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Section 31: Possession and Use Agreements (for State)

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Possession and Use Agreements ( ROW-N-PUAIC Possession and Use Agreement with Additional Payment of Independent Consideration) with an incentive will be offered on every parcel, on every project, on a statewide basis. The incentive is an independent market rental consideration paid to the property owner for the value of the advanced timing of possession. Possession and Use Agreements (PUAs) allow TxDOT to gain irrevocable possession of a parcel while at the same time allowing the landowner to continue contesting the ultimate compensation through the litigation process. This allows TxDOT to possess and construct on a parcel prior to going through a time-consuming special commissioners' hearing process. The market rental payment will make the PUAs a more effective tool as landowners will be more willing to execute the PUA with the market rental payments.

The market rental amount will be calculated at 10% of the initial approved value of a parcel with a minimum amount of $3,000 and a maximum amount of $25,000. The incentive percentage was determined based on industry standards for the recommended amount of a typical yearly market rental rate as associated to the total value of a piece of property. This is money the landowner will never have to pay back to TxDOT regardless of the outcome of the litigation.

Along with the market rental payment the property owner can be paid any portion of the approved appraised value (0-100%) of the parcel as appropriately based on the circumstances of each individual parcel. In determining the amount of the approved value to pay to a landowner, consider the title issues on a parcel and the risk TxDOT may subject itself to double compensation or interrupted possession based on outstanding title issues.

The cost of estimated PUA incentives will not be included in the ROW cost estimates for purposes of a fixed price ROW contribution agreement.

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LPAs are permitted, but are not required, to offer PUA incentives if the LPA is acquiring the ROW through a ROW procurement agreement; however the state will not reimburse any part of elective incentives offered by LPAs which are procuring the right of way.

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