A Review of the Virginia Department of Transportation's Business Relocation Process

About the report:

This report details a study that reviewed the Virginia Department of Transportation's (VDOT) business relocation program, with a focus on the relocation difficulties of retail gasoline service stations operating on leased property, as mandated by House Joint Resolution 490 passed by the Virginia General Assembly in 1999. The researchers reviewed reports and legislation related to business relocations and conducted interviews with VDOT field relocation agents, senior FHWA staff, and a representative of the Virginia Gasoline Marketers Council. The study also included a mail survey of businesses relocated by VDOT between 1993 and 1999 and surveys and interviews of relocation agents in other state DOTs. Statistical analyses were performed on relocation payment data for 262 Virginia businesses to estimate what the average payments would have been in the absence of the limits in the federal Uniform Act and how much higher the limits would need to be to ensure that the majority of relocated businesses were compensated appropriately. The recommendations were: (1) FHWA should strongly consider increasing the federal maximums for reestablishment and in lieu of actual moving costs (ILO) payments, given the evidence from Virginia and numerous other states. (2) FHWA should index their reestablishment and ILO payment maximums to the Consumer Price Index to account for inflation. Virginia should also index its relocation payment ceilings to inflation. (3) As long as relocation payment ceilings exist, Virginia should monitor actual payments to businesses and conduct analyses similar to those done in this study every few years. (4) VDOT may wish to consider the potential value of conducting a prospective study of business displacees. Ideally, any future study of the impact of displacement on businesses would follow a sample of businesses from initiation of negotiations to the conclusion of displacement process.

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