Tag Archives: relocation assistance

Eminent Domain and What That Means for Your Taxes

Eminent Domain and TaxesAs the tax season begins, it’s a good time to remind you and your clients that relocation payments from federal funded projects that use eminent domain to acquire private property are not considered income, and acquisition payments are treated as a capital gain, which can be deferred by a 1033 exchange.

The Federal Uniform Relocation and Acquisition Act (URA) states that relocation payments are not considered income on a federally funded project. My clients and their tax preparers frequently report weak support regarding this URA statement. Because this frequently causes inconsistent treatment of payments by tax preparers, I’ve been prompted to research the issue, not as a tax person but as a relocation consultant, in order to find support for the tax preparer when dealing with relocation payments, and to assist my clients with relocation planning decisions.

My article, Eminent Domain Acquisition Payments, Relocation Payments, and Taxes, outlines the results of my research in more detail here. See here. Involuntary Conversions.

Once it is understood how to handle the relocation payments, sometimes the next hurdle is to identify relocation payments or separate relocation payments from acquisition payments. This dilemma can occur when a dispute resolution process or trial is used to settle a case where fixtures are included, or when a case is a combination of acquisition and relocation issues. These processes often lump things together making it difficult to identify whether the resulting payment was part of relocation or acquisition. They can also inadvertently limit ongoing relocation benefits.

If you are in the process of preparing for a dispute resolution or trial, I can assist you by preparing language to include in a settlement agreement, preparing clarifying check-sheets, and providing other materials to help identify relocation payments. I can also assist you with preserving rights to ongoing relocation benefits.

Partial Property Taking: Understanding the Impacts

1When a public entity takes partial property through eminent domain, it’s important to understand the impacts and issues to the remaining property. All too often, the public entity’s proposed cure is flawed, frequently eliminating all but a very small portion of the property’s key needs. The property owner must equip him or herself with experts who understand the pitfalls of partial property taking and will look out for their best interest.

In the case of partial property taking, it’s vital to:

  • Understand the property as it exists before the property taking
  • Understand the property taking
  • Understand the zoning and building codes for the area
  • Understand the State’s proposed cure to the remaining property
  • Identify any missing elements of the agency’s proposed cure
  • Prepare a preliminary design and estimated cost to cure the remaining property, if there are shortcomings in the agency’s proposed cure

As a consultant focused on business and property owners impacted by public agencies taking private property through eminent domain, I have an in-depth understanding of these matters. I apply my extensive experience to help identify the property impacts, provide a reasonable design to solve the impacts, and prepare reasonable costs to construct the necessary changes to the property.

My background includes ownership of a business that performed equipment design/build and installation work, as well as ownership in a general contracting firm that constructed commercial projects,including ownership of a steel fabrication and installation business.

Now, I apply that background to my over 15 years as a consultant working with relocating businesses along with preparing preliminary designs and cost estimates to make remaining properties functional after a partial property taking. This work includes the use of guidelines based on the Federal Uniform Relocation and Acquisition Act.

I use the knowledge gained from this background and apply it to assist my clients who are sometimes private property owners, businesses owners, and frequently public agencies. For those clients, I search for problems created by property takings, develop solutions to those problems, develop the costs for those solutions, and provide those costs and designs to the client and/or representatives of the condemning agency.

My work has included several hundred properties, many of which have been complex takings. Here is an example of a recent case. In my role, I reviewed the impacts and issues to the Company X property in the same light and diligence as with all of my typical private and public agency clients.2

Case Study – Company X – Partial Property Taking

Property as it Exists
The property, as it existed, included two shop buildings of 3,600 square feet each, and two tow yards. Each of the buildings and tow yards had ample access for maneuvering towed and dysfunctional vehicles into and out of each area. The attached drawing, Layout Before Property Taking, shows the maneuvering capabilities for each of the key areas and the uses of the property. Also, noted on the drawing are (5) key elements of the property that relate to the current use, as well as, any likely intended users of these buildings and property, such as an automotive repair shop.

The key elements to this property were as follows:

  • Customer parking adjacent to the office
  • Easy tow vehicle access into the buildings
  • Easy tow vehicle access into the storage yards
  • Convenient parking near shop and office areas
  • Convenient shipping and receiving
  • Convenient parking for work on large vehicles

Property Taking
The property taking was along the northern portion of the entire property. The property line prior to the taking was located sixty-five feet north of the north face of the existing building that was used as an auto body shop. Thirty feet of property was being taken, which placed the new property line thirty feet to the south, which is thirty-five feet north of the building. The driveway entrance was also moved thirty feet south.

Improvements within the area of the property taking included a ten-foot landscape buffer, a paved area used for vehicle maneuvering and parking, a pole sign, and a car canopy.

RC Zoning and Parking Design Requirements
An exhaustive search of the codes was not performed, but key items were found and described here. The RC zoning allowed auto body shops as a permitted use. There were approximately thirty-six permitted uses listed of which only a few uses would have been practical at this location. This zoning had requirements for eight-foot wide sidewalks placed in all walk areas including through parking and driveways. Also required were covers over sidewalks at building faces. Wrecked motor vehicle compounds were no longer a permitted use, of which there were two on this property that were allowed due to grandfathering.

Parking in the RC zoning was not allowed on the street side of the building and parking had to meet ADA, stormwater, and landscaping requirements. The quantity of parking stalls calculated to ¾ of a stall per 600 square feet of building square footage. This equated to nine stalls for the 7,200 square feet when combining the two buildings on the site. A designated loading area of ten feet by forty feet was also required.

State’s Proposed Cure
The State’s proposed cure of $67,000 included relocating the existing Tow Yard #1 to the east of the existing Tow Yard #2 to make room on the west side of the building for replacement parking. The state included costs to provide asphalt pavement for the parking, and crushed rock and fencing for the relocated tow yard. The State did not include any design for this work, only a highlighted aerial photo indicating the shape or footprint of the proposed areas (see attached drawing, State’s Proposed Cure).

The State also included a drawing, State’s Tow Vehicle Maneuvering, which indicated that a tow truck could maneuver a vehicle into the body shop for repairs. This was an important item for the existing auto body shop, as it would have also been for an automotive repair shop, which was also a permitted use.

State’s Missing Elements
The State did not consider all of the issues related to installing new parking and relocating the tow yard. The attached drawing, State Proposed Cure Expanded for Codes, was based on the State’s proposed cure, but with the added missing elements that were necessary to meet current codes, which were required when adding the State’s new elements such as parking or crushed rock for the tow yard. The drawing also pointed out other missing elements needed for this property to properly function under the State’s proposed cure.

Relocating the parking or the tow yard required the addition of impervious surfaces such as asphalt or crushed rock. Adding impervious surfaces or simply adding new parking required code upgrades such as landscaping, sidewalks, a dedicated loading area, the proper number of parking stalls, and handicapped stalls with ADA access between the parking and the building entrances. Including these required items, as shown on the drawing, required more space than the State showed on their drawing. Including the required sidewalks and landscaping on the street side of the building reduced the existing driveway and parking to a width of fourteen feet, leaving only enough width for a one-way driveway, which left the building nearly useless for its intended use, and most permitted uses. The State’s proposed cure eliminated all but a very small portion of the property’s key needs.

The tow vehicle maneuvering, as shown on the State’s drawing, failed to meet the State’s intentions, and the needs of the property in two areas. The first problem was that the State did not include the ten-foot landscape buffer in their drawing, which would eliminate the ability to maneuver this vehicle as they had shown. The second problem was that the State’s drawing showed a need for at least a sixteen-foot wide building entrance door to maneuver a vehicle into the building. At the time, the building currently had twelve-foot wide doors; adding any wider doors would have required structural changes to the building, which would have triggered major code upgrades to the entire building. Those code upgrades would likely have caused the building to be demolished and rebuilt new, for economic purposes.

3The State’s suggestion of relocating the tow yard had three fatal flaws:

  1. The first flaw was that the tow yards were grandfathered in and were no longer a permitted use within the RC Zoning, therefore, relocating the tow yard would not have been allowed. Necessary permits would not have been issued, which would have resulted in the loss of one tow yard.
  2. Secondly, creating a solid surface, such as crushed rock suggested by the State, would have triggered other code upgrades to the site including landscaping and likely sidewalks. Either of those items would again have narrowed the driveway that connected to the proposed relocated tow yard, as well as, connecting to the remaining Tow Yard #2, and would have resulted in no access to either tow yards.
  3. Additionally, this driveway narrowing eliminated the ability for truck traffic to pass by the existing septic system, again preventing access to the tow yards.

Adding the code-required elements to the State’s design for curing the remaining property left the design unworkable for making the remaining property functional after the property taking. Tow truck access to the building would have been eliminated, one tow yard would have been eliminated, the other tow yard would not have been accessible, and critical locations for customer parking would have been completely lost.

Attempts to correct or solve these shortcomings of the State’s design proved unattainable because of the remaining narrow driveway, which could not be expanded. Therefore, an alternative design was prepared and discussed in more detail below.

Alternative Design
Alternative to the State’s design and shown on the attached drawing, Alternative Proposed Cure, depicts a design that replaced the minimum needed functions of the remaining property after the property taking. This design took into consideration the RC zoning and the needs and functions for many of the permitted uses listed for the RC zoning.

This design included the removal of the existing Shop #1 and replacement with a new building located to the east. A circular driveway was included of a standard width to allow reasonable traffic flow for all vehicles and combinations of vehicles. Parking was placed in proper locations and in proper quantities. The remaining site was brought up to current codes as required with sidewalks, ADA access, landscaping, and stormwater systems. (This was a preliminary or basic design, in that an exhaustive review for the best design or a design meeting all required codes had not yet been performed.)

The cost for this project was estimated at $1,118,186. The estimate included work and costs from the beginning to the end of the project including, design, permitting, construction, and taxes.  The costs were prepared from preliminary quotes from various local contractors and vendors, as well as with the use of in-house costs from similar projects.

Conclusion
The State’s design was not complete enough to show how it would cure the needed elements for the remaining property after the property taking.
Expanding that design to include the code required items showed that the State’s design did not cure the elements needed for the remaining property to remain functional in its after condition.

The proposed alternative design took into consideration the necessary elements for meeting current codes and included the minimum needed elements for the remaining property to properly function. Based on this alternative design and estimated costs, the cost to cure the remainder property was estimated at $1,118,186.

I created the alternative design and its estimated costs. It was my expert opinion – now justified – of what would be necessary to cure the functions of the remainder property after the property taking.

If you have any questions regarding partial property taking and would like an opinion regarding understanding the impacts, please don’t hesitate to get in touch.

15 Things Guaranteed To Accelerate your Eminent Domain Practice

15 Things Guaranteed To Accelerate your Eminent Domain PracticeBuilding your eminent domain practice and accelerating your firm’s growth is within reach. There are ways to add value and benefit to your clients by augmenting the services that you currently have on offer, helping you and your practice to stand out from the crowd. Including a variety of specialized services will build your business reputation, set you apart from the competition, and quickly accelerate your business. Here are 15 examples that can add value to your practice and start pushing your business forward today:

1. Liaise with an expert who can follow relocation guidelines based on the Uniform Act with intimate knowledge.

2. Avoid client disappointment by adding a seasoned relocation consultation to your client offering. Their expertise will work to guide the process so that your clients are able to avoid much of the potentially extensive out of pocket, non-reimbursable money they would otherwise need to spend to relocate their business because of a public project taking their property.

3. Steer the direction of your clients’ case from an early stage to produce better results to the business/property owner that you’re working with.

4. Perform a thorough analysis to differentiate between personal property and real property. Because federal relocation guidelines don’t automatically guide businesses to the best relocation results, each business relocation should have an analysis performed to make the distinction between personal and real property.

5. Determine the proper amounts and best methods for receiving relocation payments from the public agency while following the relocation guidelines.

6. Make cost-to-cure services a part of your client offering.

7. Add preliminary planning services to your service offering. For those businesses that will be displaced by a project, preplanning can result in thousands and sometimes millions of dollars in cost reimbursements for your clients that often otherwise go unrecognized and unclaimed.

8. Provide services that can be extended to your clients right away to break out of the usual holding pattern. Preplanning services provide you with something to offer the client right away, while other attorneys have to wait to get the ball rolling. This offering will increase the chances of securing the client’s business.

9. Improve efficiency preparing appeals, planning relocation logistics, and orchestrating and coordinating the actual move toward maximum efficiency and minimum client downtime.

10. Increase the amount of time for evaluating and making critical decisions. This can be accomplished through preplanning.

11. Extend replacement property evaluation or feasibility services to your clients to outline the best of the potential replacement properties.

12. Guide your clients through the process of determining relocation benefits that will and will not assist them with making a potential replacement property functional for the business.

13. Pre-plan relocations to establish time for preparation of plans that will minimize downtime with the use of relocation benefits.

14. Save your client out of pocket expenses because of a rushed move, lack of choices, and excessive key employee time spent on the relocation. Proper preplanning sets the stage for the actual relocation, saving your clients thousands of dollars, helping to build your trusted relationship.

15. Put your client’s best foot forward while working with the public agency representatives. Teaming with a preplanning specialist will demonstrate to the public agency your high level of organization and knowledge. With the right preplanning, you can avoid the misinformation that usually causes the process to derail and veer off in a direction that can be costly to your client’s business.

The 15 important items on this list can all be achieved by liaising with a relocation consultant. Including an expert on your team who specializes in the services outlined here can be of extreme benefit to your clients, and certainly to you and the way that you structure your practice. Offering preplanning services to prospective clients creates a more complete package than what other attorneys, appraisers, and other eminent domain professionals offer.

I would be pleased to answer any questions you may have on this matter or other eminent domain and condemnation matters you may want to discuss as they relate to relocation and cost-to-cure. Please contact me either by phone by email. I look forward to hearing from you.

photo credit Twobee via Free Digital Photos

How Eminent Domain Appraisers Can Benefit from “Cost-to-Cure” Services

How Eminent Domain Appraisers Can Benefit from “Cost-to-Cure” ServicesWhen it comes time to defend your appraisal, are you sure that it will stand up to opposing council? Whether it’s your appraisal or your opinion on the replacement costs for buildings and other improvements for cost-to-cure designs and cost estimates, the opposing council will be ready to poke holes in your case.

As an appraiser, sometimes you are working on an eminent domain case where part of a parcel of property is condemned and the use of the remaining property is impacted. In such cases, a consultant can support your work with customized, reasonably calculated cost-to-cure estimates and designs that follow agency guidelines and eminent domain law.

When the new right-of-way severs a structure or improvements, the consultant will develop a design for removing the portions of the improvements affected by the right-of-way, while renovating the remaining portions to cure the damages caused by the property taking.

An experienced cost-to-cure consultant can assist appraisers and other interested parties by enhancing their appraisals for complex structures, improvements, and cost-to-cure values. The cost-to-cure consultant with the added benefit of relocation expertise on eminent domain projects can help in a number of ways by providing a single source and point of contact with expert knowledge in eminent domain issues including cost-to-cure, replacement costs, separation of relocation costs from cost-to-cure and replacement costs, preliminary design, and commercial construction.

Cost-to-Cure Services are Time and Cost Effective

Benefits of Cost-to-Cure estimates and designs for appraisers include:

  • Quick understanding of the assignment and project issues.
  • Efficient turn around of costs and reports.
  • The ability to speak on most of the issues with knowledge of when to hand additional detailed explanations to other experts.
  • Knowledgeable identification of additional experts that may be necessary for the project.
  • Coordination of those experts for the project for their scope of work and reports.
  • Distinguishing between cost-to-cure issues and relocation issues saves time and offers a comprehensive package to the client that includes cost-to-cure needs and relocation needs.
  • Perform analysis of plans and costs developed by the opposing side to determine their effectiveness and reasonableness.

I support appraisers in Eminent Domain cases with timely and affordable cost reports and designs that are, typically, self-supporting.

If challenged, I stand ready to further support and clarify the cost reports in mediation, deposition, or even trial when necessary.  My status as a recognized specialist in this niche comes from an extensive history of creative solutions, credibility and clarity. The documents that I prepare for appraisers are based on defensible fact and stated in detailed but understandable language and also include design drawings that are approachable for the layman.

When you have a difficult or questionable Eminent Domain matter to appraise, please feel free to give me for a free telephone consultation.  I look forward to hearing from you.

Eminent Domain Fact Delivery has Impact on Judge’s Decision

Eminent Domain Fact Delivery has Impact on Judge's DecisionI recently read this article, Caltrans’ Highway 101 Overpass Condemnation Case Ends in a Slip Decision by Brand Kuhn. This is an eminent domain lawsuit that I have been following for several years.

In cases of eminent domain, I can’t stress enough the importance of how the case is presented. The way that the facts are delivered makes a significant impact on the judge’s decision.

As an analogy, eminent domain trials are a lot like the reality competition shows that are so popular on television these days, like The Amazing Race and Dancing With the Stars. Two very talented competing teams go up against one another and apply their knowledge, skills, and resources to put on their best performance. After 20 days of performing – in this case the performance is the trial – the judge or jury scores the two teams based on the performances that they gave.

The scores are the result of how well the story was told while meeting specific criteria and facts in an eminent domain case. Protecting the client’s interests – requires the most compelling case possible; to produce the best results, the value of engaging expert eminent domain representatives to be part of your team to present cannot be underestimated.

Take a moment to read Brad’s article if you have any questions on this matter or other eminent domain and condemnation matters you want to discuss, please let me know.

One Change that could Accelerate your Eminent Domain Law Practice Today

One Change that could Accelerate your Eminent Domain Law Practice TodayTo have long-term success, a business must continue to look for ways to grow. In the sphere of eminent domain law, there is a way that you can set your practice apart from the competition and increase the chances of securing the client’s business. Doing so will accelerate the success of your practice. The change will be able to offer services to your clients right away and move out of the usual holding pattern that usually occurs.

You can extend your reach with new services, and you can make strategic partnerships that can play a significant role in boosting the growth of your practice. Advancing your business can actually be straightforward and only requires one addition to your current practice: the integration of a Business Relocation Consultant as part of your team.

Effective collaboration built on a shared vision and strong purpose will create more worth together than what your entity could produce on its own. A Business Relocation Consultant can work alongside your efforts as part of your eminent domain team and will enable you to offer unique services that will set you apart from the competition. The partnership can bolster your firm’s equity and potential clients will take notice of the added value. Most practitioners do not provide these services, but the benefits to your clients are extensive. A Business Relocation Consultant’s services allow you to form a more complete package to your clients than any other attorney.

Preplanning services can begin right away, breaking the usual holding pattern that’s common in these cases, and the overall outcome of the relocation will usually be improved. Preplanning a business relocation refers to planning before the business has received their notice of eligibility for relocation benefits and before the public agency’s offer has been made on the real property. While following relocation guidelines based on the Uniform Act, preplanning the business relocation and taking appropriate action can result in improved relocation reimbursements received from the displacing public agency, and these amounts are frequently twice or more. The consultant will give a business the opportunity to guide the public agency’s decision-making process as they determine the eligible relocation benefits.

Preplanning differs from relocation planning or Move Planning, as it’s described in the Uniform Act relocation guidelines. Relocation Planning is performed after the business has been determined eligible for relocation benefits by the agency but before the business actually moves.

My 18 years of experience and expertise in preparing relocation costs for reimbursement from displacing public agencies (as high as $34 million) includes preparing appeals, planning relocation logistics, and orchestrating and coordinating the actual move itself toward maximum efficiency and minimum client downtime.

These services are quite unique. This work adds proven value to attorney services and their clients and in many cases, when the business becomes eligible for relocation benefits, my relocation services are eligible for reimbursement within the relocation guidelines.

Partnerships are a great way for any type of business to increase their competitive advantage. In the case of eminent domain law, a partnership can be leveraged to share resources, and increase profitability. By augmenting your professional services to include the expertise of my business relocation consultancy, you can set your practice apart from that of other eminent domain attorneys. If you wish to discuss this further or should you have any questions, or comments, please contact me.

 

Image courtesy of hywards via FreeDigitalPhotos.net

City of St. Louis bid to the National Geospatial-Intelligence Agency: Eminent Domain Recommendations

City of St. Louis bid to the National Geospatial-Intelligence Agency Eminent Domain RecommendationsI have been following the eminent domain case for the City of St. Louis bid to the National Geospatial-Intelligence Agency and have some comments in response to the Paul Berry III Congressional Exploratory Committee statement that was released November 2nd, 2015.

Mr. Berry makes an excellent point of gaining support by the effected property owners and tenants for the NGA project.

To gain that support, I recommend going a few steps further than he suggests. I recommend that the City implement the Federal Uniform Relocation and Acquisition Act (URA). The URA provides guidelines for relocating residents and businesses on federally funded projects and many other projects without federal funding, while using eminent domain to acquire the property.

The URA sets rules and guidelines for the government, as well as for the displaced person to follow, creating fairness and reasonableness for each side during the relocation process. The guidelines make it fairer for the displaced person than many other methods used. However, the URA does not necessarily make the displaced person whole after their relocation, particularly if the guidelines are not properly implemented.

For the City to come closer to this goal of fairness without sacrificing reasonableness and controls, the City could enhance certain parts of the guidelines, as many public agencies and states have successfully done through properly setting up its implementation.

Offering an enhanced version of the URA relocation guidelines for this project will go a long way toward gaining the support of the effected property owners and tenants needed while controlling the process. This would shed a good light of fairness on this project location to enhance the likeliness of the NGA choosing this site.

I am available to assist with recommendations for enhancements to the URA and the proper procedures for its implementation to support Mr. Berry’s recommendation.

Attention Eminent Domain Attorneys: 2 Significant Ways to Build a More Robust Service Offering for your Clients

Attention Eminent Domain Attorneys 2 Significant Ways to Build a More Robust Service Offering for your ClientsThe better that we anticipate the needs of our clients and meet those needs by applying all of the resources available at our disposal, the more successful we – and our clients – will be. There are key ways that an eminent domain attorney can augment their services to better protect the interests of private property and business owners. A more robust service offering will set you apart from other attorneys and demonstrate to your potential clients that you are the best possible attorney to manage their case.

#1 Add Value to your Practice by Including a Business Relocation Consultant on your Team

You can add additional value and benefit to your clients when you team with a business relocation consultant. When brought in early, my services can direct your client along a course that will produce better results and considerable advantage to your clients.

Add expert relocation consultation to your client offering to avoid client disappointment. Consultant services can save your clients significant out of pocket, non-reimbursable money. Federal relocation guidelines don’t automatically guide businesses to the best relocation results. Each business relocation must have some level of analysis performed to distinguish between personal property and real property. It’s essential to determine the proper amounts and best methods for receiving relocation payments from the public agency while following the relocation guidelines.

Preparing appeals, planning relocation logistics, and orchestrating and coordinating the actual move itself toward maximum efficiency and minimum client downtime are examples of how business relocation consultation can add value to your attorney services and your clients.

#2 Enhance your Service Offerings with the Addition of Preplanning Services

You will benefit from offering preplanning services to prospective clients because you will be offering a more complete package than any other attorney. Preplanning services provide you with something to offer the client right away, while other attorneys are in a holding pattern. This offering will increase the chances of securing the client’s business.

Preliminary planning services for vulnerable businesses that are being displaced can result in thousands of dollars in savings and reimbursements for your clients that often otherwise go unclaimed. Preplanning a business relocation while following relocation guidelines based on the Uniform Act can greatly improve the outcome of the relocation. Taking appropriate action can result in improved relocation reimbursements received from the displacing public agency, frequently in amounts of twice or more. In many cases when the business becomes eligible for relocation benefits, the relocation consultation services are eligible for reimbursement within the relocation guidelines.

Preplanning gives a business the opportunity to guide the public agency’s decision-making process as they determine the eligible relocation benefits. Preplanning a business relocation refers to planning before the business has received their notice of eligibility for relocation benefits and before the public agency’s offer has been made on the real property.

Preplanning differs from relocation planning or Move Planning, as it’s described in the Uniform Act relocation guidelines. Relocation Planning is performed after the business has been determined eligible for relocation benefits by the agency but before the business actually moves.

Your extended services will help to ensure fair compensation for your clients’ losses. These services are quite unique within eminent domain industry. By augmenting your professional services to include the expertise of my business relocation consultancy, you can set your practice apart from that of other eminent domain attorneys. If you wish to discuss this further or should you have any questions, or comments, please contact me.

Would You Choose Lump Sum or Actual Cost Relocation Reimbursement?

Under Relocation Guidelines featured on my site by state, business owners who must relocate due to eminent domain can choose to receive benefits from the government agency one of two ways.

1) Lump Sum Payment – up to $40,000 based on income

2) Actual Cost Relocation – based on actual eligible costs, some of which are capped.

Lump Sum Payment

Business owners can receive a lump sum or a fixed payment of up to $40,000 and call it a day.  The business owner will move themselves and no other claims can be submitted to the agency for reimbursement.

So if it costs the business owner $300,000 to relocate machinery, office equipment, parts, furniture for example, along with setting up of computers, telephones, heating and air conditioning, the business owner will pay-out-of-pocket for anything over and above the $40,000 amount.

In this example this amount would be $260,000.

In a cash-strapped economy, any out-of-pocket expenses could make or break a business.

Actual Cost Relocation

The following expenses can be reimbursed to the business owner based on the individual and actual costs of the move.

Moving (no maximum amount with one exception):

1. Transportation of Personal Property

2. Packing, crating, unpacking, uncrating of Personal Property

3. Disconnecting, dismantling, removing, reassembling, and reinstalling equipment, machinery, and other personal property

4. Storage of personal property up to 12 months

5. Insurance for the replacement value of personal property during the move and necessary storage

6. Any license, permit, or certification required at the replacement site, which the business had at the displacement location

7. Replacement value of property lost, stolen, or damaged during the move

8. Professional services for planning, moving, and reinstalling the personal property

9. Re-lettering signs and replacing printed materials made obsolete by the move

  • Stationery
  • Notification of the move

10. Actual direct loss of tangible personal property

11. Reasonable cost incurred trying to sell and item that is not to be relocated

12. Purchase of substitute personal property.

13. Searching for a replacement location (Maximum $2,500)

14. Costs to secure professional move bids

15. Low Value/High Bulk

16. Disposal of personal property and hazardous materials

If a business owner does not opt for the lump sum payment and chooses to be reimbursed via actual costs, there are a few expenses which are capped. My next blog will explain and list these items.

If your company has to move due to eminent domain, which option would you choose? Contact Martyn Daniel, Eminent Domain and Business Relocation Consultant to help you answer that question.