and this seems to eliminate many of the cases which might otherwise have gone to court.

Senator SIMPSON. Where there are several agencies involved, some may offer more than the property is worth. We have had that in some of the national parks. There is one in Kansas, where they offered $300 an acre for the acreage where the local owner had offered the land for $200, and they were $100 an acre above that offer. And that seems to be typical with many of the acquisitions made by some of the agencies. It seems to me that it is uniformly the practice of all the Federal agencies to do that.

Mr. FREE. Yes, there is that necessity for uniformity, part of which can be covered by the fact that the proposed law clearly defines market value and, also, whatever benefits the owner may get by reason of being displaced; and, therefore, the pressure, let us say, or the sympathies of the appraiser are eliminated, his job becoming one of doing a professional and skillful job of appraising.

Senator SIMPSON. You agree that there should be uniformity in condemnation cases among the Federal agencies?

Mr. FREE. Yes, sir. I think that when the ground rules are spelled out that the appraisers who deliberately distort their values will be very few, and it is a question of having all of their facts and examining them.

Senator SIMPSON. Thank you very much.

Mr. FREE. Thank you.

Senator SIMPSON (presiding). The next witness is Mr. Matt Triggs, assistant legislative director of the Farm Bureau, the American Farm Bureau Federation.

STATEMENT OF MATT TRIGGS, ASSISTANT LEGISLATIVE DIRECTOR, AMERICAN FARM BUREAU FEDERATION

Mr. TRIGGS. Thank you, Mr. Chairman.

We want to express appreciation for the consideration being given to this issue by the Members of the Congress and for this opportunity to present our views.

Both S. 1201 and S. 1681 have major applications to urban acquisition and relocation problems. We do not have policy relating to such matters. We will confine our remarks to the application of the bills to the acquisition of agricultural land.

For many years the American Farm Bureau Federation has held the view that the present acquisition procedures of Federal agencies usually leave the farmer worse off after the taking of his land than he was before such taking.

Substantial costs are always involved in liquidating a going business in one location and starting it up again at another location. The principal costs commonly experienced by a farm operator, either owner or tenant, when the farm he is operating is acquired by condemnation or under threat of condemnation, are as follows:

1. If the farmer does not acquire another farm his machinery and equipment must be sold at forced sale for whatever it may bring. Even where he acquires another farm, the new farm may require different machinery and equipment than the farm from which he is

dispossessed, so that the value of such machinery and equipment is substantially reduced.

2. If a farmer is not able to acquire another farm by the time crops must be planted, he may lose a year's income.

3. If a farmer is not able to acquire another farm expeditiously, he will be forced to dispose of some or all of his livestock, poultry, grain, hay, etc. These items are most valuable as part of a going business so such forced sale may represent a substantial loss.

4. The costs of travel and subsistence in locating a new farm may be substantial.

5. The costs of moving household goods, machinery and equipment, livestock and other personal property to a replacement farm will ordinarily be substantial.

Now, as to S. 1201 and S. 1681: These two bills are similar in many respects, but as noted by the subcommittee chairman in his opening remarks, S. 1201 is considerably broader in its scope than S. 1681.

S. 1201 is the result of a study of real property acquisition authorized by a House resolution approved in 1961 and undertaken by a subcommittee of the House Public Works Committee, aided by a competent staff, and reported in Committee Print No. 31, published December 22, 1964.

A great deal of careful study, investigation, and consideration has gone into this report and the development of the proposed legislation. It appears to us that this effort should be productive of legislative enactment. The report has been available for nearly 7 months. We see no reason why the agencies involved should not be prepared to state their views and any proposed revision at this time. We strongly favor the provisions of sections 101–106 of S. 1201 providing a uniform procedure for all Federal agencies with respect to the acquisition of real property. The most important features of these proposed procedures are the notification to the property owner concerning the "appraised fair value" and that landowners should be offered such fair value. The need for such action is indicated by the report of the House Public Works Committee which estimates (p. 47 of the report) that in 46,006 instances of land acquisition by Federal agencies for which data is available, less than the appraised value was offered the landowner in 25,952 cases and the final price at which the land was acquired was less than the appraised value in 8,624 instances.

The average citizen feels, and in fact is, very inadequate in dealing with a Government agency that is acquiring his property. The elements of time, money, unlimited legal competence, and the authority of immediate taking, lie on the side of Government. True, the owner has access to the courts, but few can afford to take that route. We believe that the owner is entitled to a full and open relationship with representatives of the agency involved and a full disclosure of and opportunity to discuss the elements of value involved.

We find it difficult to understand why some agencies try to acquire property at prices below their approved appraisals, whereas other agencies offer property owners the amount of such appraisals.

We agree with the conclusion of the House Public Works Committee report that:

Every property owner should be entitled to reasonable information concerning the agency's opinion of the value of his property, and he should be entitled to receive an offer for his property at the full amount of the agency's approval appraisal. Any other practice in a situation where, in effect, the owner must sell, is unfair.

We want to express appreciation concerning the position presented to the subcommittee yesterday by the Society of Real Estate Appraisers, also for the position presented this morning by the National Association Real Estate Boards. In general, we are in accord with their views.

We also strongly support the provisions of sections 201-203 of S. 1201, which provide that funds received by a landowner as a result of acquisition by a Federal agency under "condemnation or threat or imminence thereof" should not be subject to capital gains taxation if invested for any purpose, and that severance damages are not to be considered as income for tax purposes. Surely this is no more than equity to those whose property is acquired by condemnation or threat thereof.

Relocation payments: Both bills contain similar provisions relating to relocation payments.

As we understand these provisions as they may be applicable to a farmer whose land is taken by a Federal agency, they would provide the following alternatives: First, under section 3 (a) and section 6 of S. 1681, the farmer could elect to apply for a relocation payment which would be the sum of:

(1) Actual and reasonable expenses in moving his family, his business, farm operation, or other personal property.

(2) His actual and reasonable expenses in searching for a replacement farm. (3) If he disposes of personal property *** and replaces such property at the new location *** the reasonable expenses that would have been required in moving such personal property to the new location.

Second, under section 3(d) of S. 1681, the farmer could elect to receive a fixed relocation payment of $1,000, except that this alternative would not be available if the remainder property is still an economic unit, and, in addition, his actual moving expenses as provided in section 3 (c).

In many cases the relocation payment provided by these provisions would adequately compensate the farmer for supplemental costs associated with the taking of his land. In other cases such payment would not be adequate to place the farmer in the same position monetarily as he was before his property was taken, or to compensate him for the costs summarized in the first part of this statement.

We would therefore regard the proposals in the bill relative to relocation costs as a minimum-that this represents a very substantial improvement over present practice-but does not represent full equity in all cases to farmers whose property is taken by eminent domain or under threat of eminent domain proceedings.

We would therefore support any amendment designed to more adequately compensate for losses sustained as a result of Federal land acquisition by eminent domain. Specifically we recommend provision in section 6 for losses sustained as a result of forced sale of personal property.

Both bills provide that

no provision of this section shall be construed to give any person a cause of action in any court *

**

We would hope that the enactment of legislation on this matter would constitute a recognition by Congress of a right of citizens, rather than a bestowal of a benefit upon them. We submit this distinction is of major importance in principle. Wherever it is proper and right to do so, and we believe in this case it is, legislation should promote the concept that the citizenry, in their dealings with Government agencies, should be placed in the position of maintaining a right to which they are entitled, rather than applying for a privilege that is within the power of the agency to deny or modify.

We, therefore, respectfully recommend the deletion of the provision denying judicial appeal.

In summary: Although we favor the enactment of S. 1681 with revisions as noted, we urge the committee to give consideration to the inclusion in the bill reported of provisions of sections 101 to 106 and 201 to 203 of S. 1201, relative to condemnation procedure and tax treatment of condemnation awards. We are concerned that if this is not done at this time, and in connection with the committee's present consideration of this problem, that the opportunity to obtain overdue redress in the respects noted may not occur in the near future. The importance of early action in these respects is indicated by the fact that the House Public Works Committee report estimates-page 13-that the acreage of land to which fee title will be acquired under Federal or federally assisted programs will exceed a million acres a year during the next few years.

Senator MUSKIE. It has been suggested that the optional payments for the displaced farm operations should be set at a limit of $500, because the Corps of Engineers estimated that the average relocation expense is about $475. What is your reaction to that?

Mr. TRIGGS. You may recall that this section is only applicable where the remainder of the property is an uneconomic unit. It would be our view that in most instances the loss to the farmer involved would be considerably in excess of $1,000 and to reduce it to $500 would represent principally the moving expenses and would not give any compensation for other losses.

Senator MUSKIE. What we are talking about here is the choice that has to be made between actual expenses and optional fixed sums. In developing that alternative, it is necessary to set a fixed sum which comes close to representing the actual cost, so that it will tempt the property owner to take it, to avoid the detail work, expense, and effort of establishing the actual cost, so that whatever figure is finally chosen as the fixed-figure alternative is not going to be the actual cost of relocation.

Mr. TRIGGS. I appreciate that. We favor the basic principle you have stated on several occasions, that the Government should put the landowner of the property that is taken in relatively the same position, monetarily, as he was before the taking. And we do say that the bill, as drafted, goes quite a long ways-in many cases, would go all the way-toward doing this. But, we do think that there are plenty of instances where it will not do this, particularly where

the farmer, necessarily, is involved in a forced sale of personal property, such as machinery, livestock, and all of the other things involved in the farm operation. And if we are going to use the present formula there needs to be something added to cover that.

Senator MUSKIE. My own view, as I have expressed it several times, is that, if the project cannot be justified in making the citizen whole, it cannot be justified at all. There are the abuses that a policy that is too liberal might open up. The abuses are what we are trying to identify and define.

Do you have any question, Senator?

Senator SIMPSON. Yes, Mr. Chairman.

Mr. Triggs, you addressed yourself in your statement here to uniformity of appraisals. Do you think that we should give some study as to the appraisal of the land in question by involving someone other than the Federal appraiser?

Mr. TRIGGS. I think I would have to answer your question by saying that I am not familiar enough with appraisal procedures to answer you.

Senator SIMPSON. I do believe that many property owners feel that they are excluded from any judgment at all in the taking of their property.

Mr. TRIGGS. I do think that much of the difficulty and strong feelings that are involved in appraising and condemnation proceedings would be very much modified if the provisions of sections 101 to 106 of S. 1201 were enacted and implemented. If the landowner has opportunity to talk about the elements of the value that the owner considers should be placed on the property, and has a free and open relationship with the people who are handling the condemnation, I think you will have far fewer court cases and much greater satisfaction with the condemnation procedures of the Federal Government than is the situation now. At present, landowners know they are going to get a series of offers, and even the final offer may be less than the appraised value that the agency has in its hip pocket.

Senator MUSKIE. May I ask for your reaction on this, Mr. Triggs, since you are the last witness? The relocation features of these bills, I think, seem to have pretty broad and pretty generous support. On the other hand, some agencies object to the other features of S. 1201, particularly as they relate to the condemnation and appraisal procedures on the part of the administrative agencies. The feeling is that they are working on these features of their problem and that they need more time to do a solid job. In your judgment, is it important to try to get the passage of these controversial features of S. 1201? If they were delayed and held over, would you favor or oppose separating the two subjects in order to go ahead with the relocation features which, I think, could probably go through pretty easily?

Mr. TRIGGS. If there were any danger that combining them would jeopardize the enactment of the relocation payments, we would favor separating them. I get the general impression, however, that the major opposition to sections 101 to 106 of S. 1201 is from some agencies that do not want to offer a fair appraised value as the initial offer. I think this is an unreasonable position on their part.