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Section 3: Requests to Lease

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Requirements

A party requesting to lease any of TxDOT's real property assets must submit such request in writing to the District Engineer of the District in which the property is located. Each request must include the following:

  • the name, address and phone number of the party requesting the lease;
  • a general description of the area to be leased, the intended use and the proposed term;
  • a description and sketch of any proposed improvements to be constructed including utilities, drainage and access, and the relationship of any improvements to the existing highway(s); and
  • the name, address and phone number of the individual authorized to act on behalf of the entity requesting the lease.
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Processing a Request to Lease

When the District receives a request to lease an interest in a real property asset from TxDOT, the Right of Way Section in the District should coordinate a review of the request. The purpose of the review is to determine if the District concurs with the request and ultimately recommends the lease or denies the request. The request, description of the area to be leased, description and sketch of any proposed improvements to be constructed, and any other supporting documentation the District deems necessary should be distributed to the following for review and comment:

  • Area Engineer with jurisdiction over the property to be leased,
  • District Design Engineer, and
  • District Maintenance Engineer.

The review should, at a minimum, address the following:

  • Is the subject property surplus to TxDOT's needs or is it currently being used, or will it soon be needed, for any highway purpose?
  • Will the proposed use pose a safety hazard to the traveling public or any other persons or property?
  • Based upon future plans, for what period of time can the property be leased?
  • Would the lease be consistent with beautification, maintenance, and operation of the system (43TAC §21.602)?
  • Would the lease be economically beneficial to TxDOT (43TAC §21.602)?

The District will make a determination of the recommended term for leases. The law mandates that leased property is surplus to TxDOT's needs for at least the term of the lease. TxDOT's long term planning period is twenty years; therefore, lease terms should not extend beyond twenty years. However, there are rare situations where there will be construction of substantial improvements under a lease that may require an exception to this.

These cases usually involve a major capital investment by the lessee with long term financing which may require a longer-term lease. Additionally, as a matter of policy, leases for TxDOT property should always include a cancellation provision whereby the lessee or TxDOT can cancel the lease for any reason upon written notification to the other party. The District determines the time for the notification period, which must not exceed two years. Leases that have a primary term of two years or less, or that include a cancellation provision that is two years or less, may be approved at the ROW Division and are not required to be submitted to the Commission for approval.

If, after review, the District determines that the property can not be leased, the party making the request should be notified in writing. If the District concurs with the proposed lease, the proper party should be notified of such and processing should continue as described below. The same review procedures should be followed even if TxDOT initiates the lease and there is no request from a potential lessee.

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