Lakewood Reinvestment Authority Resolution 2003-4 REQUEST FOR LRA ACTION

RESOLUTION: LRA 2003-4

SUBJECT: A resolution revising the Relocation Policy for the Colfax/Wadsworth Reinvestment Area.

ADDRESS: Colfax-Wadsworth Reinvestment Area

RECOMMENDATION: Approval

SUMMARY AND BACKGROUND OF SUBJECT MATTER: The Revised Relocation Policy addresses two issues. The first change can be seen in the revised paragraph 6.J, which establishes that a ceased business is not eligible for more compensation than is already provided for in the Relocation Policy. The second change is the inclusion of a new paragraph 10.B which establishes that a mediator or hearing officer is "bound and limited" by the terms of the Relocation Policy. Both issues ensure that the terms established by the Relocation Policy are adhered.

RESOLUTION ADOPTION DATE: April 28, 2003

ORIGINATED BY: Rebecca P. Clark, LRA Director

STAFF PERSON RESPONSIBLE: Rebecca P. Clark, LRA Director, 303-987-7525

DOCUMENTS ATTACHED: Resolution LRA 2003-4
Revised Relocation Policy for the
Colfax/Wadsworth Reinvestment Area

SUBMITTED BY:
Rebecca P. Clark, LRA Director
Jacque Wedding-Scott, LRA Treasurer

REVIEWED BY:
Michael J. Rock, Secretary/Executive Director
Margaret A. Greer, LRA Clerk


LRA 2003-4

A RESOLUTION

REVISING THE RELOCATION POLICY FOR THE COLFAX/WADSWORTH REINVESTMENT AREA.

WHEREAS, the City Council of the City of Lakewood approved the Colfax-Wadsworth Reinvestment Plan on August 9, 1999; and

WHEREAS, the Lakewood Reinvestment Authority approved a Relocation Policy for the Colfax-Wadsworth Project on October 11, 1999; and

WHEREAS, certain businesses and residents will be required to relocate in order for the redevelopment to take place; and

WHEREAS, businesses and residents which are relocated should be entitled to assistance to allow them to relocate and to be reestablished in new locations; and

WHEREAS, the experience in administering relocation benefits in connection with the Belmar Project has indicated the need for certain corrections in the relocation programs implemented by the LRA; and

WHEREAS, it is advantageous to clarify policies before relocations begin in connection with the Colfax/Wadsworth Project.

NOW, THEREFORE, BE IT RESOLVED by the Lakewood Reinvestment Authority of the City of Lakewood, Colorado, that:

SECTION 1: The Lakewood Reinvestment Authority hereby adopts the Revised Relocation Policy for the Colfax/Wadsworth Project, attached hereto as Exhibit 1, to govern the eligibility and administration of relocation benefits for the Colfax-Wadsworth Project.

INTRODUCED, READ AND ADOPTED by a vote of 9 for and 0 against at a regular meeting of the Board of Commissioners of the Lakewood Reinvestment Authority on April 28, 2003, at 7:30 o'clock p.m. at Lakewood Civic Center, 480 South Allison Parkway, Lakewood, Colorado.

Stephen A. Burkholder, Chair

ATTEST:
Michael J. Rock
Secretary/Executive Director


LAKEWOOD REVITALIZATION AUTHORITY
RELOCATION POLICY
FOR THE
COLFAX/WADSWORTH PROJECT

1. PURPOSE.
The Lakewood Revitalization Authority (the "Authority") adopts this Policy which describes the requirements governing the provision of relocation payments and other relocation assistance to residents and businesses displaced as a result of acquisition of property pursuant to the Colfax/Wadsworth Revitalization Plan (the "Plan"), approved by the Lakewood City Council on August 9, 1999, as it may be amended from time to time.

2. SCOPE.

A. Colfax/Wadsworth Reinvestment Plan. This Policy is derived from and is an extension of the relocation provisions of the Plan. The specific provisions of this Policy shall govern and control over the general provisions of the Plan in the event of conflicts between the documents.

B. Nature of Payments. The Authority recognizes that relocation payments are administrative in nature and are not required by law. Therefore, it is the intention of the Authority that the determinations of the Authority regarding eligibility for and the amount of relocation payments made pursuant to this Policy shall be a matter of discretion of the Authority. No federal or state funds are being utilized by the Authority in connection with the Colfax/Wadsworth Project.

C. No Contract. Nothing in this Policy shall be construed as an entitlement or a contractual or promissory obligation to make relocation payments. All payments made pursuant to this Policy are at the discretion of the Authority.

3. DEFINITIONS.
The following definitions shall be used by the Authority in interpreting the payments and benefits available under this Policy:
Action by the Authority. Any lawful activity undertaken by the Authority, its agents or assigns, or one operating pursuant to a contract with the Authority.

Business. Any lawful activity that is conducted primarily for the purchase, sale, lease or rental of personal or real property; or for the manufacture, processing or marketing of products, commodities, or any other personal property; or is conducted primarily for the sale of services to the public. This definition shall not include: (1) outdoor advertising displays which are intended to be acquired as part of the real property purchased by the Authority; and (2) public utilities such as cable, electrical, gas and telephone lines and related service facilities.

Development Agreement. The agreement between the Authority and a developer selected to redevelop the Project Area.

Displaced Business. Any business that moves its personal property from real property which is acquired as a result of Action by the Authority for projects within the Project Area, if such business is occupying such real property on the date of the approval of the Development Agreement and has occupied such real property for 180 days prior to the date of the approval of the Development Agreement.

Displaced Resident. Any resident who moves his/her personal property from a dwelling which is acquired as a result of the Action by the Authority for projects within the Project Area, if such resident is occupying such dwelling on the date of the approval of the Development Agreement and has occupied such dwelling for 90 days prior to the date of the approval of the Development Agreement.

Dwelling. The place of permanent or customary and usual residence of a person including a single-family house or a single-family unit in a multifamily structure.

Good Will. The advantage gained by a business arising from an established course of commercial activity.

Lost Profits. The profits which a business fails to realize as a result of relocation arising from inability to conduct business during the relocation of the business.

Notice of Intent to Acquire. The notice by the Authority to the Owner or that the real property will be acquired by the Authority.

Notice to Relocate. The written notice from the Authority to an Owner, Business, or Resident that it must move from its current location in the Project Area. Relocation shall not be required upon less than thirty days notice. A Notice to Relocate and negotiations concerning relocation may occur at any time.

Owner. Any person who owns fee simple title or a life estate in real property to be acquired for the Project or who holds any other interest which in the judgment of the Authority warrants consideration as ownership.
Personal Property. Tangible property, which is classified by the Authority as personalty under Colorado law, is located on real property in the Project Area, and is not purchased by the Authority in the acquisition of such real property.

Plan. The Colfax/Wadsworth Reinvestment Plan, which was approved and adopted by the City Council of the City of Lakewood on August 9, 1999, as the same may be amended by such City Council from time to time.

Project. Any urban renewal or redevelopment project in the Project Area as described in the Urban Renewal Plan.

Project Area. The area designated for revitalization activities in the Plan.

Real Property. Property, which is classified by the Authority as realty under Colorado law, for example, fixtures that cannot be moved at a reasonable cost. Relocation expenses shall not be reimbursed for fixtures and other items of real property which have been purchased by the Authority in connection with its acquisition of the realty from which a Displaced Business or Resident is moving.

Resident. A person occupying a dwelling as his/her principal place of residence.

4. RELOCATION ASSISTANCE ADVISORY SERVICES.

A. General. The Authority will provide a relocation assistance advisory program that offers the services described below. The purpose of the advisory services program is to minimize inconvenience to persons who must be relocated and to provide an information program to advise these persons of relocation activities and benefits on a continuing basis.

B. Services to be Provided. The Authority, through its staff, will provide the following services:
1. Assistance with identifying real estate brokers and others who may help locate replacement housing or business locations.
2. Assistance in identifying services for moving, packing, storage and insurance.
3. Assistance with the Authority's relocation benefits procedures and submittals for relocation benefits.

C. Notification. As soon as feasible after the approval of the Development Agreement, the Authority shall advise each Business and Resident in the Project Areas regarding:
1. The relocation services, benefits and procedures to be provided by the Authority.
2. The anticipated schedule for the Project including the expected date for the completion of all Business and Residential moves.

5. GENERAL RELOCATION ASSISTANCE POLICIES.

A. No Duplication of Payments. No Displaced Business shall receive any compensation for relocation which, in the opinion of the Authority, would substantially duplicate the compensation which was received or which a Displaced Business or Resident would be eligible to receive under the state law of eminent domain or under any other law or regulation. Under no circumstances, will there be a duplication of payments for acquisition and for relocation.

B. Least Cost Approach. The amount of payment for an eligible relocation expense shall not exceed the least costly method, as determined by the Authority, of accomplishing the objective of the payment without causing undue hardship to the Displaced Business or Resident.

C. Determination of Eligibility. The Authority will designate a person as Relocation Coordinator who shall have primary responsibility for establishing eligibility for and the amount of relocation payments claimed in accordance with this Policy. Appeals from the decisions made by the Relocation Coordinator shall be determined in accordance with Section 10 hereof.

D. Documentation. If requested, any claim for relocation payment shall be submitted to the Authority on the appropriate form and supported by such documentation as may reasonably be required by the Authority to establish accurately expenses incurred, such as bills, statements, certified prices, appraisals, or other evidence of such expenses.

E. Set Off for Claims. The Authority may withhold any part or all of a relocation payment to a Displaced Business or Resident to satisfy an obligation of the Displaced Business or Resident to the Authority or the City of Lakewood.

F. Burden of Proof. Claimants shall have the burden of proof to establish eligibility for and amount of any relocation payment claimed hereunder.

G. Time for Moving. All claimants must complete any relocation from their current sites by the date specified in the settlement agreement with the Authority or if no settlement is achieved, within thirty days of receiving written notification from the Authority to relocate or within such additional time as the Authority may determine and specify in writing.

H. Owner's Obligation to Notify New Tenants. No Owner within the Urban Renewal Area shall lease premises to a tenant after the owner's receipt of notice of the approval of the Development Agreement, without giving prior written notice to such tenant that the property is being acquired by the Authority and that such tenant shall not be eligible for relocation benefits from the authority. A copy of the Owner's notice to the tenant shall be delivered to the Authority.

I. Time Limit for Submission of Claims.
All claims and documentation must be submitted to the Relocation Coordinator within six (6) months of the date on which the Displaced Business or Resident completes his/her move.

J. Ineligible Businesses and Residents.
The following Businesses or Resident shall not be eligible for relocation assistance:
(a) Any Business or Resident, which does not occupy any real property in the Project Area on the date of the approval of the Development Agreement.
(b) Any Business which has not occupied real property in the Project Area for 180 days prior to the date of approval of the Development Agreement.
(c) Any Resident who has not occupied real property in the Project Area for 90 days prior to the date of approval of the Development Agreement.
(d) Any Business or Resident which moves before receiving a Notice to Relocate from the Authority, if such property is for any reason not redeveloped pursuant to the Plan.
(e) A subtenant of a tenant, unless such subtenant demonstrates, with documentation satisfactory to the Authority, that it is a separate legal entity from the tenant and otherwise satisfies the eligibility requirements of this policy.
(f) Any Business or Resident, which the Authority determines, had prior plans to relocate for reasons independent of the project for which the Authority is acquiring the property.
(g) Any Business whose expenses relate to relocating outdoor advertising displays.
(h) Multiple lease agreements for different leasehold areas shall not be considered multiple tenancies if the Authority determines, in its sole discretion, that the areas are operated as a single Business.
(i) Any Displaced Business, which is operating in violation of applicable law, including businesses operating without required licenses or in violation of applicable land use laws and regulations.
(j) Any Business to whom the Authority made a good faith offer to retain as a tenant or owner in a Project and which Business decline such offer.
(k) Public utilities are not eligible for relocation payments hereunder.

6. ELIGIBLE EXPENSES -- BUSINESS RELOCATIONS.

A. Professional Services, Insurance and Transportation. A Displaced Business shall receive a sum of $1,500.00, plus $.50 per square foot for the area of the premises in excess of $3,000 square feet, not to exceed a total payment of $5,000.00, to cover any expenses incurred in the following categories:
1. Professional services, including, but not limited to, architects, brokers, planners, attorneys, engineers, and consultants hired for such activities as finding a new location, negotiating a new lease or purchase of the new location, and planning the move of the personal property. Professional fees incurred in connection with representing the Displaced Business in preparing a relocation claim or in contacts or proceedings before the Authority, including grievance procedures or other administrative or legal proceedings or suit, shall not be eligible for reimbursement.
2. Liability or casualty insurance in connection with the move and any temporary storage.
3. Transportation expenses in connection with relocation.

B. Moving. Packing, crating, moving, unpacking, and uncrating personal property, based on moving industry customary and standard rates as established by the Authority.

C. Temporary Storage. Storage of personal property as the Authority determines to be necessary, based on customary and standard rates as established by the Authority. The period of storage shall not exceed six (6) months. The storage space shall not exceed 50% of the area from which the Displaced Business is relocating.

D. Reinstallations. Disconnecting, dismantling, removing, reassembling, and installing relocated and any substitute machinery, equipment and other personal property, based on customary and standard costs as established by the Authority. This includes connection to utilities available at the new site and modifications necessary to adapt such property to the replacement structure or to the utilities or to adapt the utilities to the personal property. A Displaced Business shall be eligible for payment of these expenses only if it provides a list of property that is to be disconnected and reinstalled at the replacement location to the Authority by the date set for submission of the list by the Authority.

E. Licenses, Printing and Advertising. The sum of $1,000.00 for Businesses occupying up to 4,000 square feet, $2,000.00 for Businesses occupying from 4,001 to 12,000 square feet, and $4,000.00 for Businesses occupying space in excess of 12,000 square feet to cover any expenses incurred in the following categories:
1. Any license, permit or certification required by the Displaced Business at the replacement location.
2. Advertising, relettering signs and printing materials such as stationery and business cards made obsolete as a result of the move.

F. Substitute Personal Property. Purchase of substitute personal property, which is used as part of the Business and is not moved but is promptly replaced with a comparable substitute item at the replacement site. The Business is entitled to payment of the lesser of:
1. The cost of the substitute item, including installation cost at the replacement site, minus any proceeds from the sale or trade in of the replaced item, if any; or
2. The estimated cost of moving the replaced item, based on the lowest acceptable bid or estimate by the Authority for eligible moving and related expenses, but with no allowance for storage.
3. Personal property which must be upgraded to comply with health or building codes or other applicable regulations or which has no or minimal value, as determined by the Authority, shall not be covered by this Section.

G. Goodwill and Lost Profits. Displaced Businesses may request a sum for lost profits and impaired goodwill. An expense for lost profits shall be based upon the average monthly profit of the Business as reflected on audited financial statements for the previous twelve months submitted to the Authority. Reimbursement for lost profits shall be limited to 75% of the average monthly profit as reflected on the audited financial statements for a maximum of three months. The Authority may make a payment in the discretion of the Relocation Coordinator for impaired goodwill based upon a request by a Business documented with verified evidence of the nature of and reasons for impairment of goodwill. Under no circumstances will payments for impaired goodwill exceed $5,000.

H. Real Property Fixtures. Fixtures shall be included as part of the real estate and shall be included in the purchase proceeds or the condemnation award. A Displaced Business shall not be compensated for loss of real property fixtures installed on the premises to be vacated unless the Business provides evidence satisfactory to the Authority that the Business installed the fixtures and that the Business, not the owner of the premises, owns the fixtures. If such evidence is provided, the value of the fixtures will be established by the Authority's appraiser, subject to reduction for depreciation calculated by the appraiser. The value reimbursed to the Business shall be only for the Business's remaining lease term in the premises.

I. Notification to the Authority and Inspection. To be eligible for payment under this section, the Displaced Business shall:
1. Permit the Authority to make reasonable and timely inspections of the personal property at the displacement and replacement sites.
2. Provide an inventory of all personal property expected to be moved within thirty days after receiving a Notice to Relocate from the Authority.

J. Cessation of Business, Unspecified Relocation Site and Moving Out of the Area. If a Displaced Business decides to cease doing business or delays a decision on a relocation site, the Authority will assume that the business is moving 25 miles and pay moving costs pursuant to this Policy based on such assumption. If a Displaced Business chooses to relocate to a site that requires a move in excess of 25 miles, the Authority will pay moving costs only pursuant to this Policy based on the assumption that the Business is moving 25 miles away. A Displaced Business, which decides to cease business, shall not be eligible for compensation for lost profits, goodwill, substitute personal property, or reinstallation as otherwise provided for in this Relocation Policy.

K. Limit on Business Relocation Expenses. Eligible expenses for relocations of Displaced Businesses shall be limited to a total of $50,000.

7. ELIGIBLE EXPENSES - RESIDENTIAL MOVES.

A. Transportation. The cost of moving the Displaced Resident and his/her personal property for a distance up to 25 miles based on moving industry customary and standard rates, as established by the Authority.

B. Moving. Packing, crating, moving, unpacking, and uncrating personal property, based on moving industry customary and standard rates as established by the Authority.

C. Temporary Storage. Storage of personal property as the Authority determines to be necessary, based on customary and standard rates as established by the Authority. The period of storage shall not exceed six (6) months. The storage space shall not exceed 50% of the Dwelling from which the Displaced Resident is relocating.

D. Reinstallations. The cost of disconnecting, dismantling, removing, reassembling, and reinstalling household appliances and utility service.

E. Insurance. The cost of insurance for the replacement value of personal property in connection with the move or necessary storage.

F. Notification of the Authority and Inspection. To be eligible for payment under this section, the Displaced Resident shall:
1. Permit the Authority to make reasonable and timely inspections of the personal property at the displacement and replacement sites.
2. Provide an inventory of all personal property expected to be moved within thirty days after receiving a Notice to Relocate from the Authority.

G. Limit on Residential Relocation Expenses. Eligible expenses for relocation of Displaced Residents shall be limited to a total of $15,000.

8. RELOCATION SETTLEMENTS.

A. Total Settlement. It is the intent of the Authority to arrive at negotiated total lump-sum settlements with all Displaced Business and Residents. Those settlements will compensate all of the eligible expenses contained herein. Claimants will receive one-half of the payment amount following approval of the Business's or Resident's settlement agreement with the Authority. The remaining one-half will be paid no later than thirty days following proof the claimant has vacated the property. If a settlement is not reached by negotiation, payments shall be made as outlined in section 10, Appeals, below.

B. Rent Subsidies. In consideration of the potential difference between the rent paid by a Displaced Business at the time it is required to relocate and the higher rent charged for comparable space elsewhere, the Authority may, at its discretion, decide to pay a rent subsidy based on the differential between the rent paid prior to relocation and the higher rent paid for comparable space at the new location for a maximum of four months.

C. Security Deposits. If a tenant has paid a security deposit to a landlord or property manager for a lease on property to which the Authority is taking title or possession, the Authority shall request the holder of the security deposit to refund the deposit to the tenant or to turn over the deposit to Authority for refund to the tenant.

D. Loans. Upon request, the Authority will review any loan programs offered by lending institutions for the purpose of assisting Displaced Businesses and will consider supporting such program, for example, by buying down an interest rate.

E. Rent Payment and Abatement. For properties acquired by the Authority, upon settlement, the Authority may assume all payments due under the lease from the date the tenant vacates the premises until the Authority takes possession of or title to the property and such payments are no longer due to the landowner or its agent. If the Authority has possession of or title to the property, a tenant may elect to have its rent abated from the date of execution of a settlement agreement with the Authority until the tenant's agreed-upon date of vacating the premises. If the tenant fails to move out by the agreed-upon date, the tenant shall resume paying rent to the Authority. If rent is abated while the tenant continues to occupy the property, an amount equal to the abated rent shall be deducted from any rent subsidy to be paid to the tenant by the Authority. Any unpaid rent owed by the tenant to the Authority shall be deducted by the Authority from the final settlement payment to the tenant.

9. INELIGIBLE MOVING AND RELATED EXPENSES.
A Displaced Business or Displaced Resident is not entitled to payment for:

A. Cost of moving any structure or other real property improvement in which a Displaced Business or Resident reserves ownership.

B. Interest on a loan to cover moving or storage expenses.

C. Loss of trained employees.

D. Configuration or physical changes at the replacement location of business or residence.

E. Any additional expense of a Business, which was incurred because of operating in a new location.

F. Personal injury.

G. Any legal fee or other cost for preparing a claim for a relocation payment or for representing claimant before the Authority or any other body or court.

H. Taxes.

I. Any expense or payment for which the business receives reimbursement or compensation from another source or pursuant to any other law, rule or regulation.

J. Any expenses not specifically listed as eligible for payment in this Policy.

10. APPEALS.

A. Dispute Resolution. It is the intent of the Authority to provide an efficient, fair process for settlement of eligible relocation expenses. The Authority prefers a negotiated settlement that is mutually fair and beneficial to both the Authority and Displaced Business or Resident. In order to achieve this result, the Authority prefers that impasses in negotiation be resolved through mediation and will arrange for a mediation process at anytime at the request of a Displaced Business or Resident. Mediation shall be a prerequisite to filing an appeal under this Section.

B. Appeals Limited to the Express Terms of This Policy. In the mediation of or appeal of any determination of any appeal, the mediator or the hearing officer shall be bound by and limited to the terms of this Relocation Policy. No recommended mediation or determination of benefits may exceed the dollar limits established by this Relocation Policy.

C. Selection of Mediator. If the Authority determines that a settlement of eligible relocation expenses with a Displaced Business or Resident cannot be reached due to an impasse in negotiations, the Authority shall schedule a session with a mediator within thirty days of a written notice to the Business or Resident that an impasse exists, or within such time period as the Authority and Business or Resident may mutually agree. The mediator shall be selected by mutual consent of the Authority and the Business or Resident. If the Business or Resident refuses to participate in the selection of a mediator or unreasonably withholds consent in the selection of a mediator, the Authority shall make a final determination of benefits, which shall be payable upon the Business' or Resident's completion of a move from the project area. The Business or Resident shall have no right of appeal or judicial review of such determination.

D. Unsuccessful Mediation. If the mediation fails to result in a settlement agreement between the Authority and the Displaced Business or Resident, the Authority shall make a final determination of benefits, and shall pay one-half of such determination immediately. The final payment shall be made at the conclusion of the appeal period or upon conclusion of the appeal if one is filed.

E. Scope and Timing of Appeal. If mediation is unsuccessful, the Authority shall request the mediator to provide a dated notice that the dispute could not be resolved to both the Authority and the Displaced Business or Resident. The Business or Resident shall have fourteen days from the date of that notice to file an appeal with the Authority. The appeal shall be limited to a determination regarding eligibility for or the amount of payments set forth in this Policy and pursuant to any further resolutions or actions of the Authority establishing rates for eligible expenses.

F. Initiation of Appeal. An appeal is instituted by a written request for review by the claimant, which may include any documentation deemed relevant by the claimant. If a hearing is requested in the request for review, it shall be scheduled within thirty days before a hearing officer designated by the Authority. If no hearing is desired, the officer shall decide the appeal based on the documentation provided with the request for review. In either case, the officer's decisions shall be subject to review and revision by the Authority. All supporting documentation shall be filed with the Authority at least seven days prior to the hearing. Information submitted thereafter need not be considered by the Authority.

G. Right to Representation. A claimant may be represented by legal counsel in connection with the appeal, but solely at its own expense.

H. Review of Files by Claimant. The Authority will permit a claimant to inspect and copy all files and records pertinent to such appeal pursuant to the Open Records Act, including the limitations continued therein, and at the expense of the claimant.

I. Scope of Review. In deciding the appeal, the hearing officer shall consider:
1. All applicable rules and regulations;
2. All pertinent justification and written materials submitted by the claimant;
3. All material upon which the Authority staff based the determination being appealed and any other available information that is needed to assure a fair and full review of the appeal.

J. Determination and Notification After Written Appeal. The hearing officer shall make a written determination within thirty days of the hearing, or if no hearing is requested, within thirty days of the receipt of the request for review, and shall furnish the claimant with a copy. The written determination will include, but need not be limited to:
1. The factual and legal basis upon which the decision was based, including any pertinent explanation;
2. If any payment or other relief to the claimant is granted, a statement of how this will be provided.

K. Determinations Final. Determinations on appeals made by the hearing officer and the Authority shall be final and not subject to further review or appeal.

11. GENERAL PROVISIONS.

A. Time. Any deadline or time period in this policy may be modified in a written agreement signed by the Authority and a Displaced Business or Resident.

B. Payments. In its sole discretion, the Authority may agree to a payment schedule in variance from this policy upon a showing of necessity by the Displaced Business or Resident.