Oftentimes, HUD funded projects require the acquisition of real property. Agencies may acquire the needed real property from owners by voluntary or involuntary means. Under the URA, an acquisition is considered to be involuntary when an agency acquires property under threat or use of eminent domain. Eminent domain is the power of the government to take private property for public purposes with payment of just compensation.

The Fifth Amendment of the U.S. Constitution states that "private property shall not be taken without payment of just compensation" and that "no person shall be deprived of life, liberty, or property without due process of the law." These constitutional rights form the basis of the URA's protections for property owners.

The URA requirements for voluntary acquisitions and involuntary acquisitions differ significantly. While there are protections for property owners in both circumstances, only involuntary acquisitions trigger the full acquisition requirements of the URA found in 49 CFR Part 24 Subpart B.

Grantees must understand the critical differences between voluntary acquisitions and involuntary acquisitions under the URA before acquiring property for a HUD funded project.

What makes a transaction "voluntary"?

• For agencies with eminent domain authority, if:
  
  
  • No specific site is needed and any of several properties could be acquired for project purposes; and
  • The property is not part of an intended, planned or designated project area where other properties will be acquired within specific time limits; and
  • The agency informs the owner in writing of the property's market value; and
  • The agency also informs the owner in writing that the property will not be acquired, through condemnation, if negotiations do not reach an amicable agreement.
  • If tenants are displaced, the tenants are provided relocation assistance.
    
    
• For agencies without eminent domain authority, if:
  
  
  • The agency notifies the owner in writing of the property's market value; and
  • The agency notifies the owner prior to making an offer, that it will not acquire property if an amicable settlement cannot be reached.
  • If tenants are displaced, the tenants are provided relocation assistance.

Where can you go to find more information about voluntary and involuntary acquisition?

You should consult 49 CFR 24.101(b)(1)-(5) and Chapter 5 of HUD Handbook 1378 for more guidance.