ance to cover such a loss was not reasonably available.

(7) The cost of removal, installation, and reestablishment of, and the reconnection of utilities for, machinery, equipment, appliances, and other items not acquired as real property, including such modifications thereof as is deemed necessary by the Secretary. Prior to the payment for any such costs in relation to such property, the displaced person must agree in writing that such property is personal and that the displacing agency is released from any liability for payment for the value of such property.

(8) Such other related expenses as the Secretary determines to be reasonable under the circumstances.

(b) When the displaced person accomplishes the move by himself or by the use of his family or employees, the amount of allowable expenses will not exceed the estimated commercial cost of such a move.

§ 15.24 Direct losses incurred in moving or discontinuing a business or farm operation.

(a) If a displaced person does not move personal property used in a business or farm operation but has made a bona fide effort to sell such personal property, he is entitled to payment for the loss of such personal property, and he may be reimbursed for expenses reasonably incurred in such a selling effort.

(b) If a business or farm operation is discontinued, a displaced person is entitled, with respect to personal property which was used in connection therewith, to a payment for what would have been its fair market value for its continued use at its location prior to displacement minus the net proceeds from its sale or, if abandoned after a bona fide effort to sell, to the estimated cost of moving it 50 miles, whichever is less. Payments to a displaced person shall not be offset by the cost to the displacing agency of removing such abandoned property.

(c) If a business or farm operation is reestablished, a displaced person is entitled, with respect to personal property which was used in connection therewith but which is not moved but rather is sold and promptly replaced

by a comparable item, to a payment for its replacement cost minus the net proceeds from its sale or the estimated cost of moving it 50 miles, whichever is less.

(d) If personal property used in a business or farm operation to be moved is of high bulk and low value and the cost of moving it would, in the judgment of the Secretary, be disproportionate to its value, the allowable expense of moving such personal property will not exceed the cost of replacing it at the relocated premises with comparable personal property available on the market minus the estimated net amount that would have been received for such personal property on liquidation. This provision is applicable to junkyard items and to stockpiled sand, gravel, minerals, metals, or similar items of personal property.

(e) If the cost of moving or relocating an outdoor advertising display is determined by the displacing agency to be equal to or in excess of the inplace value of the display, consideration should be given to acquiring such a display as a part of the real property except when such an acquisition is prohibited by law.

§ 15.25 Allowable expenses in connection with searching for a replacement location for a business or farm operation. (a) The following expenses are allowable under this subpart in connection with the searching for a replacement location for a business or farm operation:

(1) Actual travel costs but not in excess of 10 cents a mile.

(2) Cost of meals and lodging away from home.

(3) The value of time spent in searching for a replacement location for a business or farm operation, at the rate of the displaced person's salary or earnings but not in excess of $10 an hour.

(4) In the discretion of the displacing agency, such brokerage, realtor, or other professional fees in connection with relocating a business or farm operation in the area as is customary under the circumstances.

(b) The total amount allowable to a displaced person under this section

The following expenses are not allowable under this subpart in connection with the relocation of a business or farm operation:

(a) Additional expenses incurred because of living at a new location.

(b) The cost of moving structures or other improvements to real property as to which the displaced person reserved ownership, except as otherwise provided for by the Act.

(c) The cost of improvements to the replacement site, except as provided for in § 15.23.

(d) Interest on loans to cover moving and related expenses.

(e) Loss of goodwill.

(f) Loss of profits.

(g) Added expenses incurred because of a loss of trained employees.

(h) Expenses or losses resulting from personal injury.

(i) The cost of preparing applications for moving and related expenses and of preparing supporting documentation.

(j) The cost of the modification of personal property to adapt it to the replacement site, except when required by law.

(k) The cost of searching for a replacement dwelling.

(1) The cost of establishing a different or larger business or farm operation to the extent that such a cost exceeds the estimated cost of reestablishing the business or farm operation being discontinued.

Subpart E-Payments in Lieu of Actual Moving and Related Expenses

§ 15.30 Use of schedules in connection with displacement from dwelling.

A person displaced from a dwelling may at his option receive, in lieu of actual moving and related expenses for himself and his family under Subpart D of this part, a moving expense allowance, not in excess of $300, determined according to schedules established by the highway department of the State in which the acquired dwell

ing is located and approved by the Federal Highway Administrator or, in the absence of such a highway department schedule, according to schedules established by the Federal Highway Administrator, plus a dislocation allowance of $200.

§ 15.31 Fixed payment for person displaced from his place of business or farm operation.

(a) A person displaced from his place of business or farm operation may, at his option, receive, in lieu of actual moving and related expenses in that regard under Subpart D of this part but in addition to such payments as he may be entitled to for himself and his family under Subpart D of this part or § 15.30, a fixed payment in the amount of the average annual net earning before Federal, State, and local income taxes of his bona fide business or farm operation during the 2 taxable years immediately preceding the taxable year in which the business or farm operation is moved from the acquired real property or during such other period as the head of the displacing agency determines to be more equitable for establishing such average annual net earnings, including any compensation paid by the business or farm operation to the owner or his spouse or dependents during such a base period, but not less than $2,500 nor more than $10,000 in respect of any bona fide business or farm operation, except that no payment will be made under this section with respect to a business conducted primarily for assisting in the purchase, sale, resale, manufacture, processing, or marketing of products, commodities, other personal property, or services by the erection and maintenance of outdoor advertising displays.

(b) No payment may be made pursuant to this section in respect of a business unless the Secretary determines (1) that the business cannot be relocated without a substantial loss of existing patronage and (2) that the business is not a part of an enterprise with at least one other establishment which is engaged in the same or a similar business and which is not being acquired.

(c) The determination of whether there will be a substantial loss of existing patronage is to be made, except as provided for in paragraph (d) of this section, by the displacing agency after considering all pertinent circumstances, including but not limited to the following factors:

(1) The type of business conducted by the displaced person.

(2) The nature of the clientele of the displaced person.

(3) The availability of property suitable for use as a new location on which to conduct the business.

(4) The relative importance to the business of the present location and such new locations as are available.

(d) The determinations of whether there will be a substantial loss of existing patronage of an activity conducted by a nonprofit organization and of whether the activity is a part of an enterprise with at least one other establishment which is engaged in the same or a similar activity and which is not being acquired will be made by the Secretary. For this purpose, the term "existing patronage" includes the persons, community, or clientele served or affected by the activities of the nonprofit organization.

(e) A payment will be made under this section with respect to the acquisition of a part of the property used by a person for a farm operation only when the displacing agency determines that the acquired property was in fact used for a farm operation before the taking and that the remaining property cannot be expected to be so used for a farm operation and continue to contribute substantially to the operator's support.

Subpart F-Replacement Housing Payments

§ 15.35 Payments for replacement housing costs to homeowners.

(a) A person displaced from a dwelling actually owned and occupied by him for at least 180 days prior to the initiation of negotiations for the acquisition of that dwelling is entitled, in addition to entitlement to other payments under this part, to payment for the additional cost, if reasonable, of acquiring a comparable replacement

dwelling which is decent, safe, and sanitary and which he purchases and occupies within 1 year from the date he received final payment for the dwelling from which he was displaced or from the date on which he moved therefrom, whichever is later, as well as payment for additional interest costs as provided for in § 15.37.

(b) A comparable replacement dwelling is a dwelling that is functionally equivalent to, and substantially the same as, the acquired dwelling, not excluding for this purpose newly constructed housing. Each aspect of the dwellings need not be individually compared as long as all the requirements of paragraph (c) of this section are met.

(c) The additional cost of a replacement dwelling will not be regarded as unreasonable if that additional cost results from the need for acquiring a dwelling which is decent, safe, and sanitary, which is adequate to accommodate the displaced person and his family, which is located in an area not generally less desirable in respect of neighborhood conditions such as municipal services and other environmental factors, public utilities, and public and commercial facilities, which is reasonably accessible to the displaced person's place of employment or potential place of employment, which is within the financial means of the displaced person, and which is available on the private market. If such housing is not available, the displacing agency may, for purposes of this subpart and for making housing referrals, consider housing exceeding the other basic criteria.

§ 15.36 Limitation on payments for replacement housing costs.

(a) The amount of a payment for the additional cost of a replacement dwelling to a displaced dwelling owner will not exceed the difference between the amount paid by the displacing agency for the acquired dwelling and the amount paid by the displaced dwelling owner for a comparable dwelling not in excess of a reasonable amount as determined by the schedule method described in paragraph (b) of this section, or by the comparative

method described in paragraph (c) of this section, or by another method approved pursuant to paragraph (d) of this section, whichever is the least, and in no event will exceed $15,000.

(b) Schedule method. The Secretary may establish a schedule of reasonable acquisition costs of comparable replacement dwellings for the various types of dwellings to be acquired in the community or area involved and meeting the conditions prescribed in § 15.15(d) as well as being open to all persons regardless of race, color, religion, or national origin consistent with the requirements of title VIII, Fair Housing, of Pub. L. 90-284 (42 U.S.C. Chapter 45).

(c) Comparative method. The Secretary may determine the cost of a comparable replacement dwelling on the basis of the asking price, adjusted to reflect market experiences, of a dwelling or dwellings most representative of the dwelling acquired by the displacing agency and meeting the conditions prescribed in § 15.15(d) and paragraph (b) of this section. A single dwelling unit will be used for comparison purposes only when additional comparable dwellings are not available.

(d) Alternative method. The head of the displacing agency may develop criteria for computing the cost of replacement housing when the use of neither of the methods described in paragraph (b) or (c) of this section is feasible. Such an alternative method will be subject to the approval of the Secretary.

(e) For purposes of this section, the cost of a replacement dwelling includes legal, closing, and related costs such as: (1) The cost of a title search, the preparation of conveyance instruments, notarial fees, surveys, the preparation of plats, and charges incident to recordation, (2) lender's, FHA, or VA appraisal fees, (3) FHA application fee, (4) the cost of a certification of structural soundness when required by the lender, FHA, or VA, (5) the cost of a credit report, (6) the cost of a title policy or abstract of title, (7) an escrow agent's fee, and (8) the cost of revenue stamps and of sale or transfer taxes.

(f) For purposes of this section, the cost of a replacement dwelling does

not include a fee, cost, charge, or expense determined to be a part of the finance charge under title I, the Truth in Lending Act, of Pub. L. 90-321, and Regulation "Z" (12 CFR Part 226) issued pursuant thereto by the Board of Governors of the Federal Reserve System.

§ 15.37 Payments for additional interest costs incurred.

(a) In addition to entitlement to the payments provided for by § 15.35, a person displaced from a dwelling actually owned and occupied by him shall be entitled to compensation for any increased interest costs with respect to the amount that is refinanced if the dwelling acquired by the displacing agency was encumbered by a bona fide mortgage for not less than 180 days prior to the initiation of negotiations for the acquisition of that dwelling.

(b) A payment under this section shall be equal to the difference between the discounted present value of the remaining interest payments that were called for by the mortgage on the acquired dwelling and the discounted present value of the interest payments, called for with respect to that amount of principal of the mortgage on the replacement dwelling that is equal to the unpaid principal of the mortgage on the acquired dwelling for the length of its remaining term. Such a payment shall also cover the cost of points paid with respect to the mortgage on the replacement dwelling and the cost of those finance charges that are referred to in § 15.36(f).

(c) For purposes of paragraph (b) of this section, discounted present value shall be calculated on the basis of the prevailing interest rate paid on savings deposits by commercial banks in the general area in which the replacement dwelling is located.

§ 15.38 Mortgage insurance.

Section 203(b) of the Act authorizes the head of any Federal agency administering a Federal mortgage insurance program, upon application by a mortgagee, to insure any mortgage (including advances during construction) executed by a person assisted under that section on a comparable replace

ment dwelling, which mortgage is eligible for such insurance without regard to any eligibility requirements otherwise applicable with respect to age, physical condition, or other personal characteristics of mortgagors, and to make commitments for the insurance of such a mortgage prior to the date of execution of the mortgage.

§ 15.39 Payments to tenants and others for the rental of replacement dwellings. (a) A displaced tenant of a dwelling which he actually and lawfully occupied for a period of not less than 90 days prior to the initiation of negotiations for the acquisition of that dwelling by the Department or by a State agency as a direct result of a program financially assisted by the Department may be eligible for a payment under this section if he rents rather than purchases a decent, safe, and sanitary replacement dwelling.

(b) A displaced owner of a dwelling which he actually owned and occupied for a period of not less than 90 days prior to the initiation of negotiations for the acquisition of that dwelling by the Department or by a State agency as a direct result of a program financially assisted by the Department or which he so owned and occupied for a period of more than 180 days but as to which he has not purchased and occupied a decent, safe, and sanitary replacement dwelling may be eligible for a rental payment under this section.

(c) The amount of the rental payment under this section, which will not exceed $4,000 for a displaced person, will be based on the rental agreed to by the displaced person subject to a limitation determined either by the schedule method described in paragraph (d) of this section or by the comparative method described in paragraph (e) of this section.

(d) The Secretary will establish a rental schedule for renting comparable replacement dwellings (or one or more dwellings most representative of the dwelling acquired) which are available in the private market for the various types of dwellings to be acquired, based upon a current survey and analysis of the market for each type of dwelling required. Payment pursuant to such a schedule will be computed by

determining the amount necessary to rent a comparable replacement dwelling for 4 years (based on the average monthly rental from the schedule) and by subtracting from that amount an amount equal to 48 times the average monthly rental, if reasonable, paid by the displaced person for the acquired dwelling over the 3 months (or more if necessary to determine a representative figure) immediately preceding the initiation of negotiations for the acquisition of that dwelling. If the average rental was unreasonably high or if the displaced person was the owner, the subtraction will be based on a rental charge that is determined would have been reasonable for the acquired dwelling. The amount subtracted will include any rent supplements supplied by others except when such a supplement is to be discontinued upon vacation of the property.

(e) When the method described in paragraph (d) of this section cannot be feasibly applied, the Secretary will apply such criteria as are reasonable and appropriate for computing the rental payment.

(f) A payment of $500 or less for rental will be made in a lump sum. All such payments aggregating in excess of $500 will be paid in semi-annual installments of $500 each except that the final installment shall be for that amount, not in excess of $500, necessary to complete the payments. Prior to making the initial payment, the displacing agency must have determined that the displaced person is occupying a decent, safe, and sanitary dwelling. The manner of making such payments may be modified to accommodate a reasonable request of the displaced person reflecting his wishes in that regard.

§ 15.40 Payments to tenants and others for the purchase of replacement dwellings.

(a) A displaced tenant of a dwelling which he actually and lawfully occupied for a period of not less than 90 days prior to the initiation of negotiations for the acquisition of that dwelling by the Department or by a State agency as a direct result of a program financially assisted by the Department