STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

MR. AND MRS. FRED M. ANDERSON, )

)

Petitioner, )

)

vs. ) CASE NO. 82-3215

) DEPARTMENT OF TRANSPORTATION, )

)

Respondent. )

)

FINDINGS OF FACT, CONCLUSIONS OF LAW AND RECOMMENDED ORDER

Pursuant to notice, a formal administrative hearing was conducted in this matter on March 17, 1983, in Live Oak, Florida. The following appearances were entered: James W. Prevatt, Jr., Live Oak, Florida, appeared on behalf of the Petitioners, Mr. and Mrs. Fred M. Anderson; and Charles G. Gardner, Tallahassee, Florida, appeared on behalf of the Respondent, Department of Transportation.

The Department of Transportation has determined that the Petitioners are entitled to replacement housing payments in the amount of $1,206 because they were displaced from their property in connection with the construction of a highway. Petitioners contend that they are entitled to $9,550 in replacement housing payments. Petitioners have requested a formal administrative hearing. The matter was forwarded to the Division of Administrative Hearings on November 20, 1982. The final hearing was originally scheduled to be conducted on February 25, 1983. Petitioners moved for a continuance, and the hearing was rescheduled to be conducted as set out above.

The Department of Transportation filed a Motion to Dismiss the request for hearing on the grounds that Mr. Fred M. Anderson was not originally a party.

The motion was withdrawn when Mr. Fred M. Anderson was added as a party at the hearing. The Petitioner Mrs. Fred M. Anderson testified as a witness on her own behalf and called the following additional witnesses: Tracy Graff, a district relocation administrator employed by the Department; George W. Cory, III, a residential building contractor; and Charles Howes, a real estate broker. The Respondent called the following witnesses: Mamie L. Smith, an assistant district relocation administrator employed by the Department; Everett Sutton, a Right-of-Way Specialist I employed by the Department; and Ronald Allen Crew, a district relocation administrator employed by the Department. Petitioners' Exhibits 1 through 4, 6, 7, 8, and 12 through 15, and Respondent's Exhibits 1 through 10 were offered into evidence and received.

The parties have submitted post-hearing legal memoranda including proposed findings of fact and conclusions of law. The proposed findings and conclusions have been adopted only to the extent that they are expressly set out in the Findings of Fact and Conclusions of Law which follow. The proposed findings and conclusions have been otherwise rejected as not supported by the evidence, contrary to the better weight of the evidence, irrelevant to the issues, or legally erroneous.

ISSUES

The issue to be resolved in this proceeding is the amount of replacement housing payment that the Petitioners should receive as a result of their being displaced by a highway construction project. The parties agree that Petitioners are entitled to benefits, but disagree as to the appropriate amount.

FINDINGS OF FACT

1. In 1979, Petitioners owned and lived on property located in Hillsborough County, Florida. The property included slightly more than two acres of land and a one-story frame dwelling. The dwelling contained three bedrooms, a living-dining room, a kitchen, and two open porches.

   
   

2. Petitioners' property was condemned by the Florida Department of Transportation in order to obtain right-of-way for Interstate Highway 75. The value of the land and dwelling structure was $60,950, and Petitioners were awarded this amount through a Final Judgment entered in a condemnation proceeding. The value of the Petitioners' dwelling structure was approximately

   $33,794, and the value of their property was approximately $27,206. The fact that these amounts do not coincide with the condemnation award is not material.

   
   

3. Department of Transportation personnel located a comparable piece of property that included a dwelling structure. This dwelling structure was slightly larger and included some amenities that the Petitioners' condemned dwelling structure did not include. The structure was on three acres of land, more than the land included in the condemned parcel. The selling price of this comparable property and structure was $70,500.

   
   

4. Petitioners decided against purchasing the comparable property and structure located by the Department. Instead, Petitioners decided to purchase property located near to Live Oak, Florida, and to build a new dwelling structure on the property. The parcel that Petitioners purchased is 41 acres in size and includes frontage on the Suwannee River.

   
   

5. The Petitioner Mrs. Fred Anderson has contracted to construct a dwelling structure on a portion of the purchased property. The price of the dwelling is $35,000. The structure which Mrs. Anderson has contracted to build contains some amenities beyond those that were included in the condemned dwelling structure. Nonetheless, the Department has conceded that the structure, now under construction, is comparable to the condemned structure. The Department has conceded that Petitioners are entitled to receive the difference between the value placed on the condemned structure and the cost of building the new, comparable structure as a part of their replacement housing payment. This amounts to $1,206 ($35,000 minus $33,794)

   
   

6. In making a determination as to the amount of replacement housing payment that Petitioners are entitled to receive in connection with their property acquisition, the Department determined to place a value on three acres of the 41-acre tract that Petitioners purchased. Three acres were chosen because the comparable property located by the Department included three acres. The Department's personnel concluded that the three acres surrounding the dwelling structure site had a value of $8,597 per acre. The total value of the three-acre homesite was thus placed at $25,791. This amount is less than the

   $27,206 that was determined to be the fair value of the Petitioners' condemned land. The Department's personnel therefore concluded that Petitioners were

   entitled to no relocation assistance benefits for the property acquisition since they had received more money in the condemnation proceeding than the value of the three-acre homesite.

   
   

7. In determining a fair value to be placed on the property purchased by Petitioners near Live Oak, it is not appropriate to consider the price of the entire 41-acre tract. The 41-acre tract cannot fairly be compared to the condemned tract that was less than three acres in size. Petitioners should receive compensation only for a comparable tract. Petitioners paid a total of

   $58,000 for the 41-acre tract. It would not be appropriate to place a value on the three acres surrounding the Petitioners' dwelling under construction by simply dividing 41 into the total purchase price. The three acres surrounding the homesite includes river frontage. It is the most valuable portion of the 41-acre tract. While the three acres surrounding the dwelling structure under construction include amenities that the Petitioners' condemned land did not include, it is fairly comparable. The fair value of the three acres is $10,782 per acre, or a total of $32,346. It thus cost the Petitioners more than the amount they received for their condemned land ($27,206) to obtain a comparable

   homesite. The Department's calculations which led to a value of $8,597 per acre were erroneous.

   
   

8. During the course of negotiations between the Petitioner Mrs. Anderson and personnel of the Department of Transportation, Mrs. Anderson came to an understanding that she would receive $9,550 (the difference between the price of the comparable property located by the Department and the Petitioners' condemned property) in replacement housing payments. She relied on this understanding in contracting to have a dwelling structure constructed on her newly acquired property. The new dwelling structure has not been completed because Mrs. Anderson was relying upon receipt of the replacement housing payments to pay for construction. While it is clear that Mrs. Anderson had this understanding, it does not appear that the Department misrepresented any facts so as to lead her to that conclusion. Communications forwarded by the Department to Petitioners advised them that the maximum benefits they could receive would be determined by subtracting the value of their property as determined in a condemnation proceeding from the cost of comparable property. Petitioners concede that that amount is $9,550. The Department's communications clearly indicated that if Petitioners decided to purchase other property or to build a new dwelling structure, other compensation formulas would be utilized, but that the maximum possible benefit would remain $9,550.

   
   

9. While Mrs. Anderson's new dwelling structure was being constructed, she had difficulty contacting the Department's officials, who were located in Tampa and Bartow. The difficulty in communication was in part the fault of Mrs. Anderson and in part the fault of the Department's officials. Mrs. Anderson went to a Department office near Live Oak and discussed the matter. The Live Oak officials, of course, had no knowledge of the details of the matter, but helped to communicate with officials in Tampa and Bartow. During these discussions, the officials in Live Oak assumed that Mrs. Anderson was entitled to receive the amount that she related to them ($9,550). No representations were made to her, however, that would properly lead her to a conclusion that she was entitled to receive that amount. The contractor who was building Mrs. Anderson's dwelling structure also contacted Department personnel. He, too, came to the conclusion that Mrs. Anderson would be receiving $9,550. Based on that understanding, he engaged in construction activities that Mrs. Anderson could not afford. While it is apparent that the contractor reached this understanding, it does not appear that anyone at the Department directly

   represented to him that Mrs. Anderson would be receiving $9,550 in replacement housing payments.

   
   

   CONCLUSIONS OF LAW

   
   

10. The Division of Administrative Hearings has jurisdiction over the parties and the subject matter of this proceeding. Section 120.57(1), Florida Statutes.

    
    

11. Under federal law, certain persons displaced by federal highway programs are entitled to receive replacement housing benefits beyond the fair value of the property determined in a condemnation proceeding. See: Public Law 91-646, 203 (a)(1). The Florida Department of Transportation acts as the agent for the Federal Government in distributing these benefits for federal highway programs in Florida. The Department has adopted a right-of-way manual which sets the standards to be applied in determining the amount of replacement housing benefits. The manual has been incorporated by reference into the Florida Administrative Code as a rule. See: Chapter 14-15.05, Florida Administrative Code.

    
    

12. The maximum benefits that a displaced person can receive is the amount which, when added to the amount for which the Department acquired the dwelling, equals the actual cost which the displaced person is required to pay for a decent, safe, and sanitary dwelling, or the amount necessary to purchase a comparable dwelling. In this instance, the amount that Petitioners would have needed to purchase a comparable dwelling was $70,500. The condemnation award was $60,950. Thus, the maximum replacement housing payment that Petitioners could have received was $9,550.

    
    

13. If a displaced person chooses to construct a new dwelling structure rather than to accept a comparable dwelling structure, the replacement housing benefit is limited by costs necessary to construct a comparable dwelling and costs necessary to acquire comparable property. See: Paragraph 4.4.3, Right- of-Way Manual. Petitioners purchased land which was not comparable to the condemned property. A portion of the purchased land can, however, be taken out of the total parcel and considered comparable. That portion of the parcel would have cost $32,346 to purchase. The comparable structure being constructed by Mrs. Anderson costs $35,000. Thus, the total amount extended by Petitioners to obtain a comparable homesite and dwelling structure is $67,346. The value of the condemned property as determined in the condemnation proceeding was $60,950. Petitioners are therefore entitled to receive a total of $6,396 as a replacement housing payment. They have already received $1,206, which the Department of Transportation determined to be an appropriate payment. They are therefore entitled to receive an additional $5,190.

    
    

14. Petitioners have contended that the Department should be estopped from awarding a replacement housing payment of less than $9,550. This contention is without merit. No official of the Department made any representation to Petitioners that entitled them to rely upon such an award.

RECOMMENDED ORDER

Based upon the foregoing Findings of Fact and Conclusions of Law, it is, hereby,

RECOMMENDED:

That a final order be entered by the Department of Transportation finding that the Petitioners are entitled to receive a replacement housing payment of

$6,396 less the $1,206 that they have already received, and that the Department issue a replacement housing payment to the Petitioners in the amount of $5,190.

RECOMMENDED this 10th day of June, 1983, in Tallahassee, Florida.

G. STEVEN PFEIFFER Hearing Officer

Division of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32301

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 10th day of June, 1983.

COPIES FURNISHED:

James W. Prevatt, Jr., Esquire Airth, Sellers, Lewis & Decker Post Office Box 8

Live Oak, Florida 32060

Charles G. Gardner, Esquire Department of Transportation Haydon Burns Bldg., M.S. 58 Tallahassee, Florida 32301-8064

Mr. Paul N. Pappas Secretary

Department of Transportation Haydon Burns Building Tallahassee, Florida 32301

=================================================================

AGENCY FINAL ORDER

=================================================================

STATE OF FLORIDA DEPARTMENT OF TRANSPORTATION

MR. AND MRS. FRED M. ANDERSON,

Petitioner,

vs. CASE NO. 82-3215

DEPARTMENT OF TRANSPORTATION,

Respondent.

/

FINAL ORDER

The record in this proceeding has been reviewed together with the Recommended Order of the Hearing Officer, copy attached.

The Exceptions to the Recommended Order submitted by Petitioners have been considered. Petitioners allege error by the Hearing Officer in finding that the Petitioners have already received the sum of $1,206.00 from the Department of Transportation. Petitioners are correct; this is the sum the Department found the Petitioners entitled to, but no payment was ever actually made.

The Findings of Fact of the Hearing Officer are supported by the record with the exception noted above; the Conclusions of Law are considered correct. The Recommended Order is adopted and made a part of this order with the finding of prior payment of $1,206.00 deleted. The Department will issue a replacement housing payment to the Petitioners in the amount of $6,396.00.

DONE AND ORDERED this 10th day October, 1983.

PAUL N. PAPPAS SECRETARY

DEPARTMENT OF TRANSPORTATION HAYDON BURNS BUILDING TALLAHASSEE, FLORIDA 32301-8064

COPIES FURNISHED:

G. STEVE PFEIFFER, ESQUIRE Hearing Officer

Divisions of Administrative Hearings The Oakland Building

2009 Apalachee Parkway

Tallahassee, Florida 32301

JAMES W. PREVATT, JR., ESQUIRE

Airth, Sellers, Lewis & Decker Post Office Box 8

Live Oak, Florida 32060

CHARLES G. GARDNER, ESQUIRE

Department of Transportation Haydon Burns Building Tallahassee, Florida 32301-8064

Docket for Case No: 82-003215

Orders for Case No: 82-003215