III-1 October 1998
INTRODUCTION
Congratulations! Your sub-grant is approved!
Your State Grant Administrator will send you a sub-grant agreement,
which fully describes the scope of work necessary to implement your
acquisition project. Simply defined, scope of work is what your State
expects you to do to carry out your acquisition project as approved and
funded by the State and the Federal Emergency Management Agency
(FEMA). Adhere to the scope of work, and do no more or no less than
what it requires of you. The agreement also might reference other
documents rather than provide them within the agreement itself. Such
referenced documents carry the same weight as if they were included in
full.
CONTENTS OF THIS PHASE
Phase III guides you through the actual acquisition of properties as well
as management of your sub-grant. It comprises five chapters:
q Chapter 1 ó Before You Do Anything Else. Chapter 1 identifies
your first steps of implementation, ensuring you start out right.
q Chapter 2 ó Set Up Your Sub-Grant Administration System.
Chapter 2 guides you through setting up a documentation filing
system that creates a framework for organizing your project.
q Chapter 3 ó Finish What You Started. Chapter 3 guides you
through preliminary steps (some of which you might have started in
Phase II) that prepare you to acquire properties. This chapter covers
finalizing and enacting all relevant policies and ordinances, developing
and issuing bid packages, and conducting a town meeting to
announce your sub-grant award and explain how the project will
work.
q Chapter 4 ó Acquire Those Properties! Chapter 4 provides a
plan to follow for acquiring properties. Use it as a guide to follow
from your first meeting with a property owner through every step
necessary to reach your goal of newly acquired open space.
Implementation PHASE III
III-2 October 1998
q Chapter 5 ó Conduct Sub-grant Closeout. Chapter 5 helps you
finalize your project activities and prepare your files for audit.
q Part 1 of the Toolkit contains the following tools referred to in this
phase:
n Tool III-1, Allowable and Unallowable Costs
n Tool III-2, Sample Spreadsheet: Tracking the Use of Funds
n Tool III-3, Sample Notice of Relocation Eligibility
n Tool III-4, Sample 90-Day Notice to Vacate
n Tool III-5, Sample 30-Day Notice to Vacate
n Tool III-6, Sample Agenda
n Tool III-7, Sample Presentation Notes
n Tool III-8, Sample Request for Bids
n Tool III-9, Sample Reminder of Appraisal
n Tool III-10, Sample Official DOB Determination Request
q Part 2 of the Toolkit contains the following forms:
n Form III-1, Summary of Property Owner Case Files
n Form III-2, Summary of Tenant Case Files
n Form III-3, Case File Status Chart (Property Owner)
n Form III-4, Communication Log
n Form III-5, Case File Status Chart (Tenant)
n Form III-6, Appointment Sign-up Sheet
n Form III-7, What Should I Bring to My Individual Appointment?
n Form III-8, Monthly Project Status Report
n Form III-9, Quarterly Financial Status Report
PHASE III Implementation
III-3 October 1998
n Form III-10, Meeting Checklist for Property Owners
n Form III-11, Preliminary DOB Research Request
n Form III-12, Meeting Checklist for Tenants
n Form III-13, Project Completion Certificate
Implementation PHASE III
III-4 October 1998
CHAPTER 1 ó BEFORE YOU DO
ANYTHING ELSE . . .
COMPLETE ACTIVITIES FROM PHASE II,
CHAPTER 3
Chapter 3 of Phase II suggests activities you could do to prepare for
receipt of your sub-grant. If you have not yet completed any of those
activities, complete them now. They include:
q Identifying your sub-grant administrator
q Preparing for a town meeting and preparing a press release
q Drafting contracts for services
q Drafting local policies and procedures
CAREFULLY REVIEW YOUR SUB-GRANT
AGREEMENT
Read your entire sub-grant agreement. If you have any questions or
need copies of referenced forms and documents, contact your local
procurement office or your State Grant Administrator. At this stage, your
primary concern is to understand the sub-grant agreement and your
communityís rights and responsibilities. Do not implement your project
until you fully understand your obligations.
PHASE III Implementation
III-5 October 1998
GATHER COPIES OF APPLICABLE
REGULATIONS AND PROCEDURES
The following regulations found in the Code of Federal Regulations
(CFR) are relevant to sub-grant administration:
q 44 CFR, Parts 13, 14, and 206
q 49 CFR, Part 24
Your State also has regulations and procedures covering the administration
of sub-grants. Acquaint yourself with them and keep them on hand
to refer to throughout implementation. If you do not have copies,
contact your State Grant Administrator.
Implementation PHASE III
III-6 October 1998
CHAPTER 2 ó SET UP YOUR
SUB-GRANT ADMINISTRATION
SYSTEM
GOOD IDEA BOX
SET UP YOUR FINANCIAL RECORD-KEEPING
SYSTEM
Because the funds for your sub-grant originate with FEMA, a Federal
agency, you must keep careful financial records. Consult with your
communityís finance or procurement office, or your State Grant Administrator,
for guidance if necessary.
Depending on your communityís financial management system, your
first step is to either establish separate charge codes or open separate
non-interest-bearing checking accounts exclusively for managing your
property acquisition project funds. Keep matching funds (State, local, or
private) separate from FEMA funds.
A good financial record-keeping system has these characteristics:
q Complies with Federal grant management guidelines as dictated by
the Office of Management and Budget (OMB)
Good Idea
If possible, given your communityís existing computer systems,
use electronic spreadsheets and databases to maintain
records. If your community does not already have an
electronic financial management system, consult with your
State Grant Administrator. Your State should be able to
suggest software products or provide guidance on what to
look for in a product.
PHASE III Implementation
III-7 October 1998
q Documents and ìtracksî all funds originating from FEMA
q Documents and ìtracksî all funds and in-kind services received from
matching sources (e.g., State and local match, including Community
Development Block Grants)
q Documents and ìtracksî all monies paid out and the sources of
monies paid out (e.g., Federal or non-Federal share)
q Has internal controls governing the management of funds and
records
q Is regularly audited by an independent auditor
See below for further explanations of these characteristics.
n Complying with OMB guidelines
OMB outlines general principles of allowable costs using Federal funds.
To comply with OMB guidelines, be aware of the following.
Allowable costs
Generally, allowable costs are costs that are:
q Necessary and reasonable for performance and administration of the
sub-grant
q Allocable to the sub-grant
q Authorized or otherwise permitted under State and local laws and
regulations
q Consistently applied as either a project or administrative cost
Refer to Tool III-1, Allowable and Unallowable Costs, for a general
understanding of OMB guidelines. If you have questions about a cost
that is not listed, contact your local procurement office or State Grant
Administrator for guidance.
A community may not spend sub-grant funds on an item that was not
included in its budget or scope of work without prior approval from the
State and FEMA.
Tool III-1
Implementation PHASE III
III-8 October 1998
Allocable costs
Allocable costs are the costs of goods and services necessary to conduct
required sub-grant activities, and, therefore, are properly allocated to
the sub-grant and paid for by sub-grant funds. Your project costs (e.g.,
appraisal, title examination, relocation, and demolition costs, etc.) are
allocable costs.
Reasonable costs
Reasonable costs are practical expenses that any prudent person in
similar circumstances would assume. Expenses are considered reasonable
if they are:
q Ordinary and necessary for the management of sub-grant activities
q Within the confines of Federal, State, and local laws and regulations
q Based on market prices for comparable goods and services
Direct versus administrative costs
q Direct costs are project costs allocable to a specific cost objective.
Your project costs are direct costs.
q Administrative costs are the general costs to the community to
coordinate the project and meet Federal reporting and record-keeping
requirements.
Cost overrun and underrun
q A cost overrun is an unanticipated increase in the total cost of the
project.
q A cost underrun is an unanticipated decrease in the total cost of the
project.
A cost overrun or underrun often is the result of the difference between
an estimated cost and an actual cost.
Change in scope
A change in scope often results in a change of cost. Only your State,
with FEMAís approval, can authorize changes in scope and any associ-
PHASE III Implementation
III-9 October 1998
ated changes in costs. Immediately notify your State Grant Administrator
if a change in scope might occur. Do not perform any activities that
change the scope of your sub-grant without the expressed, written
approval of your State Grant Administrator.
Program income
Your acquisition project might generate program income before you
closeout your sub-grant. Program income can result from the sale of
salvage or the lease of acquired property. Unless the State directs otherwise,
any income generated before the sub-grant period ends must be
used to defray the overall costs of the project. This in turn will reduce
the total sub-grant funding.
For example, if the total cost estimate for a project is $12,000, but
salvage is sold for $2,000 before sub-grant closeout, that $2,000 is
program income. Consequently, total cost for the project would be
$10,000 ($12,000 minus $2,000). Therefore, the Federal share for this
project would be no more than 75 percent of $10,000, or $7,500. The
community would be responsible for at least 25 percent, or $2,500.
Once the sub-grant is closed out, any income generated by the property
belongs to the community as titleholder.
n Documenting and tracking project funds
Ensure that your financial management system can document and track
all the funds you acquire and spend for your property acquisition
project. Make sure that your system allows you to track FEMA funds
separately from local match funds. At project closeout you must document
that non-Federal funds were used to pay for at least 25 percent of
the total project cost.
To best track project funds, keep separate charge codes or non-interestbearing
checking accounts for FEMA and matching funds. Every time
you deposit or withdraw from one of these accounts, document it on a
spreadsheet or some other type of log. For deposits, track the sources of
the funds, means in which they were provided (cash, check, etc.), and
dates they will be available. For withdrawals, track the sources of funds;
Implementation PHASE III
III-10 October 1998
to whom and why they were disbursed; dates of payment; and check
numbers. Also document the value of in-kind services. A sample spreadsheet
that tracks funds can be found in the Toolkit (Tool III-2).
n Managing funds and records
Establish internal controls for managing funds and records. For guidance,
consult with your communityís finance or procurement office, or
your State Grant Administrator. Internal controls usually begin by limiting
access to funds and financial records to only a few authorized
individuals.
n Auditing
The Federal Government requires having project funds regularly audited
by an independent auditor. Such audits also are in your best interest.
Consider asking the Certified Public Accountant who completes your
yearly or bi-yearly audits to audit your property acquisition funds in
accordance with the Single Audit Act. Depending on the size of your
community and the amount of Federal funds received, use the following
Federal guidelines as the minimum audit requirements:
q If you expend $300,000 or more in Federal funds in any 1 fiscal
year, you must have a single audit completed.
q If you receive between $25,000 and $300,000 in Federal funds in
any 1 fiscal year, and choose not to have a citywide or county wide
single audit, you must conduct individual grant audits.
q If you receive less than $25,000 in Federal funds in any 1 fiscal year,
you are exempt from complying with Federal audit requirements.
However, you are still subject to State and local auditing requirements.
Tool III-2
PHASE III Implementation
III-11 October 1998
SET UP YOUR PROPERTY ACQUISITION
PROJECT FILING SYSTEM
GOOD IDEA BOX
n Sub-grant file contents
Keep the following in your sub-grant file:
q Sub-grant agreement and any amendments to it
q Financial records including copies of each quarterly financial status
report and all funds documentation and tracking
q Commitment letters (from non Federal sources)
q Schedule depicting estimated and actual milestones
q Copies of reports
q Correspondence with your State
q Property site inventory as updated from your sub-grant application,
identifying properties actually being acquired
q Summary of property owner case files including the following information
about each:
n Property owner name
n Property address
n Fair market value (FMV)
n Duplication of benefit (DOB) deduction
n Purchase price (FMV less DOB deductions)
Good Idea
Use classification folders that are divided into several sections
to organize your documents within each file.
Implementation PHASE III
III-12 October 1998
n Case file contents log (to be checked off as completed for each
property)
1. Statement of Voluntary Participation
2. Affidavit
3. Determination of value (e.g., preliminary assessment and
final appraisal)
4. Income Status Worksheet (if applicable)
5. Offer Letter
6. DOB settlement sheet, provided by FEMA, and copies of
receipts for repairs
7. Proof of ownership and a copy of title insurance policy
provided by the title company
8. Deed with restrictive covenants (or easement with restrictive
covenants)
9. Closing statement, provided by title company
10. Copy of each check written per the closing statement
11. Verification of relocation or demolition
A sample Summary of Property Owner Case Files is provided in the
Toolkit (Form III-1).
q Summary of tenant case files including the following information
about each:
n Tenant name
n Property address
n Case file contents log (to be checked off as completed for each
tenant)
1. Letter of preliminary notification
2. Letter of relocation assistance eligibility
Form III-1
PHASE III Implementation
III-13 October 1998
3. 90-day notice to vacate, if applicable
4. 30-day notice to vacate, if applicable
5. Income Status Worksheet, if applicable
6. Tenant Relocation Assistance Application and Worksheet
7. Receipts
8. Copy of each relocation assistance check written
A sample Summary of Tenant Case Files is provided in the Toolkit
(Form III-2).
q Contractor file(s) contents:
n Contracts
n Invoices
n Copies of checks or other payment documentation
n Correspondence
n Other
n Property owner case file contents
Set up a file folder for each eligible property owner. Keep a Property
Owner Status Chart and a Communication Log inside the front cover.
Summarize the communication every time a project team member
meets with or speaks to a property owner. A sample Case File Status
Chart for property owners and a sample Communication Log can be
found in your Toolkit (Forms III-3 and III-4). By closing, each property
owner case file should contain:
q Offer Letter. (See Form II-8). For each property owner, prepare a
letter signed by a community official that states the determined value
of the property and instructions to the owners for conducting negotiations.
Form III-2
Forms III-3 & III-4
Implementation PHASE III
III-14 October 1998
q Determination of value (preliminary and final). The preliminary
determination is the value of the property as identified on your
application. The final determination is the price your community is
willing to pay for the property, which you attach to the offer letter.
(See Form II-8.) The final determination of value is the FMV, as
determined by a State-certified or -licensed professional appraiser,
less any DOB.
q Statement of Voluntary Transaction. (See Form II-9). Each owner must
sign a statement indicating that he or she understands the buyout
program is voluntary and he or she can decline to sell at any time
prior to closing.
q Affidavit. (See Form II-10). Each property owner must sign a statement
disclosing all Federal disaster assistance benefits received in
conjunction with the event leading to this property acquisition.
q Proof of DOB (settlement sheet provided by State). The settlement
sheet identifies any DOB that must be deducted from the FMV and
any payments due to the U. S. Small Business Administration (SBA)
at closing. Attach copies of receipts for repairs to the settlement
sheet.
q Proof of ownership. The title company conducting the title search
should provide a letter indicating who the legal owner(s) is, if any
outstanding liens exist, copy of title insurance policy, etc.
q Deed with restrictive covenants (or easement with restrictive covenants).
Each deed filed by the community for the purchase of
property using FEMA or matching funds must include the restrictive
covenants discussed in Phase II (Forms II-11 and II-12).
q Closing statement. The real-estate attorney should provide a copy of
the closing statement indicating the flow of funds from the market
value price to the proceeds the owner received.
q Copies of checks. Keep a copy of each check written to the property
owner as verification that he or she was paid in accordance with the
closing statement.
PHASE III Implementation
III-15 October 1998
q Verification of relocation or demolition. The best evidence is a
picture of the vacant lot with either an invoice from the demolition
contractor marked ìpaid in fullî or a copy of the check written to
the contractor.
Also include other items, such as questionnaires, correspondence,
appeals, special approvals, and State-specific documentation in the case
file.
n Tenant case file contents
As with each property owner, set up a file folder for each eligible tenant
and maintain a Case File Status Chart and a Communication Log. A
sample Case File Status chart for tenants is included in the Toolkit (Form
III-5). By closing, each tenant case file should contain:
q Letter of Notification (see Tool II-3). As soon as you notify property
owners that their properties are eligible for acquisition, notify any
tenants of those properties that the property might be sold and advise
them of their rights, responsibilities, and options. Keep a copy of the
letter and proof of delivery in the case file.
q Notice of relocation eligibility. (See Tool III-3 for a sample.) This
notice informs tenants that their landlord has accepted an offer to
sell their home and, consequently, they are now eligible for relocation
assistance benefits. Keep a copy of the letter and proof of
delivery in the case file.
q 90-day notice to vacate. (See Tool III-4 for a sample.) Send a 90-day
notice to vacate to any tenant still residing in a property being
acquired immediately after the property owner accepts the
communityís offer to purchase (the same day if possible). Keep a
copy of the letter and proof of delivery in the case file.
q 30-day notice to vacate (See Tool III-5 for a sample). Send a 30-day
notice to vacate to tenants as applicable. Keep a copy of the letter
and proof of delivery in the case file.
Tool III-3
Tool III-4
Tool III-5
Implementation PHASE III
III-16 October 1998
q Tenant Relocation Assistance Application and Worksheet. (See Form
II-13.) This application/worksheet, to be completed at the tenantís
individual appointment, determines whether the tenant is eligible for
relocation benefits and, if so, how much. Give the tenant a copy
and keep a copy of the completed application/worksheet in the
tenant case file.
q Receipts. Tenants must submit proof of moving expenses and decent,
safe, and sanitary replacement housing. Proof can take the form of
receipts from a moving company, copies of utility bills, copies of
leases, etc.
q Copies of checks issued. Keep a copy of each check written for
relocation or moving assistance.
Also include other items, such as questionnaires, copies of correspondence,
appeals, special approvals, and State-specific documentation.
BUDGET YOUR ADMINISTRATIVE COSTS
n Determine your eligible amount.
The total amount of your sub-grant determines the total amount you will
receive for administrative costs. Determine your administrative funding
as follows:
q For the first $100,000 of the sub-grant award, budget 3 percent (.03)
q For the next $900,000, budget 2 percent (.02)
q For the next $4,000,000, budget 1 percent (.01)
q For any amount over $5,000,000, budget ½ percent (.005)
PHASE III Implementation
III-17 October 1998
For example, if you are awarded a $500,000 sub-grant, budget your
administrative costs as follows:
PROJCOSTS1.EPS
The total allowable administrative cost using FEMA funds is $11,000.
If you are awarded $6,000,000, budget your administrative cost as
follows:
PROJCOSTS2.EPS
The total allowable administrative cost using FEMA funds is $66,000.
s t s o C t c e j o rP el a c S
e v i t a r t s i n i m d A
s t s o C
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0 0 0 , 0 0 4 $ ) 0 0 0 , 0 0 1 $ - 0 0 0 , 0 0 5 $( 20 . X 0 0 0 , 0 0 4$ 00 0 , 8 $
0 10 . X 0$ 0$
0 50 0 . X 0$ 0$
s t s o C e v i t a r t s i n i m d A l a t oT 00 0 , 1 1 $
s t s o C t c e j o rP el a c S
e v i t a r t s i n i m d A
s t s o C
0 0 0 , 0 0 0 , 6$ 30 . x 0 0 0 , 0 0 1$ 00 0 , 3 $
0 0 0 , 0 0 9 , 5 $ ) 0 0 0 , 0 0 1 $ ñ 0 0 0 , 0 0 0 , 6 $( 20 . x 0 0 0 , 0 0 9$ 00 0 , 8 1 $
0 0 0 , 0 0 0 , 4 $ ) 0 0 0 , 0 0 9 $ - 0 0 0 , 0 0 9 , 5 $( 10 . X 0 0 0 , 0 0 0 , 4$ 00 0 , 0 4 $
0 0 0 , 0 0 0 , 1 $ ) 0 0 0 , 0 0 0 , 4 $ - 0 0 0 , 0 0 0 , 5 $( 50 0 . X 0 0 0 , 0 0 0 , 1$ 00 0 , 5 $
s t s o C e v i t a r t s i n i m d A l a t oT 00 0 , 6 6 $
Implementation PHASE III
III-18 October 1998
n Document and track all administrative expenses.
Tracking and documenting your administrative expenses are good
accounting practices. Forms of documentation include:
q Timesheets and either copies of payroll checks or payroll receipts
q Receipts for supplies and equipment purchased, and either copies of
checks or other payment documentation
q Inventory of equipment, and either copies of checks or other payment
documentation
PHASE III Implementation
III-19 October 1998
CHAPTER 3 ó FINISH WHAT
YOU STARTED
IMPLEMENT POLICIES & PROCEDURES
Now that you have actual sub-grant funding, you might need to revise
your draft policies and procedures. Also, determine whether all property
owners who originally signed up still want to participate. Discuss any
potential changes to your project as it is identified in your sub-grant
with your State Grant Administrator. Do not implement any changes to
your project without first seeking approval from your State. Then,
finalize your draft policies and procedures, develop any necessary
ordinances and resolutions, and submit all documents to your State for
approval.
Once your State approves your policies, procedures, etc. implement
them as you would any other. Do not begin your property acquisition
project before you have enacted all policies, procedures, etc. that will
affect the project. Publicize those policies, procedures, etc. and ensure
that all participating property owners, tenants, and others who might be
directly affected are aware of them.
SUBMIT PRESS RELEASE & CONDUCT TOWN
MEETING
n Prepare to conduct a town meeting.
The purpose of this meeting is threefold: announce award of the subgrant;
explain policies, procedures, etc. governing the property acquisition
project; and begin acquisition proceedings.
You might have started preparing for this town meeting as suggested in
Phase II. If you have not yet begun preparing for this town meeting, do
Implementation PHASE III
III-20 October 1998
so now. Refer to the Town Meeting Checklist (Tool I-4). In addition to
completing the checklist:
q Update/finalize milestones. Now that you have been awarded a subgrant
and are prepared to begin your property acquisition project,
adjust your time line and milestones to reflect the current date,
resources, and expected participants.
q Establish blocks of time for individual appointments with property
owners. After this town meeting, the community will begin negotiations
with property owners. Since details of the negotiations are
specific to each property owner, meeting with them individually
allows the project team to more easily resolve questions and concerns,
ensure understanding of responsibilities, and obtain property
owners signatures on all necessary documents. Select blocks of time
when project team members are available and plan to have ìsignupî
sheets at the town meeting so property owners can schedule
appointments.
q Develop ìsign upî sheets for property owner appointments. Plan
approximately one hour for each appointment. Be sure that the time,
date, location, and name of the project team member who is conducting
the meeting are all clearly marked on each sign-up sheet. A
sample sign-up sheet is provided as Form III-6.
q Anticipate individual appointments with tenants. Explain that you
will notify each tenant to schedule an individual appointment as you
conclude negotiations with the rental propertyís owner. During the
appointment, answer the tenantís questions, address the tenantís
concerns, and help the tenant complete a relocation assistance
application.
Form III-6
PHASE III Implementation
III-21 October 1998
GOOD IDEAS BOX
n Conduct town meeting.
During this town meeting:
q Announce award of the sub-grant
q Explain and provide copies of policies, procedures, etc. regarding:
n Property acquisition criteria
n Fair market value (FMV)
n Appraisals
n Property taxes
n Amount of acreage per property to be acquired
n Relocation
n Demolition
Good Ideas
1 Make evening and/or weekend appointments available
for property owners and tenants who cannot meet during
the day.
2 If your community is acquiring many properties and will
have many individual meetings, use pre-printed, bound
calendars with hourly appointment slots as sign-up sheets.
Provide one calendar for each project team member who
will be conducting meetings.
3 If possible, assign project team members to meet with
either property owners or tenants, not both. They will
be better able to focus on the issues concerning their
audience and will develop extensive knowledge of their
part of the process more quickly.
Implementation PHASE III
III-22 October 1998
n Salvage (what the owner may and may not remove from the
property)
n Vacating property
n Mobile homes
n Tenants
n Appeal process
q Explain milestones. Make the property owners and tenants aware of
project goals. Understanding the overall time line and knowing
certain milestones clarify how their responsibilities affect the rest of
the project, and encourage treating deadlines seriously. Also, emphasize
all tasks that must be completed before any buyout checks will
be issued, and solicit their support.
q Review the voluntary nature of acquisition. Remind property owners
that participation in the property acquisition project is voluntary, and
all participants can withdraw from participation at any time up until
closing. Also remind them that, since they are choosing to sell their
homes, they are ineligible for relocation assistance. (See Tool I-7.)
q Review property ownersí obligations. Re-emphasize that the property
ownersí full cooperation and participation will help the process
move more quickly and smoothly. (See Tool I-7.)
q Duplication of benefits (DOB). Remind property owners that certain
funds from other sources, such as some disaster assistance and
insurance will be counted toward the purchase price of their home
unless they can document that the money was spent on approved
home repairs. Emphasize the importance of retaining all receipts and
disclosing all previously collected benefits. Bring copies of fact
sheets distributed during the town meeting in Phase II to distribute as
necessary. (See Forms II-2, II-3, and II-4.)
q Request that property owners sign up for appointments. Explain that
the project team would like to meet individually with each eligible
property owner and tenant to address individual concerns and
complete necessary forms. Distribute Form III-7 (What Should I Bring
to My Appointment?) and copies of the following items to property
Form III-7
PHASE III Implementation
III-23 October 1998
owners and tenants, as appropriate. They will be completed and
signed during appointments.
n Statement of Voluntary Participation
n Affidavit
n Income Status Worksheet (if applicable)
n Tenant Assistance Application and Worksheet
q Compile minutes. Designate a recorder to compile the minutes of
the meeting.
The Toolkit contains a Sample Agenda (Tool III-6) and Sample Presentation
Notes (Tool III-7).
PROCURE NECESSARY SERVICES
SPECIAL NOTE BOX
n Develop bid packages.
The bid package is a bidderís main source of information about the
communityís wants and needs. Finalize any draft specifications you
have started, revising them per your sub-grant as necessary, and submit
them to your State for approval. Include the final bid specifications
Special Note
To comply with FEMAís requirements, your State will not
approve percentage-of-cost contracts, or any contract
where payment for work is contingent on Federal reimbursement.
Any work performed under either type of contract
will be ineligible for Federal and State funding. Firm-fixedprice,
and time and material contracts genererally are acceptable.
Tools III-6 & III-7
Implementation PHASE III
III-24 October 1998
(after they have been approved by your State), any standard bidding
forms (if applicable), and any supplemental information helpful to
bidders in the final bid package. Be sure to include the date and time
bids are due.
n Issue bid packages.
Make the full bid packages available at a central location for review by
prospective bidders. Advertise the request for bids in local newspapers,
on community bulletin boards, and through announcements at local
professional association meetings. A sample Request for Bids can be
found in the Toolkit (Tool III-8).
GOOD IDEA BOX
CASE STUDY: MINNESOTA BOX
Good Idea
Consider allowing prospective bidders to photocopy the bid
package, or providing a photocopy of the package for a small
fee that is returned upon receipt of a bid.
How One State Did It:
The State of Minnesota
The State of Minnesota requires that sub-grantees give preference,
to the extent practical, to local organizations, firms, and individuals.
The State encourages local contracting officers to advertise in the
local area, subdivide large projects into smaller contracts when
feasible to increase the likelihood of finding a qualified local
contractor, and stress in the bid announcement and package that
contractors who purchase resoures and hire employees from the
mitigaiton project area will receive first priority.
Tool III-8
PHASE III Implementation
III-25 October 1998
n Evaluate bids received.
Open the bids on the date and at the time announced in the bid package
and request for bids. You should accept the lowest, technically
acceptable bid. However, you may reserve the right to evaluate the bids
more carefully before entering into a contract. If you choose to accept a
bid other than the lowest one, you must justify your choice. Check with
your local procurement office or State Grant Administrator.
n Award contracts to successful bidders.
Once a bid is selected, create a file for the contractor and award the
contract. Keep a copy of the contract and all invoices in the contractorís
file. Also keep a list of all bidders with proof that the project was given
to the lowest bidder or justification why it was not.
Implementation PHASE III
III-26 October 1998
CHAPTER 4 ó ACQUIRE THOSE
PROPERTIES!
GENERAL NOTE BOX
MEET WITH PROPERTY OWNER
n Confirm appointments with property owners.
Depending on the number of properties you plan to acquire, you might
schedule appointments up to six weeks or more in advance. Since much
of your community will be focused on rebuilding, some people are
likely to forget their appointments, especially those that are weeks away.
Therefore, call and/or send a reminder letter to confirm appointments.
n Follow up with eligible property owners who did not sign
up at the town meeting.
Participation in a property acquisition project is often mutually beneficial
for the community and the property owner; encourage everyone
who is eligible to participate. If some people did not attend or sign up
for an appointment at a town meeting, investigate the situation. Elderly
or physically challenged people might not have signed up simply due to
problems with transportation; others might be concerned about finding
replacement housing. If the project team can help resolve their concerns
(such as by providing transportation or meeting at the property ownerís
home, helping them find housing), the property owners might be more
than willing to participate.
General Note
You are required to submit periodic reports of the status
of your project and funds you have expended. If your State
does not have forms to provide to you, use the Monthly
Project Status Report (Form III-8) and Quarterly Financial
Status Report (Form III-9) provided in the Toolkit.
Forms III-8 & III-9
PHASE III Implementation
III-27 October 1998
n Conduct meeting with individual owners.
The purpose of the meeting is to ensure that each property owner
understands all policies and restrictions that affect the acquisition of his
or her property, and to collect any missing data. The more you verify at
this meeting, the more likely your documents will be complete and
accurate, and your property owners will be satisfied. The Toolkit contains
a checklist (Form III-10) to help you prepare for and conduct the
meeting. During the meeting:
q Ensure property owner understands property acquisition in general,
duplication of benefits (DOB), and all community policies and
procedures.
q Confirm information previously gathered.
q Obtain property ownerís signature on Statement of Voluntary Participation
and Affidavit.
q Ensure property owner correctly completes an Income Status Worksheet
(if applicable).
q Collect receipts and attach them to the Affidavit.
q Schedule the appraisal and ensure property owner understands the
communityís policy regarding second appraisals.
q Request the property owner to complete and return the hazardous
materials property survey (Form II-14) by the required date. Provide
a self-addressed, stamped envelope. Emphasize the date the completed
survey is due back to you.
When you are finished, remember to document your meeting in the
property ownerís case file.
n Follow up with individual property owners.
q Remind property owner of scheduled appraisal 24 to 48 hours
beforehand. A sample reminder letter can be found in the Toolkit
(Tool III-9). Tool III-9
Implementation PHASE III
III-28 October 1998
q Remind property owner to return hazardous materials property
survey, as necessary.
q Meet with property owner to discuss the completed hazardous
materials property survey and abatement of hazardous materials, as
necessary.
CONDUCT TITLE SEARCH & APPRAISAL
Conduct a title search for each property to ensure that:
q The owner selling the property is also the titleholder
q The title is clear at the time of sale and has no mortgages, outstanding
liens, incompatible easements, or other encumbrances to the
property
Also have the property appraised by an independent appraiser to determine
the fair market value (FMV). Use this appraisal, subtracting any
DOB, to determine the purchase price offered to the property owner.
DETERMINE DUPLICATION OF BENEFITS
n Develop and submit preliminary DOB research request.
Develop a Preliminary DOB Research Request form with the following
information:
q Property owner name
q FEMA control number or Social Security Number if FEMA control
number is not available
q Address of damaged property
q Telephone number (both day and evening) where property owner
currently can be reached
PHASE III Implementation
III-29 October 1998
q National Flood Insurance Policy (NFIP) policy number
q Five-digit NFIP company code
q Insurance agentís name and telephone number
q Indication whether any repairs have been made
Submit the completed form to your State. Your State and FEMA will use
this information to begin compiling DOB determinations for your property
owners. However, they will not send you an official DOB settlement
sheet for any property owner without an official determination
request. A sample Preliminary DOB Research Request form is provided
in the Toolkit (Form III-11).
n Submit request for official DOB determination.
When closing on a group of properties, compile any new DOB data for
those properties and submit an official letter of request for determination
for those specific properties to your State. The official DOB determination
request should follow these guidelines:
q Use official community letterhead signed by an authorized agent. (If
the agent is a private contractor hired to oversee the closing, enclose
a letter signed by a community official granting the agent authority.)
q Include the following or similar disclaimer: ìThe disaster assistance
award information will be used only for the purpose of avoiding
duplication of benefits for a property acquisition project.î
q For each property to be acquired and listed on the Preliminary DOB
Research Request form identify the FMV as agreed to by the property
owner. (This value should be the result of the appraisal and any
negotiations with the property owner.)
q For each property owner, enclose a signed Affidavit with attached
receipts.
A sample official DOB determination request can be found in the
Toolkit (Tool III-10).
Form III-11
Tool III-10
Implementation PHASE III
III-30 October 1998
n Obtain DOB settlement sheets.
Your State will provide a settlement sheet for each property owner. The
Settlement Sheet identifies all deductions and credits applicable to the
purchase price. The property owner must sign the settlement sheet at
closing. Closing cannot proceed until all claims have been settled.
MAKE OFFER TO PROPERTY OWNER
Using information from the DOB settlement sheet and appraisal, finalize
an offer letter for each property owner. The offer letter should include:
q A purchase price for clear title to the property
q A determination of compensation
q A statement that the acquisition is voluntary
q An explanation of the property ownerís right to appeal
n Distribute notice of relocation eligibility to tenants.
If you make an offer to the owner of a rental property, immediately
notify the tenants of that property that they might be eligible for relocation
assistance. If possible, send notices of relocation eligibility to
tenants (see Tool III-3) the same day you send the offer letter to the
owner.
GOOD IDEA BOX Good Idea
Send offer letters by certified mail or some other secured
means that provides tracking and proof of delivery. Also maintain
proof of delivery records for each property owner.
PHASE III Implementation
III-31 October 1998
PROPERTY OWNER ACCEPTS OFFER
At this point, the property owner must decide whether or not to sell his
or her property for the purchase price the community has offered. If the
owner accepts the communityís offer, proceed. If the owner rejects the
offer and wishes to terminate negotiations, stop closing proceedings on
that property. If the owner submits an appeal, stop closing proceedings
pending the resolution of the appeal.
n Follow up with property owners, as necessary.
Remember to contact property owners with the answers to any questions
you could not answer at the individual meeting. Also, schedule a
time to inspect the property. Encourage them to attend the inspection to
review the property and answer any questions.
n Inspect property.
When the offer letter has been executed, inspect the property to:
q Ensure hazardous materials per the Hazardous Material Property
Survey/ Individual Property Survey Form have been abated
q Ensure fixtures included in the appraisal have not been removed
n Finalize deed (or easement) restrictive covenants.
Per the assurances on your application, all deeds or easements must
place permanent restrictions on the property (see Form II-11). Restrictions
include:
q The property shall be dedicated and maintained in perpetuity for
uses compatible with open space, recreational or wetlands management
practices
q No structures shall be built on the property unless they are public
facilities, functionally related to open space usage, wet
floodproofed, and open on all sides or are rest rooms
q No future Federal disaster assistance in any form will be sought or
given with respect to the property
Implementation PHASE III
III-32 October 1998
n Distribute a 90-day Notice to Vacate to tenants and
schedule an appointment.
As soon as a property owner accepts the communityís offer to purchase
a rental property, any tenants of that property automatically become
eligible for relocation assistance. Immediately notify the tenant of his or
her eligibility and request to schedule an individual appointment to
complete a Tenant Relocation Assistance Application and Worksheet.
Also, issue the tenant a 90-day notice to vacate.
Timing for the 90-day notice is essential because the tenant must move
early enough for the community to demolish the structure before the
end of the 90-day period after closing. Properties should be vacant by
closing. Allowing owners or tenants to remain on the property after
closing can cause serious problems; avoid those problems by ensuring
properties are vacant before the closing.
n Meet with each tenant.
The purpose of this meeting is to ensure that tenants understand all
policies and restrictions that affect their relocation eligibility and benefits,
collect any missing data, and complete the Tenant Relocation
Assistance Application and Worksheet. The more you verify in this
meeting, the more likely your documents will be complete and accurate,
and the faster you can provide assistance funds and help the tenant
move. Included in the Toolkit is a checklist (Form III-12) to help you
prepare for and conduct this meeting.
GOOD IDEA BOX
Good Idea
Consider ordering and distributing copies of U. S. Department
of Transportation publication No. FHWA-PD-95-010,
ìYour Rights and Benefits as a Displaced Person,î to tenants
affected by the property acquisition project. This publication,
intended for public distribution, helps tenants understand
their rights and responsibilities with regard to relocation
benefits under the Uniform Relocation Assistance and
Real Property Acquisition Policies Act.
PHASE III Implementation
III-33 October 1998
REQUEST FUNDS FROM STATE
Once several offers have been accepted but prior to closing, request
funds from your State in the total amount necessary to pay those owners.
Generally, States disburse funds on a regular schedule, so adhere to
that schedule and conduct closings accordingly. A few days after submitting
your request, call to ensure the State received it and ask when
you can expect to receive the funds.
n Schedule closing.
Schedule the closing only after you are sure the funds will be available
to disburse to the property owner. If the community has the funds to
cover payment before receiving grant funds from the State, then schedule
the closing at a time convenient to the property owner and the
community representative. But if the community is relying on grant
funds to cover the acquisition payment, wait until the State forwards
payment before scheduling the closing.
When scheduling the closing, also consider when the property will be
vacated. Schedule the closing when the property will be vacant by the
closing date or soon thereafter, according to community policy.
n Distribute 30-day Notice to Vacate.
Mail, or otherwise distribute, a 30-day Notice to Vacate to tenants, as
appropriate.
CONDUCT CLOSING
The community pays the fair and reasonable costs normally associated
with a real-estate closing, including costs of title transfer, recording fees,
transfer taxes, and evidence of title and legal description. The property
owner is responsible for recording fees necessary to clear existing
mortgages, liens and encumbrances from the deed, as well as past or
present property taxes.
Implementation PHASE III
III-34 October 1998
Also during the closing, obtain final evidence of title showing the
community as owner of the property, including documentation of a
recording with the county recorder of deeds. This, along with the
following documents, should be added to each property owner case
file: a final title insurance policy that insures the community has free
and clear title to the property, a recorded warranty deed, and copies of
all disbursement checks.
CLEAR AND INSPECT LAND
After the property is vacated:
q Relocate structures, as applicable
q Take possession of keys to remaining structures
q Secure remaining structures (i.e., lock and board windows, and lock
doors)
q Disconnect electricity and gas
q Turn off water and other utilities
q Post signs (e.g., ìNo trespassing by order of _. Violators will be
prosecuted to the fullest extent of the law.î)
q Demolish remaining structures as soon as possible, but no later than
90 days after closing
q Inspect cleared land
Congratulations! You have done it! You have successfully removed
people from harmís way, and reduced the financial and emotional costs
of a future disaster. You also have created open space that your community
can now enjoy in any number of ways. Phase IV ó Open Space
Management will help you make your open space vision a reality.
PHASE III Implementation
III-35 October 1998
CHAPTER 5 ó CONDUCT
SUB-GRANT CLOSEOUT
If you have maintained good files, managed your finances properly, and
kept your State Grant Administrator appraised of changes, you have
already taken the first steps toward sub-grant closeout. Sub-grant closeout
is the process of officially ìclosing the booksî on your communityís
property acquisition project. Closing out a sub-grant does not affect
FEMAís right to disallow costs and recover funds on the basis of a later
audit or review, or your communityís obligation to return any funds due
as a result of later refunds, corrections, or other transactions.
Specific procedures might vary in your State, but generally to closeout a
sub-grant:
q Submit a final Monthly Project Status Report and Quarterly Financial
Status Report. Clearly mark them as final.
q Request final funds, if applicable. Request any administrative funds
that have not yet been disbursed. If you still have to complete the
last of the property closings, or have just completed the final ones,
you also might need to request final project funds.
q Make all final payments to property owners, contractors, and vendors.
q Return unused funds to your State, if applicable.
q Submit a Certification of Completion once all costs have been paid
and unused funds returned. If your State does not provide one for
you to use, use the generic Certification of Completion in the Toolkit
(Form III-13).
q Make files available for State inspection and audit. Closeout procedures
will vary from state to state, but should be accomplished
within 90 days of their receipt of your Certificate of Completion.
Usually a State representative will review projected and actual work
schedules, all property files (or a representative sample), all documents
pertaining to the use of Federal funds, all procurement files,
Form III-13
Implementation PHASE III
III-36 October 1998
and all contracts to third parties. The reports generated from the
review will be compared to the sub-grant agreement. Any significant
differences will be reported to your State Hazard Mitigation Officer.
The State will take corrective action if necessary.
q Retain files for at least three years after closeout is completed.