from the Commission to the property owner, the deed, when prepared, shall be forwarded to the Traffic Division who will forward it to the Commission Secretary for execution on behalf of the Commission by the Chairman or Vice Chairman of the Commission.

2. Conveyance to MHTC

Should the property owner have to execute a general warranty deed to the Commission releasing the existing access rights, it shall be recorded at the same time as the agreement and deed from the Commission to the property owner.

NOTE: In situations where the new access rights overlap the existing access rights, the deed releasing the existing access rights must be recorded first.

The following paragraph shall be included in all conveyances to property owners involving limited access changes at locations that could be affected by future facility upgrade to expressway or freeway standards in the right of way and construction program:

"The herein change in limited access between the property and the highway shall continue as long as the Missouri Highway and Transportation Commission does not upgrade the present highway to an expressway or freeway. If the Missouri Highway and Transportation Commission makes the decision that the highway should be upgraded to expressway or freeway standards, then the herein access change will cease and any access between the property and the highway will revert back to the access status which existed immediately prior to the execution of this document. This condition is a covenant running with the land and will be binding upon all successors and assigns of the parties herein. Further, the reversion to the earlier access status will be without any compensation to the holder of the access rights. The reversion to the earlier access status will not affect any compensation to be paid for the acquisition of additional right of way. The decision to upgrade the highway to expressway or freeway standards is in the sole discretion of the Missouri Highway and Transportation Commission."

236.5.28.3 Compensation for Changes in Access

1. Contiguous Properties

Compensation to the Commission for changes in access rights on contiguous property will be according to the Value Determination Schedule. It is the responsibility of district traffic to determine the amount of compensation in accordance with the schedule.

2. Noncontiguous Properties

Compensation for a shift in access rights between noncontiguous properties shall be determined by an appraisal, when there is a change in highest and best use, or a demonstrable change in density of use to the property to which the access rights are being shifted. The amount of compensation shall be based on the appraised enhancement value to the property receiving the break in access. If there is no change in highest and best use or density of use, the compensation is to be determined from the Value Determination Schedule.

3. Break in Access

Compensation for a break in access, in which no shifting of an entrance is involved, is to be determined by an appraisal. The compensation charged shall be the enhancement value to the property for the break in access or determined from the Value Determination Schedule, whichever is higher.

4. Responsibilities

With respect to the above, it is the responsibility of district right of way to advise district traffic of the appraised enhancement value to the subject property. The responsibility of district traffic is to collect the appraised enhancement value from the property owner.

236.5.29 Departure Provisions

Specific political subdivision regulations may necessitate deviation from the above policies. Where deviations are required, the district shall advise the Right of Way Section. The Right of Way Section must approve deviation to the established policy.

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 Full disclosure of the exceptions or conditions noted in the CE report shall be made to potential purchasers when conveying realty assets (provide a summary of the CE exceptions, not a copy of the form itself).  All requirements included within the CE report shall be addressed prior to consummation of the transaction.
-District Right of Way completes Section A of the [[media:236.5 Categorical Exclusion Review (Form 3-1.2) Apr 2012.docx|Categorical Exclusion Form]], and submits it with attachments to [http://wwwi/design/units/enviromental.htm Environmental Unit, Design Division, Central Office].  The environmental unit researches the request to make the CE determination and completes Section B of the CE form and returns it to district Right of Way.  This process must be repeated if the original review occurred more than one year from the date of the conveyance.  The form provides for an update request in Section A and an update response in Section B.  A copy of the original form should be used when requesting an update.  Attachments need to be included with the request for an update.
+District Right of Way completes Section A of the [[media:236.5 Categorical Exclusion Review (Form 3-1.2) Apr 2012.docx|Categorical Exclusion Form]], and submits it with attachments to [http://wwwi/design/units/enviromental.htm Environmental Unit, Design Division, Central Office].  The environmental unit researches the request to make the CE determination and completes Section B of the CE form and returns it to district Right of Way. This process must be repeated if the original review occurred more than three years prior to the date the property will be conveyed, the size of the parcel to be conveyed has changed or the land use of the parcel differs from the original submittal. The form provides for an update request in Section A and an update response in Section B.  A copy of the original form should be used when requesting an update.  Attachments need to be included with the request for an update.
 ==236.5.19 Survey Requirements==