B-104995, APRIL 29, 1952, 31 COMP. GEN. 540

B-104995: Apr 29, 1952

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RIGHTS-OF WAY AND EASEMENTS FOR LEVEES EXPENDITURES WHICH ARE MADE BY LEVEE DISTRICTS IN PROVIDING LANDS. THE AMENDMENT TO THE SAID ACT LIMITING SUCH REIMBURSEMENTS TO THE ACTUAL MARKET VALUE DOES NOT REQUIRE REDUCTIONS OF ESTIMATED SALVAGE VALUE OF IMPROVEMENTS ON THE LAND WHICH ARE MOVED RATHER THAN ACQUIRED BY THE UNITED STATES. ARE GOVERNED BY PARAGRAPH (D) OF SECTION 3 OF THE ACT OF AUGUST 18. 55 STAT. 643 (33 U.S.C. 7022-12 (D) ( THAT IS. SUCH REIMBURSEMENTS ARE LIMITED TO THE ACTUAL MARKET VALUE. THAT IS. IT IS STATED IN YOUR LETTER THAT PURSUANT TO LOCAL CUSTOM AND LEGAL PROCEDURE ESTABLISHED THROUGH MANY YEARS OF PRECEDENT. IT IS STATED THAT THE APPRAISALS OF THE VALUE OF THE RIGHTS-OF-WAY MADE BY THE DISTRICT AND THE GOVERNMENT WERE IDENTICAL.

B-104995, APRIL 29, 1952, 31 COMP. GEN. 540

PROPERTY - PRIVATE - REIMBURSEMENT FOR EXPENDITURES FOR LANDS, RIGHTS-OF WAY AND EASEMENTS FOR LEVEES EXPENDITURES WHICH ARE MADE BY LEVEE DISTRICTS IN PROVIDING LANDS, RIGHTS -OF-WAY OR EASEMENTS REQUIRED FOR SET-BACKS OF MISSISSIPPI RIVER LEVEES, MAY BE REIMBURSED IN AMOUNTS FOUND BY CHIEF OF ENGINEERS TO BE REASONABLE IN ACCORDANCE WITH LOCAL LEGAL PROCEDURE OR CUSTOM, AS PROVIDED IN THE ACT OF AUGUST 18, 1941, AND THE AMENDMENT TO THE SAID ACT LIMITING SUCH REIMBURSEMENTS TO THE ACTUAL MARKET VALUE DOES NOT REQUIRE REDUCTIONS OF ESTIMATED SALVAGE VALUE OF IMPROVEMENTS ON THE LAND WHICH ARE MOVED RATHER THAN ACQUIRED BY THE UNITED STATES.

COMPTROLLER GENERAL WARREN TO THE SECRETARY OF THE ARMY, APRIL 29, 1952:

CONSIDERATION HAS BEEN GIVEN TO YOUR LETTER OF SEPTEMBER 21, 1951, WITH ENCLOSURES, REQUESTING A DECISION AS TO WHETHER REIMBURSEMENTS TO LEVEE DISTRICTS FOR EXPENDITURES MADE IN PROVIDING LANDS, RIGHTS-OF-WAY OR EASEMENTS FOR LEVEE AND RELATED WORKS, ARE GOVERNED BY PARAGRAPH (D) OF SECTION 3 OF THE ACT OF AUGUST 18, 1941, 55 STAT. 643 (33 U.S.C. 7022-12 (D) ( THAT IS, TO ACTUAL EXPENDITURES FOUND REASONABLE, OR WHETHER IN VIEW OF THE AMENDMENT TO THAT STATUTE CONTAINED IN THE ACT OF DECEMBER 22, 1944, 58 STAT. 894, SUCH REIMBURSEMENTS ARE LIMITED TO THE ACTUAL MARKET VALUE, THAT IS, THE APPRAISED VALUE LESS SALVAGE VALUE OF IMPROVEMENTS RETAINED BY THE OWNERS AFFECTED.

IT IS STATED IN YOUR LETTER THAT PURSUANT TO LOCAL CUSTOM AND LEGAL PROCEDURE ESTABLISHED THROUGH MANY YEARS OF PRECEDENT, THE LEVEE DISTRICT, HEREINAFTER REFERRED TO AS THE DISTRICT, APPROPRIATED THE NECESSARY LANDS REFERRED TO IN YOUR LETTER; THAT IT NEGOTIATED WITH THE OWNERS FOR REIMBURSEMENT THEREFOR; AND THAT IT PROCEEDED WITH ARRANGEMENTS FOR MOVING THE IMPROVEMENTS. FURTHER, IT IS STATED THAT THE APPRAISALS OF THE VALUE OF THE RIGHTS-OF-WAY MADE BY THE DISTRICT AND THE GOVERNMENT WERE IDENTICAL, NAMELY, $5,395; THAT THE DISTRICT ADVERTISED FOR THE REMOVAL OF THE IMPROVEMENTS AND AWARDED THE CONTRACT FOR SAME FOR $17,975; THAT IN ADDITION, OWNERS OF TRACTS 3A AND 12 MOVED THEIR IMPROVEMENTS AT COSTS OF $205 AND $850, RESPECTIVELY, OR A TOTAL REMOVAL COST OF $19,030; THAT THE GOVERNMENT'S APPRAISAL OF ALL THE IMPROVEMENTS WAS $19,125, WITH AN ESTIMATED SALVAGE VALUE OF $1,955, OR A NET VALUE OF $17,170; AND THAT THE SUM OF $1,860 REPRESENTS THE DIFFERENCE BETWEEN THE ACTUAL COST TO THE DISTRICT FOR THE REMOVAL OF THE IMPROVEMENTS AND THE GOVERNMENT'S APPRAISAL OF SAME, LESS SALVAGE VALUE.

IT APPEARS FROM THE BRIEFS PREPARED BY THE BOARD OF COMMISSIONERS FOR THE DISTRICT AND THE PRESIDENT, MISSISSIPPI RIVER COMMISSION, AS SUPPLEMENTED BY ORAL ARGUMENTS AND ADDITIONAL DATA SUBMITTED TO THIS OFFICE BY A REPRESENTATIVE OF THE BOARD THAT THE DISTRICT TAKES THE POSITION THAT THE ONLY AUTHORITY FOR AFFECTING REIMBURSEMENT IS CONTAINED IN PARAGRAPH (D) OF SECTION 3 OF THE FLOOD CONTROL ACT OF 1941, SUPRA, THAT IS, ON THE BASIS OF "ACTUAL EXPENDITURES * * * FOUND BY THE CHIEF OF ENGINEERS TO BE REASONABLE" WHICH DOES NOT NECESSITATE ANY DEDUCTION FOR THE SALVAGE VALUE OF IMPROVEMENTS IN CASES WHERE THERE IS IN FACT NO TAKING OF THE IMPROVEMENTS AND TITLE THERETO CONTINUES IN THE OWNER.

IN SUPPORT OF THE ARGUMENTS ON BEHALF OF THE DISTRICT, IT IS POINTED OUT THAT UNDER THE LAW OF LOUISIANA--- AS TO WHICH SEE DANZIGER V. UNITED STATES, 93 F.1SUPP. 70--- THE RIPARIAN OWNER ALONG NAVIGABLE STREAMS HOLDS HIS LAND SUBJECT TO A SERVITUDE FOR LEVEE PURPOSES AND THAT THE LAW AUTHORIZES THE APPROPRIATION OF PROPERTY FOR SUCH PURPOSES AND PAYMENT THEREFOR AT A PRICE NOT TO EXCEED THE ASSESSED VALUE. IN THE LATTER CONNECTION, IT IS URGED THAT THE SOLE PURPOSE OF THE AFORESAID AMENDMENT TO THE ORIGINAL ACT WAS TO AUTHORIZE PAYMENT OF THE ACTUAL MARKET VALUE AS ,REASONABLE" REGARDLESS OF THE STATE LAW LIMITING PAYMENTS FOR PROPERTY TAKEN TO LOCAL TAX ASSESSMENT VALUES, A PROCEDURE CONSISTENT WITH THE COURT'S FINDING IN THE CASE OF TILDEN V. UNITED STATES, 10 F.1SUPP. 377. IT IS POINTED OUT THAT UNDER THE PREVAILING PROCEDURE IN LOUISIANA, THE OWNER IS NOT PAID FOR THE VALUE OF THE IMPROVEMENTS; THAT IN FACT HE IS PAID NOTHING FOR IMPROVEMENTS WHATSOEVER; THAT THE LEVEE BOARD, UTILIZING THE COMPETITIVE BIDDING SYSTEM, AWARDS A CONTRACT--- TO WHICH THE OWNER IS NOT A PARTY--- FOR THE REMOVAL OF THE BUILDINGS AND IMPROVEMENTS FROM THE RIGHT-OF-WAY AND RELOCATION OF SAME AND THAT ACCORDINGLY THERE SHOULD BE NO DEDUCTION FOR SALVAGE VALUE. WITH RESPECT TO THIS PARTICULAR INSTANCE, IT IS STATED THAT IT IS THE ACCEPTED PRACTICE TO REESTABLISH UTILITIES SUCH AS ROADS, HIGHWAYS, POWER LINES, RAILROADS, ETC., WITHOUT ADDITIONAL COST TO THE OWNERS EXCEPT FOR BETTERMENTS AND THAT THERE IS NO REASON WHY THE SAME PRACTICE SHOULD NOT OBTAIN IN MOVING IMPROVEMENTS SUCH AS HERE INVOLVED.

CONCERNING THE MANNER IN WHICH APPRAISALS FOR LANDS AND IMPROVEMENTS FOR FLOOD CONTROL PURPOSES ACTUALLY ARE MADE, THERE HAS BEEN FORWARDED FOR USE IN CONSIDERATION OF THE MATTER, COPY OF LETTER OF NOVEMBER 14, 1951, FROM THE DISTRICT ENGINEER AT NEW ORLEANS SETTING FORTH THE VARIOUS METHODS EMPLOYED IN MAKING OF APPRAISALS AND STATING THAT IN ADDITION HE HAS RECENTLY INSTITUTED THE PRACTICE OF MAKING ENGINEERING ESTIMATES OF THE FAIR AND REASONABLE COST FOR REMOVING AND RELOCATING THE IMPROVEMENTS ON A NEW SITE IN INSTANCES WHEN SUCH ACTION IS PROPOSED BY THE LEVEE BOARD AFTER COMPETITIVE BIDDING IN ACCORDANCE WITH LOCAL PROCEDURE AND CUSTOM; THAT THE "APPRAISED VALUE," "ESTIMATED SALVAGE VALUE" AND THE ENGINEERING ESTIMATE OF THE FAIR AND REASONABLE COST OF MOVING THE IMPROVEMENTS ARE NOW ALL CONSIDERED IN DETERMINING THE REASONABLENESS AND LEGAL SUFFICIENCY FOR REIMBURSEMENT OF THE COST TO THE LEVEE BOARD FOR PROVIDING RIGHTS-OF- WAY; AND THAT IN 1946, WHEN THE INSTANT RIGHT-OF-WAY WAS REQUIRED, ONLY AN APPRAISAL OF THE FAIR MARKET VALUE AND AN ESTIMATE OF THE SALVAGE VALUE WERE MADE; AND THAT THE PRACTICE OF PREPARING AN ENGINEERING ESTIMATE OF THE MOVING COST HAD NOT BEEN ESTABLISHED AT THAT TIME.

PARAGRAPH (D) OF SECTION 3 OF THE AFORESAID ACT OF AUGUST 18, 1941, 55 STAT. 643, AND THE AMENDMENT CONTAINED IN SAID ACT OF DECEMBER 22, 1944, 58 STAT. 894, PROVIDE AS FOLLOWS:

THE CHIEF OF ENGINEERS, WITH APPROVAL OF THE SECRETARY OF WAR (NOW SECRETARY OF THE ARMY) SHALL REIMBURSE LOCAL AUTHORITIES FOR ACTUAL EXPENDITURES FOUND BY THE CHIEF OF ENGINEERS TO BE REASONABLE, FOR PROVIDING AT THE REQUEST OF THE UNITED STATES, IN ACCORDANCE WITH LOCAL LEGAL PROCEDURE OR CUSTOM, RIGHTS-OF-WAY AND FLOWAGE EASEMENTS REQUIRED FOR FUTURE SET-BACKS OF MAIN-LINE MISSISSIPPI RIVER LEVEES.

PARAGRAPH (D) OF THE LOWER MISSISSIPPI RIVER ITEM IN SECTION 3 OF THE FLOOD CONTROL ACT OF AUGUST 18, 1951, IS HEREBY CONSTRUED TO AUTHORIZE REIMBURSEMENT FOR THE ACTUAL MARKET VALUE OF LANDS, RIGHTS OF-WAY, AND EASEMENTS, FURNISHED SUBSEQUENT TO AUGUST 18, 1941, FOR SET-BACKS OF MAIN- LINE MISSISSIPPI RIVER LEVEES, REGARDLESS OF STATE LAWS LIMITING PAYMENTS TO LOCAL TAX ASSESSMENT VALUATIONS.

IT APPEARS CLEAR FROM THE LEGISLATIVE HISTORY OF THE INVOLVED PROVISIONS OF THE 1944 STATUTE THAT THE AMENDMENT WAS INTENDED TO OPERATE MERELY AS AN AMPLIFICATION OF THE ORIGINAL ACT OF 1941, TO PERMIT REIMBURSEMENT TO THE LOCAL AUTHORITIES ON THE BASIS OF "ACTUAL MARKET VALUE" REGARDLESS OF STATE LAWS LIMITING PAYMENTS TO LOCAL TAX ASSESSMENT VALUATIONS. SEE PAGE 10, HOUSE REPORT 2051, 78TH CONGRESS, OF CONFERENCE ON H.R. 4485 WHICH BECAME THE ACT OF DECEMBER 22, 1944, 58 STAT. 894. ACCORDINGLY, SINCE UNDER THE 1941 ACT THE DISTRICT IS ENTITLED TO REIMBURSEMENT BY THE UNITED STATES FOR THE "ACTUAL EXPENDITURES FOUND BY THE CHIEF OF ENGINEERS TO BE REASONABLE" IN ACCORDANCE WITH LOCAL LEGAL PROCEDURE OR CUSTOM, AND THE 1944 AMENDMENT WAS NOT INTENDED TO EFFECT ANY CHANGE THEREIN WHERE THE IMPROVEMENTS ARE MOVED RATHER THAN ACQUIRED BY THE UNITED STATES THE SAID CHIEF OF ENGINEERS WITH THE APPROVAL OF THE SECRETARY OF THE ARMY PROPERLY MAY REIMBURSE THE DISTRICT FOR THE ACTUAL COST OF MOVING OF THE INVOLVED IMPROVEMENTS WITHOUT DEDUCTION FOR THE ESTIMATED SALVAGE VALUE. DANZIGER V. UNITED STATES, SUPRA. CF. CENTRAL POWER AND LIGHT CO. V. WILLACY COUNTY, 14 S.W. 2D 102; CITY OF SAN ANTONIO V. FIKE, 224 S.W. 911.