[Code of Federal Regulations]
[Title 49, Volume 1]
[Revised as of October 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 49CFR24.306]

[Page 221-223]
 
                        TITLE 49--TRANSPORTATION
 
          Subtitle A--Office of the Secretary of Transportation
 
PART 24_UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY ACQUISITION FOR 
FEDERAL AND FEDERALLY ASSISTED PROGRAMS--Table of Contents
 
           Subpart D_Payments for Moving and Related Expenses
 
Sec.  24.306  Fixed payment for moving expenses--nonresidential moves.

    (a) Business. A displaced business may be eligible to choose a fixed 
payment in lieu of the payments for actual moving and related expenses, 
and actual reasonable reestablishment expenses provided by Sec. Sec.  
24.303 and 24.304. Such fixed payment, except for payment to a nonprofit 
organization, shall equal the average annual net earnings of the 
business, as computed in accordance with paragraph (e) of this section, 
but not less than $1,000 nor more than $20,000. The displaced business 
is eligible for the payment if the Agency determines that:

[[Page 222]]

    (1) The business owns or rents personal property which must be moved 
in connection with such displacement and for which an expense would be 
incurred in such move; and, the business vacates or relocates from its 
displacement site.
    (2) The business cannot be relocated without a substantial loss of 
its existing patronage (clientele or net earnings). A business is 
assumed to meet this test unless the Agency determines that it will not 
suffer a substantial loss of its existing patronage; and
    (3) The business is not part of a commercial enterprise having more 
than three other entities which are not being acquired by the Agency, 
and which are under the same ownership and engaged in the same or 
similar business activities.
    (4) The business is not operated at a displacement dwelling solely 
for the purpose of renting such dwelling to others.
    (5) The business is not operated at the displacement site solely for 
the purpose of renting the site to others.
    (6) The business contributed materially to the income of the 
displaced person during the 2 taxable years prior to displacement (see 
Sec.  24.2).
    (b) Determining the number of businesses. In determining whether two 
or more displaced legal entities constitute a single business which is 
entitled to only one fixed payment, all pertinent factors shall be 
considered, including the extent to which:
    (1) The same premises and equipment are shared;
    (2) Substantially identical or interrelated business functions are 
carried out and business and financial affairs are commingled;
    (3) The entities are held out to the public, and to those 
customarily dealing with them, as one business; and
    (4) The same person or closely related persons own, control, or 
manage the affairs of the entities.
    (c) Farm operation. A displaced farm operation (defined at Sec.  
24.2) may choose a fixed payment, in lieu of the payments for actual 
moving and related expenses and actual reasonable reestablishment 
expenses, in an amount equal to its average annual net earnings as 
computed in accordance with paragraph (e) of this section, but not less 
than $1,000 nor more than $20,000. In the case of a partial acquisition 
of land which was a farm operation before the acquisition, the fixed 
payment shall be made only if the Agency determines that:
    (1) The acquisition of part of the land caused the operator to be 
displaced from the farm operation on the remaining land; or
    (2) The partial acquisition caused a substantial change in the 
nature of the farm operation.
    (d) Nonprofit organization. A displaced nonprofit organization may 
choose a fixed payment of $1,000 to $20,000, in lieu of the payments for 
actual moving and related expenses and actual reasonable reestablishment 
expenses, if the Agency determines that it cannot be relocated without a 
substantial loss of existing patronage (membership or clientele). A 
nonprofit organization is assumed to meet this test, unless the Agency 
demonstrates otherwise. Any payment in excess of $1,000 must be 
supported with financial statements for the two 12-month periods prior 
to the acquisition. The amount to be used for the payment is the average 
of 2 years annual gross revenues less administrative expenses. (See 
appendix A of this part).
    (e) Average annual net earnings of a business or farm operation. The 
average annual net earnings of a business or farm operation are one-half 
of its net earnings before Federal, State, and local income taxes during 
the 2 taxable years immediately prior to the taxable year in which it 
was displaced. If the business or farm was not in operation for the full 
2 taxable years prior to displacement, net earnings shall be based on 
the actual period of operation at the displacement site during the 2 
taxable years prior to displacement, projected to an annual rate. 
Average annual net earnings may be based upon a different period of time 
when the Agency determines it to be more equitable. Net earnings include 
any compensation obtained from the business or farm operation by its 
owner, the owner's spouse, and dependents. The displaced person shall 
furnish the Agency proof of net earnings through income tax returns, 
certified financial statements, or other

[[Page 223]]

reasonable evidence which the Agency determines is satisfactory.

[54 FR 8928, Mar. 2, 1989, as amended at 64 FR 7132, Feb. 12, 1999]