S Grant - NC Department of Transportation FY09-5311 CT Grant Program

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(b) Calculating the Fair Market Value of Prematurely Withdrawn Project Property. The Contractor agrees that the State Government retains a State interest in the fair market value of Project property prematurely withdrawn from appropriate use. The amount of the State interest in the Project property shall be determined by the ratio of the State assistance awarded for the property to the. actual cost of the property. The Contractor agrees that the fair market value of Project property prematurely withdrawn from use will be calculated as follows: 1. Equipment and Supplies. The Contractor agrees that the fair market value of Project equipment and supplies shall be calculated by straight-line depreciation of that property, based on the useful life of the equipment or supplies as established by the Department. The fair market value of Project equipment and supplies shall be the value immediately before the occurrence prompting the withdrawal of the equipment or supplies from appropriate use. In the case of Project equipment or supplies lost or damaged by fire, casualty, or natural disaster, the fair market value shall be calculated on the basis of the condition of that equipment or supplies immediately before the fire, casualty, or natural disaster, or the amount of insurance coverage, whichever is greater. 2. Real Property. The Contractor agrees that the fair market value of real property shall be determined either on the basis of competent appraisal based on an appropriate date approved by the Department, as provided by 49 C.F.R. Part 24, by straight line depreciation of improvements to real property coupled with the value of the land on the basis of appraisal, or other Federal or State law or regulation that may be applicable. 3. Exceptional Circumstances. The Contractor agrees that the Department may require the use of another method to determine the fair market value of Project property. In unusual circumstances, the Contractor may request that another reasonable valuation method be used including, but not limited to, accelerated depreciation, comparable sales, or established market values. In determining whether to approve such a request, the Department may consider any action taken, omission made, or unfortunate occurrence suffered by the Contractor with respect to the preservation of Project property withdrawn from appropriate use. (c) Financial Obligations to the State Government. The Contractor agrees to remit to the Department the State interest in the fair market value of any Project property prematurely withdrawn from appropriate use. !n the case of fire, casualty, or natural disaster, the Contractor may fulfill its obligations to remit the State interest by either: 1. Investing an amount equal to the remaining State interest in like-kind property that is eligible for assistance within the scope of the Project that provided State assistance for the Project property prematurely withdrawn from use; or 2. Returning to the Department an amount equal to the remaining State interest in the withdrawn Project property. i. Insurance Proceeds. If the Contractor receives insurance proceeds as a result of damage or destruction to the Project property, the Contractor agrees to: (1) Apply those insurance proceeds to the cost of replacing the damaged or destroyed Project property taken out of service, or (2) Return to the Department an amount equal to the remaining State interest in the damaged or destroyed Project property. j. Transportation -Hazardous Materials. The Contractor agrees to comply with applicable requirements of U.S. Pipeline and Hazardous Materials Safety Administration regulations, "Shippers -General Requirements for Shipments and Packagings," 49 C.F.R. Part 173, in connection with the transportation of any hazardous materials. k. Misused or Damaged Project Property. If any damage to Project property results from abuse or misuse occurring with the Contractor 's knowledge and consent, the NCDOT/PTD/FM Revised 8/4/2008 Page 2I of 28