OHIO DEPARTMENT OF TRANSPORTATION OFFICE OF REAL ESTATE. Adam Sheets, Manager, Administrative Section. Changes and Updates to the Real Estate Manual

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1 OHIO DEPARTMENT OF TRANSPORTATION OFFICE OF REAL ESTATE DATE: June 23, 2011 TO: FROM: RE: Users of the Real Estate Manual Adam Sheets, Manager, Administrative Section Changes and Updates to the Real Estate Manual The only current and accurate source of ODOT s Real Estate Manual is on the Office of Real Estate s website. This site is located at: Desired information can be accessed by scrolling down the left column and selecting Manuals and Booklets. Specific information can be selected by clicking on the desired section. The Real Estate Manual is a living document as procedures will evolve and change. Individuals or firms providing various services to the Office of Real Estate (e.g. negotiations, titles, appraisal, appraisal review, relocation, relocation review, closing, property management, railroad coordination and utility relocation) must perform these services in compliance with current published policies and procedures. Individuals utilizing a hard copy version of the manual, without accessing the website for updates, risk providing non-compliant services to the Office of Real Estate. Therefore, all users must be aware of the changes as various sections of the manual are updated. ODOT will provide notice of manual changes on the Design Reference Resource Center (DRRC) web page. Users of the manual can access this page and subscribe to be made aware of manual changes via notification. Then, when changes to the manual occur, ODOT will provide direct notice to the subscriber. This page can be accessed at Scroll down to Real Estate Policies and Procedures Manual and select the desired section for updates, or enter your address to subscribe for changes. It is the user s responsibility to maintain their most current address on the DRRC notification system. The DRRC web site is updated four times a year. The Office of Real Estate may also provide additional guidance to its procedures by Inter-Office Communications (IOC s). These communications will be made a part of the Real Estate Manual and will be found in the Addenda of each section of the manual. Individuals having questions pertaining specifically to the 7200 section may contact me at

2 TABLE OF CONTENTS 7200 BUILDING DISPOSITION PAGE 7200 BUILDING DISPOSITION General Procedures for Disposition of Buildings and Site Appurtenances Applicability of Procedures Taking Physical Possession and Protection of Acquired Structures Federal Reimbursement Lead-Based Paint REMOVAL BY ODOT Demolition Contracts Inclusion in the Highway Contract Removal by Maintenance Forces REMOVAL BY OWNER REMOVAL BY SALE General Sale Procedures List of Structures to Be Sold Invitation to Bidders Notice to Bidders Non-Collusion Affidavit Bid Proposal Form Letter of Award Performance Guarantee Availability Letter Receipts from the Sale of Structures Bidding by ODOT Employees Minimum Bids Internet Sales (Formally Bulletin Board Sales) REMOVAL BY GOVERNMENT/NON-PROFIT /23/2011 i

3 7200 BUILDING DISPOSITION BUILDING DISPOSITION All approved ODOT Property Management Forms referenced in this Manual are available on the ODOT Office of Real Estate website. To insure that you are using the most recent version of an approved form, you must access the forms from the website. Do not download forms and save them to your computer. The ODOT Office of Real Estate website may be found at the following location: ( General Procedures for Disposition of Buildings and Site Appurtenances Applicability of Procedures These procedures are applicable to local public agencies (LPAs) as well as ODOT regardless of whether this work is done in-house or by consultants/contractors. When acquisition is not performed by ODOT then the term District property management staff as used in this manual shall be substituted with the appropriate acquiring staff, unless noted otherwise Taking Physical Possession and Protection of Acquired Structures District property management staff is responsible for ensuring compliance with the terms and conditions of the bill of sale, purchase agreement, or the court order at the time of delivery of a structure to the Department of Transportation. Prior to picking up the keys and inspecting an improved property, the District shall review the Form RE 95 to ascertain those items of realty which should remain on the property as a part of the real estate acquired. During the District representative s physical inspection of the premises the District representative will complete the Structure Inspection Report Form RE 95R. In the event the inspection reveals there are missing items of realty which the owner refuses or is otherwise unable to replace, the District representative will advise the owner/agent that it will be necessary for the department to secure a salvage value of the missing items so a deduction from the hold back monies can be made before the balance is paid to the owner. In cases where the owner has remained beyond the agreed date of possession, the District representative will determine the amount that is to be deducted from the hold back monies for payment of back rent. Unless further salvage value or rental determinations are required, the representative will advise the owner/agent that the monies due are available from the closing agent, or if preferred, the refund will be mailed. Possession cannot be exercised until full payment (minus deductions, if any) is made available to the owner. A completed copy of the Structure Inspection Report Form, RE 95R shall be retained in the parcel file. After acceptance of a structure and completion of asbestos requirements, and until delivery of same to a buyer, demolition contractor or highway contractor, the District office shall take steps as are deemed reasonable to prevent vandalism and to protect the structure. These steps may include such measures as boarding up structures, leaving lights burning, surveillance the /23/2011

4 District personnel and leaving a telephone number with adjacent owners willing to keep watch on the structures. Unusual circumstances may require special watchmen and the cost is chargeable as a right of way item. State employees are prohibited from taking any realty or personalty for personal use from any property acquired by the Department. Rodent Control ODOT has a rodent control program to protect the health and welfare of neighborhoods adjacent to ODOT acquired property. ODOT s goal is to exterminate rodents to prevent their migration. A rodent infestation inspection will be performed when the Structure Inspection Report Form RE 95R is completed and results of the inspection will be noted on the RE 95R. If evidence of rodent infestation is discovered, the District will take appropriate steps to remedy the infestation. Rodent control products are purchased from exterminating supply companies. The District is responsible for the procurement, storage and distribution of the Rodenticide and must comply with all manufacturer instructions. Whenever a structure is baited with Rodenticide a white and red ODOT approved sign will be placed on every entrance to the structure. The District shall keep a log of all structures reported to have heavy infestation and cause a second inspection to be made within three to five days from the initial baiting. If on the second inspection, most of the first baiting has been consumed, a second baiting will be placed to insure the rodents consume lethal doses. Additional inspections after the second baiting shall be made when deemed necessary. If the District determines that rodent extermination can be handled best by contract forces, they will follow department purchasing procedures and will be responsible for maintaining proper surveillance over the contract exterminators they have hired Federal Reimbursement Deposits from structure sales must be correctly coded to assure proper FHWA credit. The District office is responsible for correctly designating FHWA participation on the RE 24-1 forms that are used to process income from the sale of structures Lead-Based Paint Section 1018 of the Residential Lead-Based Paint Hazard Reduction Act of 1992 and Volume 61 Federal Register requires disclosure of information on lead-based paint and leadbased paint hazards before the sale or lease of homes built before When any residential unit built before 1978 is sold a Lead Paint Disclosure to Purchasers is to be executed and maintained in the file REMOVAL BY ODOT Demolition Contracts Contracts for the removal of buildings can be let on a project basis. All of the buildings will be placed under demolition contract as early in the project as is feasible. The District will determine the appropriate time to let the demolition contract. Ample time should be allocated for District preparation of a demolition plan. District will create a set of building removal plans 06/23/

5 for all structures which will be removed. Refer to Form RE Guidelines for Preparation of Building Removal Plans for more information on preparing plans. Once the plans are complete and the project has been programed, the District will submit a request to the Office of Contracts to sell the demolition contract. Contract duration is directed by the District based on project circumstances. Buildings that are unavailable will be non-performed. There are certain situations where it is impractical to let a demolition contract on a project wide basis. An example of this situation would be where a project is two years or more removed from the construction letting date and full scale acquisition is not being pursued. On projects of this nature, where the presence of vacant buildings may create a public nuisance, a contract may be let for only those buildings. Municipalities letting their own contracts for building removal must secure proper clearance and approval through the District. Release of Structures Following the signing of the contract with the successful bidder, the Office of Contracts will notify the District Highway Management Administrator that the contractor may begin work when buildings are released for demolition. The contractor may remove only those buildings which have been released to the District Highway Management Administrator by the District Real Estate Administrator as authorized by means of a Structure Release, Form RE Inclusion in the Highway Contract Prior to the plan package filing date, the District will conduct a review of all buildings and site appurtenances located on the project to determine their status. Those structures not yet disposed of by sale, demolition, or other means will be added to the highway construction plans as 202 items to be removed by the contractor. The Exhibit C The Exhibit C (Federal or State, Forms RE and RE 73-16) is notification to the bidders of the anticipated possession dates of structures that will not be available by the project sale date. If a structure will not be available by the date of sale then the District is responsible for preparing and including an Exhibit C as part of the plan file package sent to the Office of Contracts. Release Of Structures After the construction contract has been awarded, all buildings on parcels shown on the Exhibit C shall be released to the District Highway Management Administrator by the District Real Estate Administrator by means of a Structure Release, Form RE Removal by Maintenance Forces There are situations where removal of structures by District Maintenance forces is desirable. A District may keep a certain building or part thereof for its own use, in which case it is not offered for sale. A District may remove a structure if no one will take the structure, even as a gift and it is too small an operation to warrant a demolition contract /23/2011

6 7203 REMOVAL BY OWNER See Section 5311 of the Real Estate Policies and Procedures Manual for detailed instructions on owner retention REMOVAL BY SALE General Sale Procedures Disposition of buildings may be accomplished by advertising them for sale to the highest bidder by either the sealed bid process or by public auction. Sale by sealed bid is the preferred method and is outlined below. If the District chooses to sell a structure through a public auction, the invitation and notice described below must be modified accordingly. Districts are invited to contact Central Office Property Management for assistance should they choose to pursue a public auction of structures. Structure sales may occur even though all the structures on the project may have previously been included in a blanket demolition contract. Structures which are subsequently advertised and sold are then removed from the blanket demolition contract. Full consideration must be given by the District to utilizing this method of building removal. This method can yield double benefits by saving the department the cost of removal while also generating income through the sale. Under Section R.C. when the structure or appurtenance has a fair market value of $1, or more as determined by the director, the director shall post a notice of the sale, for not less than ten days, on the official web site of the department. If the District where the structure is located maintains a web site, notice of the sale also shall be posted on that web site. At least ten days before the sale, the director also shall publish one notice of the sale in a periodical or newspaper of general circulation in the District in which the structure is located. A sale shall be made to the highest responsible bidder. If, in the opinion of the director, any structure to be sold has an estimated fair market value of $1,000 or less, the director is not required to advertise the proposed sale except by notice posted on the official web site of the department. The notice shall be posted for at least five working days. A sale shall be made to the highest responsible bidder. Criteria to be used by the District in determining what buildings will be offered for sale should include but not be limited to the following: The particular type of building(s) or appurtenances involved The economic viability of relocating the structure The amount of time before the project construction is scheduled to begin Buildings may be offered for sale before they are vacated by the occupant as long as definite relocation arrangements have been made for the occupant List of Structures to Be Sold District will prepare a list of potential structures available for sale. The list shall contain a description of each structure to be sold and be complete enough so that the description appearing in the Notice To Bidders, Form RE can be prepared. This description shall include the 06/23/

7 location of the property and any unusual features such as concrete slabs that must be removed, items to be retained by the owner, or any other feature which a bidder should be aware of in submitting a bid. The approximate possession date for each structure and the time to be allowed to complete the removal, if other than the standard 70 days, must also be shown Invitation to Bidders District will prepare an Invitation to Bidders, Form RE that contains a brief description of the structures to be sold, the forms required and where they may be obtained, and a statement of the time and place where bids will be received. When a structure is known to contain a regulated amount of asbestos, a statement to that affect shall be included. The invitation is prepared by the District concurrently with the Notice To Bidders, Form RE and published in a newspaper that has circulation in the area where the buildings are located. Section R.C., requires one publication at least 10 days before the opening of bids. If the district believes additional advertising is warranted, additional advertisements may be published in the same or different newspapers. To assure the greatest possible return from buildings sold, the District Public Information Office should attempt to secure news releases through newspapers and or other advertising media in addition to the publication of the notice required by law. House buying seminars and or meetings can be held to generate interest and inform the public of what is involved with buying and relocating a home. The Office of Real Estate, Property Management Unit can be contacted for help in arranging a seminar or meeting Notice to Bidders The Notice To Bidders, Form RE gives the time and place of receiving bids, the terms and conditions of the sale, the requirements of the removal operation, the forms required and where they may be obtained. When a structure is known to contain a regulated amount of asbestos, a statement to that affect shall be included. When the structure being sold is a residential unit built before 1978, a Lead Paint Disclosure to Purchasers, Form RE for disclosure of information on lead-based paint and or lead-based paint hazards and a copy of the pamphlet Protect Your Family from Lead in Your Home must be included as part of the Notice To Bidders. An executed Lead Paint Disclosure to Purchasers must be part of a bid proposal in order for the bid to be accepted. Forms RE Parcel For Sale Flyer and RE Successful Bidder Guide are provided as additional tools to aid in the selling process. By reference made in the Letter of Award, the Notice To Bidders will become a part of the contract for purchase and removal of the structure. When the notice is prepared a copy shall be transmitted to the Office of Real Estate, Property Management Unit, all persons on the state-wide and District office list of bidders and to any other person whose request has been received Non-Collusion Affidavit Attached with the Notice To Bidders is a Non-Collusion Affidavit, Form RE 73-02, to be signed by the bidders. The affidavit states that the bidder has not entered into any agreement or participated in any collusion in restraint of free competitive bidding in connection with the /23/2011

8 structure sale. The bidder shall return a signed and notarized affidavit with the Bid Proposal Form. When an auction is the method of sale the Non-Collusion Affidavit must be signed and notarized prior to closing Bid Proposal Form The Bid Proposal Form, RE-79, as specified in both the Invitation to Bidders and the Notice To Bidders, is the only form acceptable in the presentation of a bid. It shall be the responsibility of the bidder to submit the signed Bid Proposal Form, with attached remittance in the amount of the bid, at the time and place designated in the Notice to Bidders. The District shall publicly open, tabulate and announce the successful bidder at the time and place described in the Invitation and Notice Letter of Award The District office then prepares a Letter of Award, Form RE 73-01, which recites the highest and best bid, if any, on each structure included in the Notice to Bidders, and awards title to the successful bidder, subject to the terms and conditions contained in the Notice To Bidders. When a structure is known to contain a regulated amount of asbestos, a statement to that affect shall be included. It also recites the action taken on the remittances submitted by the unsuccessful bidders. The Letter of Award is sent to the successful bidder by the District as evidence of title. A copy is also sent to unsuccessful bidders with the return of the remittance submitted with their bids. Unsuccessful bidders who are present at the time of the opening of bids will have their remittance returned to them at that time Performance Guarantee Before physical possession of a structure is given as part of a structure sale, the District Real Estate Administrator/Engineer shall establish a performance guarantee amount for each item, keeping in mind the minimum performance guarantee is $ Upon receipt, the performance guarantee shall be submitted to the District Finance office where a non-invoice sheet, AU-11, will be prepared in the Accounts Receivable System (ARS), using receipt code The AU-11 is submitted to Central Office Accounts Receivable for deposit. In the event the Performance Guarantee is not filed within the time provided, the District shall notify the bidder by certified mail that the former award is rescinded and that title is retained by the State. The bid amount is declared forfeited and is retained by the State as liquidated damages. When the removal work has been completed and inspected, the District shall process a request for return of the Performance Guarantee, Form RE If the bidder has been late in the completion of the removal work and is to be charged liquidated damages, the written request shall reflect the number of days chargeable and the amount to be deducted from the Performance Guarantee. An AU-65 refund form should be completed with the amount of refund to the bidder and submitted to Central Office Capital Accounting where a refund check will be completed. If you would like the check submitted back to the District please request this on the AU-65 form. The District is responsible for supervising the removal of the structures under the terms and conditions of the sale. If removal is not accomplished pursuant to the terms of the sale, the 06/23/

9 District office will take the necessary action to clear the right of way, including issuing a removal order and recovering the cost from the Performance Guarantee, if necessary. The Notice to Bidders spells out reasons for which a time extension may be granted. Supportive evidence from the bidder shall be reviewed by the District before a request is approved or denied Availability Letter After the Letter of Award has been issued, the Performance Guarantee has been received and the building is available to the successful bidder, the District office shall send out an Availability Letter, Form 73-06, giving the successful bidder possession of the building or site appurtenances. The Availability Letter specifies the date established for completion of the removal operation Receipts from the Sale of Structures As soon as bids are received, a Form RE 24-1, remittances of successful bidders, and a copy of the Letter of Award are submitted to Central Office Property Management and to the District Finance office where a non-invoice sheet, AU-11, will be prepared in the Accounts Receivable System (ARS), using receipt code The AU-11 is submitted to Central Office Accounts Receivable for deposit along with the RE Bidding by ODOT Employees ODOT employees may not bid on any structure sale whether by sealed bid or by auction Minimum Bids There is no requirement for a minimum bid on a structure sale whether by sealed bid or auction. The competitive nature of these sales assures the highest bids Internet Sales (Formally Bulletin Board Sales) Section , ORC effective June 29, 2005, provides that: (b) If, in the opinion of the director, any item to be sold has an estimated fair market value of one thousand dollars or less, the director is not required to advertise the proposed sale except by notice posted on the official web site of the department. The notice shall be posted for at least five working days. A sale under division (C)(2)(b) of this section shall be made to the highest responsible bidder. The official web site of the department shall mean the web site of the District in which the items to be sold are located. A. Procedure For Internet Sales Structures offered in this manner are ones that received no bids in the sealed bid or public auction sale process or that would have limited interest, namely old houses, barns, sheds, garages, etc. Structures for which no bids were received in the sealed bid or public auction sale process may be re-offered by the District office in an Internet Sale. To accomplish an internet sale, an Internet Sale Notice to Bidders is prepared and placed on the Official District Website /23/2011

10 for 5 business days. The procedure for internet sales is detailed on form RE 73-12, Guidelines for Internet Sales-Formally Bulletin Board Sales. A copy of the Internet Sale Notice is to be sent to Office of Real Estate, Property Management Unit by the District office at the time of posting. A. Documentation Of Sale Where no bids are received on an Internet Sale, the District office shall place a copy of the notice in their files with the notation that no bids were received. Where one or more bids are received, a tabulation and Form RE 24-1 are prepared and submitted to the District Finance office where a non-invoice sheet, AU-11, will be prepared in the Accounts Receivable System (ARS), using receipt code The AU-11 is submitted to Central Office Accounts Receivable for deposit along with the RE A copy of RE 24-1 is also sent to Central Office Property Management. Remittances of successful bidders and Bid Proposal Forms of all bids submitted must accompany the tabulation. Remittances of unsuccessful bidders shall be returned directly to the bidders by the District. The District shall prepare a Letter of Award and have it distributed in the same manner as an advertised sale. If, after the time to receive bids on an Internet Sale has passed and no sale was consummated, and an individual indicates an interest in any of the buildings that were previously offered for sale, they must again be re-offered in an internet sale REMOVAL BY GOVERNMENT/NON-PROFIT Another means of disposition available to the state is the Letter of Award for Removal without Cost, Form RE This agreement is usually with a local fire department, historical society, a non-profit organization or some other equally responsible public organization. The party requesting to remove the structure, at no cost to the state, shall prepare and send a letter to the District office stating the reason for their request and the time required for removal. The letter shall further state that the party, upon award, will be responsible for, and the Department of Transportation held harmless from, all claims for damages that may occur during the removal operation. Any terms, conditions, and performance guarantee on this type of disposition are imposed at the discretion of the District office. If the removal is permitted without a performance guarantee being required, and the work is not completed as agreed, it shall be the responsibility of the District office to complete the removal operation. If removal is to be completed by a non-profit corporation that is not a political subdivision of the State, the non-profit must provide a copy of the contract identified in O.R.C. Section (B)(3). When the Letter of Award for Removal without Cost is prepared for a Fire or Police Department a Form RE 73-14, Fire and/or Police Department Service Training Release, is to be properly completed including Exhibit B with the names, dates and signatures of all department employees and or members participating in the training exercise. When a structure is used for Fire or Police training, the letter of award for removal must include a requirement that the Fire or Police department remove the entire structure upon completion of the training exercise. 06/23/

11 The Ohio Environmental Protection Agency, by OAC (E ) requires that If a facility is demolished by intentional burning, or if demolition debris is to be burned, all regulated asbestos-containing material including Category I and Category II Nonfriable asbestos-containing material must be removed in accordance with this Chapter before burning. The entity that burns structures must make all required notifications of the EPA Office and must obtain and comply with all required permits. The District shall be responsible for monitoring the process /23/2011