![](media/image1.wmf){width="0.5659722222222222in"
height="0.5493055555555556in"} **U. S. Department of Housing and Urban
Development**

**Public and Indian Housing**

> **Special Attention of:** NOTICE PIH-2009-01 (PHA)
>
> Public Housing Agencies (PHAs);
>
> Public Housing Resident Management Corporations; Issued: January 2,
> 2009
>
> HUD Public Housing Program Directors;
>
> HUD Regional Counsels Expires: January 31, 2010
>
> [Cross References]{.underline}
>
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>
> **Subject**: Guidance for Obtaining HUD Consent for Takings of Public
> Housing Property by Eminent Domain

1.  **Purpose.** This Notice provides guidance on the factors that HUD
    will consider in determining whether to consent to a taking of
    public housing property that was developed/acquired by, or is
    maintained with funds from the United States Housing Act of 1937
    (the "Act") by a governmental or quasi-governmental body using
    eminent domain authority ("Taking Body"). For purposes of this
    Notice, public housing property does not include the property of an
    Indian Housing/Tribally Designated Housing Entity. Most public
    housing property is owned by PHAs, but units owned by private
    entities in a mixed-finance arrangement may also be operated as
    public housing pursuant to 24 CFR 941 (Subpart F). .

2.  **Background.** Eminent domain is an exercise of the power of a
    Taking Body to take property for a public use upon just compensation
    to the owner. Taking Bodies may include not only State or local
    government agencies, but also entities such as airport authorities,
    highway commissions, community development agencies, and utility
    companies. A Taking Body may propose to exercise its eminent domain
    authority to take public housing property. Public housing property
    is unique in that both HUD and the respective PHA have an interest
    in the property---the PHA has a direct interest as legal owner of
    the property and HUD has an interest under the Annual Contributions
    Contract (ACC) and the Declaration of Trust (DOT). Because this
    interest is property of the United States, HUD's consent to the
    taking of public housing property is necessary.

    HUD does not impose requirements on Taking Bodies since they are
    free at any time to proceed in the courts. This Notice acknowledges
    that the rights of the parties involved in an eminent domain
    proceeding, including HUD, will ultimately be determined by courts
    if the parties are in disagreement. This Notice is intended only to
    provide guidance on some of the factors that HUD may choose to
    consider in deciding, on a case-by-case basis, whether to consent to
    a taking of public housing property. An agreement between the
    parties (e.g., PHA and Taking Body) on the terms of a taking does
    not negate the requirement to obtain HUD's consent. If HUD does not
    agree to a taking, it may choose to enforce its interest in the
    public housing property by requesting that the Department of Justice
    intervene in the eminent domain proceeding or petition the court to
    dismiss the proceeding on jurisdictional grounds.

3.  **Relation to HUD's demolition/disposition regulations in 24 CFR
    Part 970.** Takings under eminent domain are exempt from HUD
    regulations at 24 CFR part 970, which implement Section 18 of the
    Act. However, HUD may consent to eminent domain proceedings on a
    case by case basis if the interests of public housing residents,
    PHAs, and HUD are adequately protected.

4.  **Use of Eminent Domain.** Under the ACC, PHAs "shall at all times
    develop and operate each project solely for the purpose of providing
    decent, safe, and sanitary housing for eligible families." A
    proposed action is an exercise of eminent domain subject to this
    Notice when:

a\) The Taking Body has been authorized to acquire real property by
eminent domain

> under State law; and

b)  The Taking Body announces its intent to use its power of eminent
    domain to take a

> PHA property.

Because eminent domain takings are typically highly expedited
proceedings, PHAs are required to begin the process of securing HUD
approval as soon as possible.

5.  **Factors for Determining HUD Consent.** Some of the factors which
    HUD may consider in making its determination of whether to consent
    to a taking of public housing property include:

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a)  *Agreement Between the PHA and the Taking Body*. HUD will consider
    if the PHA has agreed to the taking and/or has entered into an
    agreement with the Taking Body for the taking;

b)  *PHA Board Support*. HUD will consider evidence (e.g., Board
    Resolution) showing the PHA Board supports the taking;

c)  *Authority of the Taking Body.* HUD will consider the legal
    sufficiency of the evidence of the Taking Body's authority under
    applicable State laws to acquire the public housing property;

d)  *Compensation for the Dwelling Units Taken*. The Taking Body may
    provide either monetary compensation or replacement housing as
    compensation to the PHA for the units taken. HUD should generally
    consider the following factors when assessing its consent based on
    the adequacy of the compensation.

> If the Taking Body chooses to provide monetary compensation, HUD staff
> should consider the compensation offered and the cost of replacement
> housing for all units taken. HUD staff may base its consideration of
> the adequacy of compensation on the cost of creating the same kind and
> number of units of housing, facilities, and other property on a
> one-for-one basis, or the fair market value (FMV) of the public
> housing property (as determined by an independent appraiser). The cost
> of replacement units should be based on comparable size and unit
> configuration to those taken, except where the Taking Body or PHA can
> demonstrate, and HUD concurs, that there is a lack of need for the
> unit configuration or size or configuration of units taken, or there
> is a greater need for another unit size.
>
> If the Taking Body is proposing to provide replacement property
> instead of
>
> monetary compensation, HUD may evaluate the description of the
> replacement property, together with an appraisal of the FMV of that
> property. HUD should generally consider the compensation adequate if
> the appraisal shows that the FMV of the replacement property is not
> less than the FMV of the public housing property being taken. However,
> other factors may be considered as well; for example, if the FMV of
> the replacement property is of a lesser value than the FMV of the
> public housing property being taken, HUD may approve the replacement
> property if the Taking Body is willing to adequately compensate the
> PHA. All replacement units must meet HUD\'s construction/acquisition
> standards for public housing development. The replacement housing may
> be provided either through direct replacement of units,
> construction/acquisition, or transfer to the PHA under the turnkey
> method;

e)  *Other laws*. HUD will consider whether, if it consents to the
    taking, such consent would violate or lead directly to the violation
    of other federal laws or regulations.

f)  *Compensation for Vacant Land, Non-Dwelling Structures, and
    Facilities Taken.* The Taking Body may provide either monetary
    compensation or actual replacements for vacant land, non-dwelling
    structures, non-dwelling spaces and other facilities (such as
    community buildings, administrative offices, basketball courts,
    playgrounds, maintenance facilities, etc) that are lost to the PHA
    and its residents as a result of the taking. If the Taking Body is
    providing monetary compensation, HUD staff may base its
    consideration of the adequacy of compensation on the cost of (i)
    developing or acquiring replacement structures/facilities, or (ii)
    the FMV of the structures/facilities taken;

g)  *Compensation for Severance Damages.* As a factor in determining
    whether to consent to a taking, HUD may also consider whether the
    Taking Body should provide the PHA with compensation for severance
    damages, which should include any loss of assessed value caused by a
    partial taking of a parcel of public housing property. Severance
    damages may also include compensation for any mitigation or
    reconstruction costs required to correct any damage to public
    housing property caused by the taking;

h)  *Appraisal of the FMV of the Public Housing Property.* The FMV of
    the public housing property being taken should be determined by an
    independent state-licensed or state-certified appraiser. The Taking
    Body, with HUD\'s approval, may use other independent means to
    determine the FMV of the public housing property proposed to be
    taken if the PHA and/or Taking Body can show that obtaining an
    appraisal would not be economical. In addition, pursuant to the
    Uniform Relocation Assistance and Real Property Acquisition Policies
    Act of 1970 (URA) and its implementing regulations at 49 CFR
    24.102(c)(2), a waiver valuation may be used instead of an appraisal
    if HUD, in its sole discretion, determines that an appraisal is
    unnecessary;

i)  *Resident Consultation*. HUD will not consent to a taking of public
    housing property unless the residents of the affected Development
    have been notified of the taking (by either the Taking Body or the
    PHA), as required by any applicable Federal, State and local law;

j)  *Evidence that the Taking Body Will Pay for the Costs of Relocating
    the Residents to Comparable Housing for any Displacement that Occurs
    as a Result of the Taking.* When the proposed taking is of a
    federally assisted development, any resulting displacement is
    subject to the URA. It is the responsibility of the Taking Body to
    ensure it is in compliance with all applicable URA requirements.
    When the proposed taking is not a federally assisted development,
    but includes a building with occupied units, the Taking Body must
    nonetheless provide relocation and housing assistance to the
    residents of that building that is equivalent to the assistance
    required under the URA. An agreement between the Taking Body and the
    residents, pursuant to which the residents agree not to challenge
    the eminent domain action in exchange for the type of relocation
    assistance described in the preceding sentences, will enhance the
    likelihood that HUD will consent to the taking;

k)  *Satisfaction of all Applicable Environmental and Historic
    Preservation Requirements for the Public Housing Property and any
    Replacement Units.* Before HUD releases its interest in a public
    housing property to a Taking Body, HUD must conduct an environmental
    review in accordance with 24 CFR part 50 to satisfy the requirements
    of the National Environmental Policy Act (NEPA) of 1969 (42 U.S.C.
    4321 et seq.), the National Historic Preservation Act of 1966 (16
    U.S.C. 470 et seq.) and other related laws. The environmental review
    under 24 CFR part 50 must include an inquiry into and review of any
    intended re-use of the public housing property. HUD may use
    information provided by the PHA or Taking Body to conduct the
    environmental review; and

l)  *HUD Site and Neighborhood Standards Shall Apply to All Replacement
    Properties Irrespective of the Manner of Development (e.g.,
    Acquisition or Construction).* The local HUD Office of Public
    Housing shall conduct a site and neighborhood standards review of
    all proposed replacement properties in accordance with 24 CFR 941
    and/or other HUD regulation(s), as applicable.

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6.  **Acquiring HUD Consent.**

    HUD's determination to consent to a taking will be based on
    information provided from the PHA (and Taking Body) describing the
    proposed action*.* If the PHA's ability to carry out its mission is
    threatened by an eminent domain action, the PHA should notify the
    HUD Regional/Field Counsel and the HUD Director of Public Housing in
    its jurisdiction of the proposed taking. In all other cases, at the
    time the Taking Body has either asked the Field Office for HUD's
    consent to a taking or has taken the first step required under state
    law for a taking by eminent domain to occur (see 24 CFR
    970.3(b)(8)), the PHA should submit an electronic application via
    the PIH Information Center (PIC) to HUD's Special Applications
    Center (SAC). The PHA's request for HUD consent should include all
    requested attachments (including documentation from the Taking
    Body). The SAC will then forward the request and its recommendation
    to the Assistant Secretary for Public and Indian Housing.

    The SAC will review the PHA's request for HUD consent to the taking,
    along with all accompanying information. The SAC will consult the
    HUD Regional Counsel in the jurisdiction where the public housing
    property is located. After reviewing relevant state law, considering
    all local conditions, and consulting the applicable HUD Director of
    Public Housing, the Regional Counsel shall submit recommendations to
    the SAC. Regional counsel and the SAC are encouraged to consult with
    HUD's Office of Litigation. If the taking is acceptable to the SAC,
    that office will prepare a recommendation indicating that HUD should
    consent to the taking. If the taking is not acceptable to HUD, the
    SAC will prepare a recommendation indicating that HUD should not
    consent to the taking. The Office of General Counsel will be
    included in the concurrences for all HUD consent letters involving
    takings. The Assistant Secretary for Public and Indian Housing (or
    other Headquarters Office of Public Housing official with delegated
    authority) shall make the final decision and notify the PHA.

7.  **PIC Requirements**. The SAC will inform local HUD Offices of
    Public Housing of all HUD consents to takings of public housing
    property. Local HUD Offices of Public Housing will be responsible
    for the implementation of the takings and for reporting the actual
    data in PIC.

8.  **Paperwork Reduction Act.** The information collection requirements
    contained in this document are approved by the Office of Management
    and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C
    2501-3520). The OMB control number is 2577-0075. In accordance with
    the Paperwork Reduction Act, HUD may not conduct or sponsor, and a
    person is not required to respond to, a collection of information
    unless the collection displays a currently valid OMB control number.

9.  **Technical Assistance**. Technical Assistance is available for PHAs
    from the SAC and from HUD Offices of Public Housing.

> U.S. Department of HUD
>
> Special Applications Center
>
> 77 West Jackson Blvd.
>
> Chicago, IL 60604
>
> \(312\) 353-6236
>
> http://www.hud.gov/sac

[/s/]{.underline}

Paula O. Blunt, Deputy Assistant Secretary for

Public and Indian Housing