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Right-of-Way Cost Estimating Ohio DOT Perspective

Right-of-Way Cost Estimating Ohio DOT Perspective. R/W & Utilities Subcommittee Conference Florida 2007. Project Development Process. All projects must go through a PDP Process to: ● E ncourage communication among all disciplines ● I ncrease plan quality

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Right-of-Way Cost Estimating Ohio DOT Perspective

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  1. Right-of-Way Cost Estimating Ohio DOT Perspective R/W & Utilities SubcommitteeConference Florida 2007

  2. Project Development Process All projects must go through a PDP Process to: ● Encourage communication among all disciplines ● Increase plan quality ● Foster better management of the agency’s resources ● Document reasoning behind project-related decisions • Documentation includes Right-of-Way cost estimating which is: • Required at the initiation of a project • Updated throughout PDP process, and • Becomes part of the decision making process

  3. Project Types Projects are divided into 3 types

  4. STEPS 1-10 OF THE OF THE PDP PROCESS On Major Projects (Steps 1- 6) • No real plans at this point; many assumptions must be made. • Market Survey and Tax Roll data are used to estimate costs. • Conversations with Realtors, Auctioneers • Pulling base comparables from local MLS • Talk to County Auditor to find comparables they use for various property types • Pull Tax Roll data on random sampling of properties within project area On Major Projects (Steps 7-10) • Once preferred alignment selected, overlay alignment over tax maps and aerials. Determine: • the take • the impact to the residue • relocation issues • valuation formats • complexity of the project • time necessary for the acquisition, and • capacity of in house staff versus using consultants • Gather verified market data for more accurate costs • Data books having verified sales that are reflective of the property types being impacted • People along the project site physically inspecting the take area and the residue and determining the impact of the take on the residue • Start assessing complexities of acquisition-appraisal-relocation processes on preferred alignment • Estimate of damages to residue becoming more apparent • Serious R/W project management starts, and R/W Costs become market driven at this point

  5. General Formula Estimate value today (Compensation paid)(at Step 1) + Relocation Costs(Est. Payment to owner)(at Step 5) + Consultant Labor Costs (at Step 6) Subtotal A + Adj. for Time(Current to R/W Authorization date)(at Step 1) Subtotal B + Adj. for Administrative Settlements (at Step 1) + Adj. for Appropriations (at Step 1) +Adj. for Incidental Expenses(at Step 1) TOTALCOST TOTAL COST ROUNDED

  6. Information onRelocation Costs Relocation Costs(Est. Payment to Owner): ● Residential Owner $ 40,000 ● Residential Tenant $ 11,750 ● Commercial/Farm $ 25,000 ● Personal Property $ 1,000

  7. Information onLabor Costs Consultant Labor Costs: Titles . . . . . . . . . . . . . . . $ 400/pcl Appraisal Simple . . . . . . . $ 750/pcl Detailed . . . . . . $ 4,000/pcl Appraisal Review Simple. . . . . . . . $ 500/pcl Detailed . . . . . . $ 2,000/pcl Negotiation . . . . . . . . . . $ 1,100/pcl Relocation PP Move . . . . . . $ 1,500/displacee Residential Move $ 5,200/displacee Commercial Move$ 5,600/displacee Closings . . . . . . . . . . . . . $ 400/ownership Project Management . . . $ 550/pcl Asbestos Testing . . . . . . $ (determined by project)

  8. Information onAdjustments Adjustment for Time: ● Based on market support or average % of change in CPI over last 5 yrs. Adjustment for Administrative Settlement: ● Assume 15% of parcels settle by Adm. Settlement at average of 20% over offer ●[Subtotal B x 0.15] x 1.20 Adjustment for Appropriation ●Assume 10% of parcels will be appropriated ● Appropriated parcels will settle at amount 50% over offer ● Formula is [Subtotal B x 0.10] x 1.50 Adjustment for Incidental Expenses ● Assume ODOT will have some incidental expense ● 90% of parcels will settle and close ● Amount is estimated to be 2.5% of settlement amount ● Formula is [Subtotal B x 0.90] x 0.025

  9. STEP 1 OF THE PDP PROCESS • Working with stakeholders to understand problems and needs • No plans • Defining the Study Area • Developing an initial cost estimate _________________________________ This is what you have……….. A 500 square mile study area

  10. STEP 1 OF THE PDP PROCESSDefining the Study Area - 500 Sq. Mile Study Area

  11. Developing an Initial Cost Estimate Given the study area, I’m assuming that the highway will be: ● a single corridor (located somewhere in the study area): ● a 4 lane divided facility ● 300 feet wide ● the length of the study area _________________________________ Visualizing the assumptions……..a defined area

  12. STEP 1 OF THE PDP PROCESSGreen Line is Defined Area

  13. Determining“Value Today”for the Formula Working with a corridor that is 300 ft. wide x 36 miles long: 1. Determine Land Usage Within this Corridor: • By using a combination of aerial photographs and County Profiles, one can assume: ●70%agricultural●24%residential ●5%commercial●1%industrial 2. Determine values appropriate for land usages within corridor: • Ignore structures within the corridor • Focus only on the land • Ask local Realtors and Auctioneers what land is going for (now too difficult to use tax roll data) 3. Break the 36 mile long corridor into land-use segments; verify per-acre price for each segment: • Agricultural Land $3,500/acre • Residential Land $5,000/acre • Commercial Land $7.00/SF or $304,920/A • Industrial Land $2.50/SF or $108,800/A

  14. Determining“Value Today”for the Formula (cont’d) Using 5,280 LF = 1 mile/43,560 SF = 1 Acre: 1. Calculate the total acreage within corridor. • Determine how many linealfeet are in the 36 mile corridor: 36/Miles x 5,280/LF = 190,080/LF • Determine how many squarefeet are in the corridor: 300/ft. wide x 190,080/ft. long = 57,024,000 SF • Determinehow many acres are in the corridor: 57,024,000 SF ÷ 43,560 = 1,309 Acres in the corridor 2. Calculate the number of acres in each land use segment using the land-use ratios. • Calculate the value of the acres in each land use segment. • Calculate the value of all the land in the corridor as of today. Goes into the formula

  15. Determining Adjustment for Timefor the Formula • Adjust current value forward in time to anticipated Sale Date or R/W Authorization Date • This information provided by District Office • Assume 4 years from now • Time is based on market evidence or CPI and tempered with reason • Reflects history and not necessarily indicative of the future • Assume 2.5% per year increase over thenext 4 years • Using an HP-12C calculator, the time adjustment is: 4N 2.5i 1CHS PV Solve for FV = 1.1038 $26,164,710 x 1.1038 = $28,880,607 Goes into the formula

  16. Developing the Cost EstimateDetermining Other Adjustments for the Formula Adjustment for Administrative Settlements [ $28,880,607 x 0.15] x 1.20 = $5,198,509 Adjustmentfor Appropriations [$28,880,607 x 0.10] x 1.50 = $4,332,091 Adjustmentfor Incidentals [$28,880,607 x 0.90] x 0.025 = $649,813

  17. STEP 1Entering Other Adjustments into the Formula Estimate value today (Slide 16) $26,164,710 Relocation Cost (at Step 5) -0- Consultant Labor Cost (at Step 6)-0- Subtotal A$26,164,710 Adj. for Time (Slide 20) x 1.1038 Subtotal B $28,880,607 Adj. for Administrative Settlements (Slide 22) + 5,198,509 Adj. for Appropriations (Slide 22) + 4,332,091 Adj. for Incidentals (Slide 22) + 649,813 Total Estimated Cost$39,061,020 Rounded to: $39,060,000

  18. STEP 7 - An Overview • 3. Create a Sales Data Book • ● All Sales in Sales Data Book to be • of vacant land • ● Utilize local Realtors, appraisers, • staff or consultants • ● Verify market data to reflect • property types in the corridor • ● Use ODOT standard data sheet 1. Preferred alignment identified 2. Approximate centerline known ●Topographical ground survey features collected ● Utilities and their depths shown ● Railroad acquisitions identified ● Preliminary Plan and Profile sheets shown ● Preliminary construction limits shown ● Cross section being developed ● Individual auditor parcels now known 3. Create a Sales Data Book ● All Sales in Sales Data Book to be of vacant land ● Utilize local Realtors, appraisers, staff or consultants ● Verify market data to reflect property types in the corridor ● Use ODOT standard data sheet 4. Update Costs Estimate for: ● Improved properties ● Damages to residue properties ● Relocation Costs ● Consultant Labor costs for R/W Acquisition

  19. STEP 9 - An Overview Overview ● Stage 1 review completed; comments incorporated into the Stage 2 design ● Preliminary R/W Plans available ● Summarize environmental commitments; prepare environmental plan notes ● Stage 2 Detailed design is created at the end of this step Address Serious Project Management Decisions • Time needed for relocation process • Use staff or consultants for relocation • Time needed for acquisition parcels • Use staff or consultants Determine the complexity of the appraisal process • Engage the appraisal reviewer • Create parcel impact notes • Define the valuation issues • Determine the scope of appraisal needed • Determine the type of appraisal needed • Use staff or consultants

  20. STEP 9 - An Overview Other Determinations • Consultant utilization • Money needed to pay the consultant • Process to encumber money, and • Contracting process to engage consultants Update Cost Estimate ● Preliminary R/W Plans basis for cost estimate • Workplan used to estimate costs ● Pre-Acquisition Surveys initiated for Relocation parcels • Skilled relocation people estimating relocation cost ● Tax roll data no longer used for improvements • Skilled eminent domain people estimating value to improvements taken and damages (if any) to residue ● Update labor cost Example of a Step 9 Cost Estimate ● Focus will be on 1 Parcel ● Based on Preliminary Plans ● Use: Summary Sheet (Slide 37) Property Map Sheet Detail Sheet

  21. Parcel 283 WL Before – 5.371 Net Acres Take – 1.783 Acres Remainder – 3.588 Acres

  22. House located along existing road at front of property At grade crossing at Intersection of US 24 and Whetstone Road New 4 lane median Divided road, limited access Located to the rear of the property

  23. Small horse barn 103 ft. from R/W 1,570 LF of 4 Strand barb wire Fence on wood poles taken LA R/W CL of Project

  24. From the Cross Section and the Data Book Using Information from the Cross Sections ● Grade change is minimal – about 4 feet ● EOP is about 100 feet from the rear property line Using Information from the Data Book Zoning for Parcel 123: AG Residential ● Defined as Agricultural Residential ● Min site size is 1.5 acres ● Setbacks are: 50 feet from CL of any road 30 feet from the rear property line 15 feet side property line ● Min. frontage of 200 feet Land value ● For 5 to 10 acre Residential Use Properties ● Ranges from $3,000 to $5,000 per acre

  25. STEP 9 - Determining Estimate ValueToday From Data Book Range is $3,000 to $5,000/A Estimate $4,000/Acre Take Area is 1.783 Acres Land Value Estimate: ●$4,500/A x 1.783 A = $8,023 Improvements Taken: Fence taken – 1570 LF Cost New is $7.00/LF Fence taken is older – Est. 50% depreciated ● $7.00 x 50% = $3.50 Estimate of Fence: ● 1,570 LF x $3.50/LF =$5,495 Damages: No fence along R/W to keep livestock out of roadway Need CTC to create a fence Cost to Cure ● 214 feet x $7.00/LF =$1,498 Put It Together Land Value Estimate: $ 8,023 Estimate of Fence: $ 5,495 Cost to Cure: $ 1,498 Est. Value Today: $15,016

  26. STEP 9 - Determine Consultant Labor Costs Consultant Labor Cost: ● Amounts from Slide 9 _______________________________________ Titles $ 400/parcel Appraisal – Simple $ 750/pcl Appraisal Review – Simple $ 500/pcl Negotiation $1,100/pcl Closings $ 400/ownership Project Management $ 550/pcl Total$3,700/Parcel 123

  27. STEP 9 - Determining Adjustment for Time Adjustment for Time: ● Time is to based on market evidence or CPI and is also to be tempered with reason. ● Reflects history and not necessarily indicative of the future ● Assume 2.5% per year increase ● Assume from current date until R/W clear date of 2.5 years Calculate It Using an HP-12C calculator, the time adjustment is: 2.5N 2.5i 1CHS PV Solve for FV = 1.0638 $18,716 x 1.0638 = $19,910

  28. STEP 9 - Determining Other Adjustments Adjustmentfor Settlements [ $19,910 x 0.15] x 1.20 = $3,584 AdjustmentforAppropriations [$19,910 x 0.10] x 1.50 = $2,986 AdjustmentforIncidentals [$19,910 x 0.90] x 0.025 = $ 448

  29. STEP 9 - Updating the Formula Estimate value today: (slide 58)$15,016 + Relocation Cost: -0- + Consultant Labor Cost$ 3,700 Subtotal A$18,716 +Adj. for Timex 1.0638 Subtotal B $19,910 +Adj. for Adm. Settlements (slide 53)$ 3,584 + Adj. for Appropriations (slide 53)$ 2,986 +Adj. for Incidental Expenses (slide 53) $ 448 Total Cost$26,928

  30. Questions? • Douglas S. Maitland • Ohio DOT • (614) 466-6802 • dmaitland@dot.state.oh.us

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