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finding that the resale is required to preserve and strengthen the competitive position of small business, or will assist the corporation in the discharge of the duties and responsibilities imposed upon it as successor to Smaller War Plants Corporation.

(2) State or local governments shall be accorded third priority to acquire all classes of surplus real property in order to fulfill, in the public interest, their legitimate needs. Any State or local government which has lost a highway or street over surplus section 23 real property because of Government acquisition or action shall be accorded a special priority, prior to all other State or local governments, to permit it to re-establish such highway or street. This right shall extend to the original right-of-way and any new or additional rights-of-way needed to re-establish the street or highway on a new or more adequate location.

(3) A former owner shall be accorded fourth priority as to any surplus section 23 real property acquired from him by any Government agency after December 31, 1939. This priority shall relate to property which is substantially the identical tract acquired by the Government from the owner. If this tract is not available to the former owner or is not desired by him because it is no longer suitable for the purpose for which it was used when acquired by the Government, he may be offered substitute property. Such substitute property shall be in the same area, be classified as suitable for the use for which the original tract was used when acquired and otherwise be similar to the original tract. With respect to any substitute property thus made available to him the former owner shall be accorded a priority subordinate only to the priorities of Government agencies, State or local governments, a former owner or a tenant of a former owner of the substitute property. Acquisition of a substitute tract shall extinguish the priority of the former owner with respect to the original tract. Where only a portion of an original tract acquired from a former owner is declared surplus and the circumstances indicate that the remainder of such former owner's original tract will be declared surplus within a reasonable time, the disposal agency without affecting the priorities of Government agencies or

State and local governments, may grant the former owner a priority to the portion first declared surplus and extend the same to a date ninety (90) days from the date notice is forwarded to the former owner of the availability of the entire original or substantially identical tract acquired from him.

(4) A tenant of a former owner, who was in possession of agricultural section 23 real property at the time the same was acquired by any Government agency after December 31, 1939, shall be accorded fifth priority with respect to substantially the same property occupied by him as tenant at the time of such acquisition.

(5) A veteran and the spouse and children (in that order) of a person who died while in the active military or naval service of the United States on or after September 16, 1940, shall be accorded a priority as to all surplus section 23 real property classified by the Administrator as suitable for agricultural, residential or small business purposes. This priority shall be subordinate to all the priorities described in subparagraphs (1) through (4) of this paragraph. The disposal agency shall satisfy itself, by reference to the veteran's discharge papers or other evidence, that the applicant is qualified to exercise this priority, and that the property applied for is for the applicant's own personal use for agricultural or residential purposes, or to enable the applicant to establish or maintain his own small business enterprise as defined in this part.

(6) Owner-operators shall be accorded a priority with respect to all surplus section 23 real property classified by the Administrator as suitable for agricultural use. This priority shall be subordinate to the priorities described in subparagraphs (1) through (5) of this paragraph.

(7) Nonprofit institutions shall be accorded a priority to acquire all classes of surplus real property in order to fulfill, in the public interest, their legitimate needs. This priority shall be subordinate to the priorities described in subparagraphs (1) through (6) of this paragraph.

(b) Extent of priorities. The priorities of Government agencies, State or local governments and nonprofit institutions are continuing priorities which

are not exhausted because of their effective exercise with respect to a given piece of property. The priority of a veteran, the spouse and children of a deceased serviceman, or an owner-operator ceases to exist after it has once been effectively exercised with respect to one appropriate unit. The priority of a former owner or tenant is limited to the particular property as described in paragraph (a) (3) and (4) of this section.

(c) Transfer of priorities and transmission on death. No assignment or transfer of a priority shall be recognized, but the priority of a former owner may be exercised through an agent duly authorized in writing where the priority holder is so situated that he cannot exercise it in person. Upon the death of a veteran or former owner his spouse or children (in that order) shall succeed to his priority rights. The priority right of a tenant shall be extinguished by his death.

(d) Time and method of exercise. Government agencies, the Reconstruction Finance Corporation for resale to small business under section 18 (e) of the act, and State or local governments shall have a period of ten (10) days in which to exercise their respective priorities after the date notice of availability is first published, where publication is required under the provisions of § 8305.12 (c) (2). Where a Government agency, including Reconstruction Finance Corporation for resale to small business, has requested a transfer of the property and publication is not required under the provisions of § 8305.12 (c) (2), such Government agency shall exercise its priority within ten (10) days from the date on which a notice of availability was mailed to it, as provided in § 8305.12 (c) (3). Nonprofit institutions shall have a period of ten (10) days after notice of availability is first published in which to exercise their priority with respect to other than section 23 real property. The time for the exercise of all other priorities shall be ninety (90) days after the date notice of availability is first published, or such additional period as the Administrator may allow when necessary or appropriate to facilitate a sale of the property to a former owner entitled to priority: Provided, however, That the property may be disposed of prior to the expiration of such periods pursuant to the provisions of § 8305.12 (e). Within the es

tablished priority period, the priority holder shall indicate an intention to exercise his priority by submitting to the disposal agency a written offer to acquire the property, in duplicate, stating the price that the applicant is willing to pay or, in the case of a Government agency, that a transfer without reimbursement or transfer of funds is authorized by law. Each offer shall be accompanied by such deposit as the disposal agency may require. The offer of a Government agency shall state that the property is being acquired for its own use and not for transfer or disposition, and shall set forth all pertinent facts pertaining to its need for the property. The offer of a State or local government or nonprofit institution shall show in detail the contemplated use of the property. Veterans, the spouse and children of deceased servicemen, and owner-operators may offer to purchase any or all units offered for sale. When an offer cannot be made because the disposal agency lacks necessary information on price, units or other matters, it shall be sufficient if the priority holder, within the applicable priority period, files a written statement of his desire to acquire the property or one or more appropriate units thereof. As soon as the necessary information becomes available (whether during or after the priority period), those who have filed such statements shall be so advised and given an opportunity to make an offer. The offer must be completed within a reasonable time as determined by the disposal agency. If a Government agency or State or local government shall require time to acquire funds, or if a Government agency shall require time to acquire authority to take the property without reimbursement or transfer of funds, the claimant shall so state in its application and indicate the length of time needed for that purpose. Upon receipt of an application with such a statement the disposal agency shall forward a copy of the same to the Administrator. The Administrator will review the application and determine what time (if any) shall be allowed applicant to conclude the acquisition of the property and will advise the disposal agency and the applicant of such determination. During the time thus allowed the property may not be disposed of unless the priority period has expired and applicant's price (where it is seeking to acquire the property on a reimbursable basis) is less than the maximum price

it may be charged and a higher price has been offered by another person.

(e) Failure to offer-full amount or to exercise in time. All priorities not exercised during the priority period shall expire upon the termination of such period. In order to exercise his priority, a priority offeror shall bid the maximum price which he may be charged, which price shall be established in each case by the disposal agency. If his bid is less than his maximum price, such bid shall be treated as a nonpriority offer. The disposal agency may, in its discretion, permit priority holders to make offers after the priority period has ended, and such offers may be considered on the same basis as if they had been submitted during the priority period. Such action by the disposal agency, however, shall not be construed as extending the priority period and such offers may not be accepted to the prejudice of a timely and acceptable offer from another priority offeror. If no offer is received during the priority period from a priority holder at the maximum price which he may be charged, the disposal agency shall certify that the requirements of § 8305.12 (c) (2) and (3) of this part have been complied with and that no priority holder exercised his priority during the priority period. A certified copy of such certification shall be given to any purchaser of the property.

§ 8305.12 Disposal methods and principles-(a) Descriptions, surveys and subdivisions. The disposal agency shall obtain the full and correct legal description of the property to be disposed of and take the steps necessary to determine its exact location and area. Surveys shall be made, when necessary, and markers or monuments placed upon the ground. For disposal to others than Government agencies, State or local governments, former owners or tenants, surplus section 23 real property shall be subdivided by the disposal agency into appropriate units for disposal. Section 23 real property classified as suitable for agricultural use shall be subdivided by the disposal agency into economic family-size units wherever practicable. The size of such units may vary according to the conditions and farming practices in the locality where the land is situated. Section 23 real property not classified as suitable for agricultural use shall be subdivided into such units as seem suitable

in view of the character of the property, the use or uses to which it may be put and the possibilities of giving veterans and those who will use the property personally a fair opportunity to acquire and advantageously utilize the property. Plans for such subdividing shall be developed immediately after the disposal agency receives the declaration of surplus. The actual work of subdividing shall be carried forward as rapidly as practicable in view of all the circumstances, with effort made to complete the task at the earliest possible date after the expiration of the priority period. Subdivision may be delayed if it appears that the property will be absorbed by the priorities of Government agencies, State or local governments, former owners or tenants.

(b) Evaluation and appraisal. When property is to be transferred to a Government agency without reimbursement, it will not be necessary to establish the fair value or current market value of the property. When such transfer is to be made with reimbursement, an estimate shall be made of its fair value. In all other cases, an estimate shall be made of its current market value. The term "fair value" means the maximum price which a well-informed buyer, acting intelligently and voluntarily, would be warranted in paying if he were acquiring the property for long-term investment or for continued use with the intention of devoting it to the best or most productive type of use for which the property is suitable or capable of being adapted. The term "current market value" means the highest price the property will bring in terms of money if offered for sale in the open market with reasonable time to find a purchaser buying with knowledge of the uses and purposes to which it is adapted and for which it is capable of being used. To determine such values, the disposal agency shall have the property appraised by experienced and qualified appraisers familiar with the types of property to be appraised by them. They may be staff appraisers of the disposal agency, individuals employed on a loan reimbursable basis from other Federal agencies or independent appraisers in private business. All appraisal reports shall contain the appraiser's certificate that he has no interest, direct or indirect, in the property or sale or disposition thereof.

(c) Notice and advertisement—(1) Wide publicity. The disposal agency shall avail itself of all suitable means to give wide publicity to the availability for disposal of surplus real property.

(2) Publication of notice. where a transfer is requested by a Government agency, including the Reconstruction Finance Corporation for resale to small business, the disposal agency, upon receipt of a declaration of surplus real property, shall promptly and widely publicize the property, giving information adequate to inform interested persons of the general nature of the property and its possible uses. Such publicity shall be by public advertising, and also may include press releases, display advertisements, and any other appropriate means which it is customary to use for advertising notices of sale. Public advertising shall consist of a sale notice containing substantially the matters set forth in Exhibit A of this part. With respect to other than section 23 real property, including structures to be disposed of separate from land, such notice shall be published one or more times during the ten (10) days following the date of the first publication. With respect to section 23 real property, exclusive of structures to be disposed of separate from land, such notice shall be published at least three (3) times during the ninety (90) days following the date such notice is first published, at approximate intervals of twenty-one (21) days, unless a Government agency or State or local government exercises its priority to acquire the property within the prescribed ten-day period of priority for such claimants.

State and the political subdivisions in which the property is located, and to the former owner when he is entitled to priority. The notice to the former owner shall be sent by registered mail to his last known address Except with return receipt requested.

(3) Notice by mail. Where a transfer is requested by one of the armed forces for national defense purposes prior to the conclusion of peace, its need being recognized as paramount, no notice to other Government agencies is required. In all other cases where a transfer is requested by a Government agency, including the Reconstruction Finance Corporation for resale to small business, the disposal agency shall send a notice of availability by mail to all Government agencies listed in Exhibit B of this part. At the time of the first publication of the notice required by subparagraph (2) of this paragraph, the disposal agency shall send a copy of such notice by mail to all Government agencies listed in Exhibit B hereof to the

(4) Additional notice. If the disposal agency wishes to permit priority holders who have not exercised their priorities during the priority period to submit offers after such period has expired, such additional notice may be given to priority holders as the disposal agency shall deem proper.

(d) Information available to purchasers. Every effort shall be made to have available in the office of the officer having charge of the disposal, as soon as possible after notice of availability is first published, all necessary information concerning the property. This shall include the appraised value of the property, the unit sizes in which the property will be sold to various classes of purchasers, the priorities and the time and method of exercising them, the maximum prices which may be charged different priority buyers (see paragraph (h) of this section) and all other terms and conditions of sale. Any person shall be entitled, upon request, to receive such information or have access thereto at all reasonable times, as well as information concerning offers, exercises of priorities and sales that have been made at the time of the inquiry.

(e) Offers and procedure thereon. During the prescribed priority periods, the disposal agency shall receive offers from priority and nonpriority buyers. No offers shall be accepted, however, until the expiration of the priority period, except in the following cases:

(1) Where an immediate transfer is requested by one of the armed forces for national defense purposes prior to the conclusion of peace,

(2) Where a Government agency or State or local government exercises its priority to acquire surplus section 23 real property within the prescribed tenday period, or

(3) Where a former owner exercises his priority to acquire surplus section 23 real property and no offer has been submitted by a Government agency or State or local government, at its maximum price within the prescribed ten-day period of priority for such claimants.

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(5) Fissionable materials. (i) (a) In all disposals of lands hereafter made under the authority and provisions of the Surplus Property Act of 1944; (b) In all leases, permits, or other authorizations of whatever kind, hereafter granted to remove minerals from such lands; and (c) In all leases, permits or other authorizations which otherwise would preclude the United States from exercising its right to enter upon such lands and prospect for, mine, and remove minerals, there shall be reserved to the United States all fissionable materials in the lands, together with the right, at any and all times, to enter upon the lands

and prospect for, mine, and remove such materials; Provided, That no such reservation shall interfere with the primary use of the land established or indicated by any act of Congress; And provided further, That no such reservation shall be required whenever the Secretary of the Interior shall determine that the land affected does not contain substantial deposits of fissionable materials, or that, in view of all the circumstances, there is no reasonable probability that such materials are present in quantities sufficient to justify their extraction.

(ii) The term "fissionable materials" as used herein means (a) all deposits from which the substances known as thorium, uranium (including uranium enriched as to one of its isotopes), and elements higher than uranium in the periodic table, can be refined or produced, and (b) all deposits from which there can be refined or produced other substances determined by the President by Executive order to be readily capable of or peculiarly related to transmutation of atomic species, the production of nuclear fission, or the release of atomic energy. (Executive Order 9701, March 4, 1946, Title 3, Chapter II, supra)

(iii) Unless the lands are within the exceptions above provided, all notices of sale or availability given or published by the disposal agencies shall disclose that the lands involved will be disposed of or sold subject to the reservation of the mineral rights referred to in the foregoing subdivisions of this subparagraph.

(6) Water rights. (i) Water rights in connection with real property subject to irrigation shall ordinarily be disposed of with the real property to which they relate, whether such rights are evidenced by stock certificates in irrigation projects or otherwise, and shall be disposed of subject to the provisions of this part.

(ii) In order to meet the objectives of the act to discourage disposals for speculative purposes, it shall be the policy of the Administrator to dispose of such rights to the owners of the real property who may be entitled to the benefits thereof, rather than to persons who are not owners, and in quantities proportionate to the amount of property owned by such persons.

(iii) Former owners shall be entitled to a priority for any such rights acquired from them in connection with real prop

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