STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

PATRICK MEDIA GROUP INC., )

)

)

Petitioner, )

)

vs. ) CASE NO. 91-3807T

) DEPARTMENT OF TRANSPORTATION, )

)

)

Respondent. )

)

RECOMMENDED ORDER

Pursuant to notice, the Division of Administrative Hearings, by its duly designated Hearing Officer, K. N. Ayers, held a formal hearing in the above- styled case on March 3, 1992, at Tampa, Florida.

APPEARANCES

For Petitioner: Elizabeth G. Repaal, Esquire

Post Office Box 1441

St. Petersburg, FL 33731

For Respondent: Charles G. Gardner, Esquire

605 Suwannee Street

Tallahassee, FL 32399-0450 STATEMENT OF THE ISSUES

What compensation is Petitioner entitled to for its sign located on property condemned by Respondent for road improvement purposes?

PRELIMINARY STATEMENT

This case originated when Respondent failed to join Patrick Media Group Inc. in the condemnation proceedings to acquire additional right of way for highway improvement when Patrick Media owned three signs located on the condemned real property. By Petition For Formal Proceedings forwarded to the Department of Transportation (DOT) on June 3, 1991, Patrick Media requested a formal hearing to obtain compensation in the amount of four times its billing for the outdoor advertising signs which are not able to be relocated.

This case was initially scheduled to be heard September 4, 1991, but was continued when Patrick Media filed inverse condemnation proceedings in the Circuit Court in Hillsborough County.

By Order entered November 22, 1991, the Circuit Court stayed those proceedings until Petitioner exhausted its administrative remedies. These

proceedings were reopened, and by Notice Of Hearing dated December 9, 1991 the case was scheduled for and heard on March 3, 1992.

At the commencement of the hearing, the parties had limited these proceedings to compensation allowable for the one sign which could not be relocated and Stipulated to findings 1-7 below. Thereafter, Petitioner called one witness, Respondent called one witness, and two exhibits were admitted into evidence. There is no dispute regarding the operable facts here involved, and accordingly, proposed findings submitted by the parties are accepted. Those proposed findings not included below were deemed unnecessary to the conclusions reached. The sole issue here is the proper method to be used to determine the value of the sign in question.

FINDINGS OF FACT

1. The property on which the structure was located was acquired by the Department of Transportation (DOT) for roadway purposes.

   
   

2. The project was part of a federal program for road improvement.

   
   

3. The structure in controversy is an outdoor advertising sign owned by Patrick Media.

   
   

4. Relocation benefits were offered by the DOT pursuant to the Federal Uniform Relocation Act.

   
   

5. This sign was a legal nonconforming sign at the time of taking.

   
   

6. Patrick Media had a leasehold interest in the site on which the sign was located.

   
   

7. Patrick Media has removed the structure.

   
   

8. The structure in question was comprised of two facings (V-shaped configuration), lights, service ladders and catwalks. It was built in 1978 and has been in continuous service since that time. The site is leased on a year to year renewable basis with either party able to terminate the lease at the expiration of the lease year.

   
   

9. Contracts with advertisers involve multiple locations with price depending upon the number of motorists passing the sign per unit of time. Revenue received from face A (facing west) from August 15, 1990 to May 5, 1991 was $3739 (net) and from face B (east facing) from May 25, 1990 to May 25, 1991 was $2288 (net).

   
   

10. As a nonconforming sign, the sign could not have been rebuilt if destroyed had the site not been acquired by DOT.

    
    

11. Shortly after the introduction of Chapter 479 into the Laws of Florida and the possibility of requiring the nonconforming signs to be purchased by DOT for removal, DOT met with sign companies and developed a format for determining compensation to be paid for removing these nonconforming signs. A copy of the format completed for the sign in issue here was admitted as Exhibit 1. (Form 178-507 4/83)

12. Additionally, Comparative Cost Multipliers (Exhibit 2) is used to determine the inflation caused adjustment to be applied to structures built in earlier years.

    
    

13. Exhibit 1 computed the estimated value of the sign in issue at

    $11,674.53. However, this compensation did not include catwalks or time clock.

    
    

14. The removed sign has negligible salvage value.

    
    

    CONCLUSIONS OF LAW

    
    

15. The Division of Administrative Hearings has jurisdiction over the parties to, and the subject matter of, these proceedings.

    
    

16. The parties agree that the value of the structure is to be determined in accordance with the Federal Uniform Relocation Assistance Act, 42 U.S.C., Section 4652, but disagree on the interpretation of this statute.

    
    

17. DOT contends that the provisions of 42 C.F.R., 24.303(e), is applicable. This rule provides:

    
    

    Advertising Signs. The amount of a payment

    for direct loss of an advertising sign which is personal property shall be the lesser of:

    
    

    1. The depreciated reproduction cost of the sign, as determined by the agency, less the proceeds from its sale; or

       
       

    2. The estimated cost of moving the sign, but with no allowance for storage.

       
       

18. 42 U.S.C., Section 4652, provides in pertinent part:

    
    

    (a) Notwithstanding any other provision of law, if the head of a Federal agency acquires any interest in real property in any State, he shall

    acquire at least an equal interest in all buildings, structures, or other improvements located upon the real property so acquired and which he requires to be removed from such real property or which he determines will be adversely affected by the use

    to which the real property will be put.

    
    

    (b)(1) For the purpose of determining the just compensation to be paid for any building, structure, or other improvement required to be acquired by sub- section (a) of this section, such building, structure, or other improvement shall be deemed to be a part of the real property to be acquired notwithstanding the right or obligation of a tenant, as against the

    owner of any other interest in the real property, to remove such building, structure, or improvement at the expiration of his term, and the fair market value which such building, structure or improvement contributes to the fair market value of the real property to be acquired, or the fair market value

    of such building, structure, or improvement for removal from the real property, whichever is the greater, shall be paid to the tenant therefor.

    
    

19. A careful reading of subsection (b)(1), above quoted, is the compensation to be paid of either the value the structure contributes to the fair market value of the real property; or the fair market value of the structure, whichever is the greater.

    
    

20. Although no evidence was presented regarding the contribution of this sign to the fair market value of the acquired real property, such value would be limited to the rental payments received by the owner of the real property from Patrick Media. Since this issue was not raised, it is assumed for the purpose of this Recommended Order that this factor was not considered in determining compensation to be paid for the real property; and the provisions of 42 U.S.C., Section 4652(b)(2), precluding duplication of payments for the value the structure adds to the real property; and for the fair market value of the structure, do not come into play.

    
    

21. In preparing the format completed as Exhibit 1, it is clear that DOT and the various sign companies agreed that if nonconforming signs are voluntarily or involuntarily removed in accordance with Section 479.24, Florida Statutes, which authorizes the removal of nonconforming signs upon payment of just compensation therefor, the fair value of the sign would be calculated on the factors included in Form 178-507 dated 4/83.

    
    

22. It is a well recognized rule of statutory construction that the interpretation placed on a statute by the agency charged with carrying out the provisions of that statute is entitled to great weight. Department of Insurance

    v. Southeast Volusia Hospital District, 438 So.2d 815 (Fla. 1983); Natelson v. Department of Insurance, 454 So.2d 31 (Fla. 1st DCA 1984).

    
    

23. Here the Federal Highway Administration is one agency heavily involved with land acquisitions in connection with the federal highway system; accordingly, its interpretation of 42 U.S.C., Section 4652, is entitled to great weight. This interpretation is contained in 42 C.F.R., 24.303(e), above quoted. Further, this interpretation is consistent with the agreement reached between the Florida DOT and the sign companies and embodied in Form 178-507 4/83.

    
    

24. Just compensation to be paid sign owners for the taking of the structures in condemnation proceedings was the issue in Department of Transportation v. Heathrow Land and Development Corporation et al., 479 So.2d

    183 (Fla. 5th DCA 1991). That case sustained the trial court's order that 42 U.S.C., Section 4652, controlled the compensation to be paid and that DOT could not remove the sign until it had prepared a good faith estimate of the value of the sign based on criteria in 42 U.S.C., Section 4652, and deposited such good faith estimate of the value of the sign into the registry of the court. Heathrow in no wise conflicts with the interpretation placed on 42 U.S.C., Section 4652, by the Federal Highway Administration in 42 C.F.R., 24.303(e), or the agreement reached between DOT and the sign companies on how fair value of removed nonconforming signs would be calculated.

    
    

25. From the foregoing, it is concluded that the fair value of Petitioner's sign removed from land acquired by DOT for road improvement purposes is to be determined by 42 U.S.C., Section 4652, and that the calculation provided in Form 178-507 4/83 as adjusted by Comparative Cost Multipliers complies with this statutory provision. The calculations contained

in Exhibit 1 are accurate; however, the value of catwalks and time clock should be added to the $9664.35 calculation before applying the 1.2 multiplier.

RECOMMENDATION

It is recommended that the fair value of the sign in issue be recalculated to add the value of catwalks and time clock to the total before applying the multiplier and that a Final Order be entered finding that total so calculated to be the fair market value of Patrick Media's sign.

DONE and ORDERED this 20 day of April, 1992, in Tallahassee, Florida.

COPIES FURNISHED:

Elizabeth G. Repaal, Esquire Post Office Box 1441

St. Petersburg, FL 33731

Charles G. Gardner, Esquire Department of Transportation 605 Suwannee Street

Tallahassee, FL 32399-0450

Ben G. Watts Secretary

Department of Transportation Haydon Burns Building

605 Suwannee Street

Tallahassee, FL 32399-0458 ATTN: Eleanor Turner MS 58

Thornton J. Williams General Counsel

Department of Transportation

562 Haydon Burns Building 605 Suwannee Street Tallahassee, FL 32399-0458

K. N. AYERS Hearing Officer

Division of Administrative Hearings The Desoto Building

1230 Apalachee Parkway

Tallahassee, FL 32399-1550

(904) 488-9675

Filed with the Clerk of the Division of Administrative Hearings this 20th day of April, 1992.

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

All parties have the right to submit written exceptions to this Recommended Order. All agencies allow each party at least 10 days in which to submit written exceptions. Some agencies allow a larger period within which to submit

written exceptions. You should contact the agency that will issue the final order in this case concerning agency rules on the deadline for filing exceptions to this Recommended Order. Any exceptions to this Recommended Order should be filed with the agency that will issue the final order in this case.

Docket for Case No: 91-003807

Orders for Case No: 91-003807