[Code of Federal Regulations]

[Title 49, Volume 1]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 49CFR24.305]



[Page 246-247]

 

                        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. 24.305  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. 

24.301, 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:

    (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;

    (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; and

    (6) The business contributed materially to the income of the 

displaced person during the 2 taxable years prior to displacement. (See 

Sec. 24.2(a)(7).)

    (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(a)(12)) 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, Sec. 24.305(d).)



[[Page 247]]



    (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 reasonable evidence, which the 

Agency determines is satisfactory. (See appendix A, Sec. 24.305(e).)