Difference between revisions of "236.5 Property Management"

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 Asst. to the State Design Engineer - Right of Way prior to any agreement otherwise.

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 shall be notified. 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.

Property that constitutes a road relinquishments will be conveyed without legislative action by a quitclaim deed using the full disclosure language.

Properties valued at $100,000 or less will normally be conveyed without legislative action (unless the conveyance is or has the potential to be controversial or sensitive) by a quitclaim deed using the full disclosure language. The Asst. to the State Design Engineer - Right of Way may waive the requirement for legislative action for property sold above $100,000.

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). 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 right of way 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.

236.5.1.2 Missouri Highways and Transportation Commission Approval and Commission Delegated Approvals

Asst. to the State Design Engineer - Right of Way Approval (Tier 1)

The Asst. to the State Design Engineer - Right of Way shall approve property appraised below $200,000.

Missouri Highways and Transportation Commission Approval (Tier 2)

Property appraised or sold for $200,000 or more requires approval from the Asst. to the State Design Engineer - Right of Way, Financial Services Director, Assistant Chief Counsel and Assistant Chief Engineer, and must be approved by specific Commission action.

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 Commission-owned realty assets. The application is known as the Realty Asset Inventory (RAI).

To keep the system current, the districts shall update the information within RAI, and load necessary documentation into media for each conveyance, each new lease, each new remnant acquired or excess parcel created and new land acquired. 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 should be updated in RAI as well.

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 should include one member from district design, planning, maintenance, traffic, construction and materials, area engineer, and the assistant district engineer or district engineer, along with additional members, as the district deems appropriate. If the asset is classified as a capital improvement, district general services should 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 Commission owned property, including capital improvement sites and uneconomic remnants. The 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 or license 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.

The Committee will also review requests for annexations and roadway relinquishments, 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 financial 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 Asst. to the State Design Engineer - Right of Way 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 financial services 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 financial services for further processing. A copy of the receipt shall be placed in the district right of way file. The Receipt-Transmittal may also be created and updated in RAI. An instructional video about how to create/update money transmittal in RAI is available.

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 financial services for further processing. Also a copy of the Receipt-Transmittal of Money Form shall be placed in the district right of way.

Refund Request Guidelines

1. Any refund request of monies received toward the sale or lease of realty assets shall be emailed to the Financial Services Division, Accounts Receivable section. 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. J number

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

Once processed, the Financial Services 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.

Review of Commission Land for Excess

Excess and future project land should 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.

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.

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 236.7.2.10 Uneconomic Remnants and Future Excess Property.

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.

236.5.10 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."

Disposal of Future Excess Not Traded During Negotiations

The district should 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 adequately 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 Asst. to the State Design Engineer - Right of Way.

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 Utility may also provide the valuation. 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 (Form RW13 is accessible in eAgreements), 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.

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 Chair or Vice-Chair 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 Chair or Vice-Chair.

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, it may be sold directly to a specific buyer. The district should base this decision on the specific characteristics of the property. 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 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.

3. Property valued at $25,000 or less may be 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, 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 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, the conveyance document shall include the full disclosure clause.

236.5.16 Legal Opinion of Title

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

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 the state of title to proceed. Road Relinquishments do not require a legal opinion as to the state of title as long as the roadway will continue to be used as a public roadway. If a former road will be used for private use, a legal opinion is required.

Parcels appraised for $25,000 or less that include any reference to “right of way” in the original acquisition deed can be reviewed by the District Right of Way Manager to determine to state of title as identified above. The full disclosure language will be included in the conveyance document, which releases whatever interest the Commission has in the subject property without making any claim to title.

When acquisition deeds do not include reference to “right of way”, Regional Counsel must establish an opinion on the state of title for parcels appraised for $25,000 or less. All relevant acquisition documents are to be provided to Regional Counsel to establish a legal opinion on the state of title, including plan sheets.

Where the Commission is the fee owner, the state of title does not cause a limitation on the market potential (or pool of prospective purchasers) of the excess parcel. In this case, an appraisal will be the primary guide in determining the market for the property. See EPG 236.5.16.2 Stand-Alone vs. Non-Stand-Alone.

Where the Commission owns less than fee, the state of title can present limitations on the market potential of the excess parcel. It is 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 owner, 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, 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 generally 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.

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 Review (Form 3.1.2), 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 commission owned property, 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. When a property boundary plat has been prepared, but a legal description has not, you may involve a title company or legal counsel to prepare and sign off on the description. Central Office Right of Way will review descriptions prepared and signed off on by a title company or legal counsel.

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, the district 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.

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.

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 Sales Agreement (RW22) (Form RW22 is accessible in eAgreements), other possibilities include a Roadway Relinquishment Agreement (RW 27) (Form RW27 is accessible in eAgreements), 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. A 10% security deposit shall be collected, regardless of the sale price. 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 Financial Services as described in EPG 236.5.6 Handling of Funds Received.

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 are subject to specific Commission action.

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 may 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, 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 Construction and 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) (Form RW1 is accessible in eAgreements) is used to convey the Commission’s property interest. A Warranty Deed, (Form RW4) (Form RW4 is accessible in eAgreements), 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, RW22 (Form RW22 is accessible in eAgreements), 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 Full Disclosure Clause

When the Commission holds less than fee simple interest in the property, the conveyance document shall include full disclosure language as follows:

“By conveyance through this quitclaim deed, the Missouri Highways and Transportation Commission makes no claim to the resulting title of the above-described property and is merely releasing whatever interest it has to the Grantee.”

236.5.21.6 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) (Form RW42 is accessible in eAgreements) 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. When the parcel packet has been uploaded to the RAI, the district shall send an email to the “RW RAI” group stating that the parcel is ready for processing. Parcel packets should include the following:

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

2. Copy of executed agreement, if applicable

3. Quitclaim deed or other deed of conveyance

4. Categorical Exclusion Review

5. Appraisal of the property

6. Title Opinion or Commitment, including acquisition documents

7. Highway Plan as acquired with a depiction of the excess

8. Current highway plan with a depiction of the excess

9. Survey of the parcel

10. Asset Management Committee Minutes

11. Utility determinations and correspondence

12. Maps or aerials showing the property

13. Administrative Settlement on property exchanged, if applicable

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

15. Other relevant documents.

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 Policy. The Sales Agreement (RW22) (Form RW22 is accessible in eAgreements) 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.

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 along 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 a copy of the recorded deed in RAI. A copy of the executed deed, plat, plan sheet, and area map should be furnished to district maintenance. If the conveyance is the result of a Change in Route Status Report, a copy of the recorded deed shall be sent to the Transportation Planning Division.

236.5.25 Leases, Licenses 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), License Agreement (RW45) for city monuments on right of way, or Airspace License Agreement (RW28). (Forms RW14, RW28 and RW45 are accessible in eAgreements)

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 Asst. to the State Design Engineer - Right of Way, 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) Review (Form 3.1.2) 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 Asst. to the State Design Engineer - Right of Way 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 Asst. to the State Design Engineer - Right of Way.

236.5.25.4 Marketing Properties for Lease

A marketing venue appropriate to the parcel shall be chosen based on the specific property and its potential lease value. Options include listing the parcel with a real estate broker, in-house marketing, negotiating directly with a Lessee, or a competitive bid process.

In situations where the district elects to solicit bids for potential lease sites and have past experience with a lessee failing to comply with the lease requirements, the district’s solicitation may include the following clause:

“Missouri Highways and Transportation Commission reserves the right to consider the lessee’s actions, inactions, and behavior during prior leases with Missouri Highways and Transportation Commission before awarding the lease. Missouri Highways and Transportation Commission may decline to award the lease to any lessee that failed to pay rent on time or otherwise comply with prior lease requirements. The Missouri Highways and Transportation Commission further reserves the right to request or order a copy of the lessee’s credit report and may consider the lessee’s credit history when deciding whether to award the lease.”

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 shall sign the assessment, if approved. The risk assessment form shall be included with the lease submittal to Central Office when the required insurance is reduced.

236.5.25.6 Security Assessment for Leased Areas Over or Under Highway Structures

When the proposed agreement includes an area under a highway structure or construction of a structure over or under a highway structure, a Highway Structure Security Assessment, Form 236.5.25.6A shall be completed by the district bridge engineer, or district design. The assessment form shall be provided to the Right of Way Section with the lease submittal. Note: For security scores greater than 80, the agreement should not generally be executed.

General guidance for leased areas under highway structures is as follows:

Uses Under MoDOT Bridges
Security Policies
Type of Use Under Bridge	Use Allowed?	Lease/License/Agreement Needed?¹
Public Road	Yes	No
Cattle Passage	Yes	Yes
Bike/Pedestrian/Trail	Yes	Yes
Free Public Parking	Depends²	Yes
Paid Public Parking	Depends²	Yes
Commercial Lease	Depends²	Yes
Farmer's Equipment	Depends²	Yes
Agricultural Products (Hay, etc.)	No	NA
Streetcar	Yes	Yes
Railroad/Rail Yard	Yes	Only if MoDOT was there first.
MoDOT Storage	Nonflammable Only	No
¹ All leases/licenses are subject to min. insurance requirements per EPG 236.5.25.5 Risk Assessment.
² All leases/licenses shall have bridge security assessed per EPG 236.5.25.6.

Additionally, when the lease is intended to allow automobiles or trucks to be driven or parked in an area beneath a highway structure that includes columns supporting the structure, a Bridge Column Protection (auto) Form 236.5.25.6B and/or Bridge Column Protection (truck) Form 236.5.25.6C diagram(s) shall be attached as Exhibit A and/or B and the following shall be added to the lease.

"At Lessee's expense, Lessee will provide and maintain wheel stops (traffic barriers) around Lessor's structural columns located in the leased area. The requirements concerning said wheel stops (traffic barriers) are contained in Exhibit(s) A and/or B, which is attached to this lease agreement and made a part thereof. Lessee will maintain during the term of the lease said wheel stops (traffic barriers) in good condition and appearance. Ownership of the wheel stops (traffic barriers) around the columns of the structure 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) (Form RW14 is accessible in eAgreements) addresses the minimum required provisions for a lease without further review by CCO. Additional stipulations by the Asset Management Committee, the CE, or the Highway Structure 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 as to form 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."

Persons who rent property from the state after it has been acquired, vacated and possession obtained from the occupants who were entitled to the original relocation payments, are not eligible for relocation payments. In all cases, when the department rents or leases improved property (except when a routine "Extension of Possession Agreement" is used) whether it be excess land or right of way, the lease must contain the following clause:

"Lessee agrees that upon surrender of possession he/she will not be entitled to any payment for moving costs or other relocation payments under any State or Federal Relocation Assistance Program."

Leases of Commission property are to be approved and executed by the Asst. to the State Design Engineer - Right of Way.

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. (Forms RW14 and RW28 are accessible in eAgreements). 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/Licenses/Airspace License Agreements Submittals to Right of Way Section

Licenses and 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 Asst. to the State Design Engineer - Right of Way. Non-complex leases, such as those with no form revisions, for appraised value, to the only eligible lessee, do not require prior submittal.

Licenses and 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 as described in EPG 236.5.22 Transaction Submittal to Right of Way Section and should include the following items:

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

2. Asset Management Committee Minutes

3. Current highway plans of the area

4. Highway plans of the area as acquired

5. Appraisal or other valuation documents

6. Categorical Exclusion determination

7. Security Assessment, if applicable

8. Risk Assessment, if applicable

9. Proof of Insurance for the required coverage amount, naming MHTC as an additional insured

10. Copy of the request from leassee/licensee

In addition to these electronic submittals, the original of the agreement executed by the lessee/licensee shall be submitted to Central Office for review and execution.

The Right of Way Section reviews all proposed leases, licenses and airspace license 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 or license is approved, and necessary CCO approval as to form is obtained, and FHWA concurrence is obtained, the Asst. to the State Design Engineer - Right of Way will execute the lease or license. (See the Execution of Documents Policy).

Once approved and executed, the original will be returned to the district. A copy of the insurance certificate shall be collected and uploaded into the RAI. District maintenance should 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 Financial Services Division.

236.5.25.10 Initial Inspection & Annual Inspections

Upon establishment of a lease, license, 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 lessee, or will be remarketed.

After preparation of the new lease, the original agreement executed by the lessee 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, Licenses or Airspace License Agreement

If a lease or license agreement is not renewed, or if either party desires to terminate a lease, license or airspace license 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 should 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 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 the district. 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 Department 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, RW 12 (Form RW12 is accessible in eAgreements) should 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 Asst. to the State Design Engineer - Right of Way must 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).

When an owner or a tenant is granted an extension of possession, a monthly rental rate may 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 (Form RW12 is accessible in eAgreements), the district shall advise the Financial Services Division by letter of such action.

If the Extension of Possession Agreement is being replaced with a Lease of Premises Agreement, it is not necessary to notify the Financial Services Division. The Lease of Premises Agreement is to be submitted to the Right of Way Section with an explanation for execution.

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 Bill of Sale 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 Financial Services 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 the district Financial Services office.

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 Financial Services 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 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 to plug the well in accordance with Statutes 256.600 to 256.640 RSMo.

2. Proceed 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 Design Division's Environmental Section 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.

The district is responsible for working with the Design Division’s Environmental Section to ensure 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) (Form RW12 is accessible in eAgreements), 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.

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 advertising 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 not 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 controlled access highways at the request of district traffic. The deed shall be sent to district traffic, 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 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 Chair or Vice Chair.

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 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.

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. Note: Compensation for non-contiguous entrance shifts and/or widenings where both properties are owned by the same property owner will also be determined from the Valuation Determination Schedule.

2. Noncontiguous Properties

District right of way shall evaluate the property receiving the break in access to determine whether the change in access results in a change to the highest and best use of the property, a change in the level of intensity to the highest and best use of the property, or an enhancement to the highest and best use of the property. . If a change, change in level of intensity, or enhancement to the highest and best use of the subject property has occurred as a result of the access change, district right of way shall cause an appraisal of the property receiving the break in access in the before condition to be completed. Only appraise the area of the development in the event the proposed development is only a portion of the larger parcel. The enhancement value for a full access break will be 15% of the appraised value. The enhancement value for something less than a full access break will be 7% of the appraised value. The applicant will be charged the enhancement value to the property as determined by the percent applied to the appraisal or the amount shown on the Value Determination Schedule, whichever is higher. The district may approve a negotiated amount within 25% of the appraised value. Any amount beyond 25% of the appraised value shall be presented to the Asst. to the State Design Engineer - Right of Way for review and approval.

If the access change does not result in a change, change in the level of intensity, or enhancement to the highest and best use of the subject property, an appraisal will not be prepared, and the amount charged to the applicant will be determined by the Value Determination Schedule. Note: Compensation for non-contiguous entrance shifts and/or widenings where both properties are owned by the same property owner will also be determined from the Valuation Determination Schedule.

3. Break in Access

District right of way shall evaluate the property receiving the break in access to determine whether the change in access results in a change to the highest and best use of the property, a change in the level of intensity to the highest and best use of the property, or an enhancement to the highest and best use of the property. If a change, change in level of intensity, or enhancement to the highest and best use of the subject property has occurred as a result of the access change, district right of way shall cause an appraisal of the property receiving the break in access in the before condition to be completed. Only appraise the area of the development in the event the proposed development is only a portion of the larger parcel. The enhancement value for a full access break will be 15% of the appraised value. The enhancement value for something less than a full access break will be 7% of the appraised value. The applicant will be charged the enhancement value to the property as determined by the percent applied to the appraisal or the amount shown on the Value Determination Schedule, whichever is higher. The district may approve a negotiated amount within 25% of the appraised value. Any amount beyond 25% of the appraised value shall be presented to the Asst. to the State Design Engineer - Right of Way for review and approval.

If the access change does not result in a change, change in the level of intensity, or enhancement to the highest and best use of the subject property, an appraisal will not be prepared, and the amount charged to the applicant will be determined by the Value Determination Schedule.

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.

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 ===236.5.25.4 Marketing Properties for Lease===
 A marketing venue appropriate to the parcel shall be chosen based on the specific property and its potential lease value.  Options include listing the parcel with a real estate broker, in-house marketing, negotiating directly with a Lessee, or a competitive bid process.
+In situations where the district elects to solicit bids for potential lease sites and have past experience with a lessee failing to comply with the lease requirements, the district’s solicitation may include the following clause:
+:“Missouri Highways and Transportation Commission reserves the right to consider the lessee’s actions, inactions, and behavior during prior leases with Missouri Highways and Transportation Commission before awarding the lease.  Missouri Highways and Transportation Commission may decline to award the lease to any lessee that failed to pay rent on time or otherwise comply with prior lease requirements.  The Missouri Highways and Transportation Commission further reserves the right to request or order a copy of the lessee’s credit report and may consider the lessee’s credit history when deciding whether to award the lease.”
 ===236.5.25.5 Risk Assessment===