Questions and Answers about Reservations of Use and Occupancy
At Indiana Dunes National Lakeshore
Many people have had questions about properties purchased by the National Park Service for inclusion into Indiana Dunes National Lakeshore. Unlike parks created from existing federal lands, Indiana Dunes National Lakeshore was established by Congress as a park to be created by purchasing land or accepting donated land. Since the park was authorized in 1966, the federal government has purchased hundreds of properties either by condemnation or willing seller. In some cases, people were allowed to live on the property after it was purchased by the NPS.
This Q&A is intended to answer the most common questions regarding properties the NPS has already acquired. For information regarding land not yet acquired, please see the separate Q&A on Land Acquisition.
1. What is a Reservation of Use and Occupancy?
A Reservation of Use and Occupancy (also referred to as a RUO or sometimes ROU) is a property that has been purchased by the National Park Service but with a provision in which the owner is allowed to remain on the property for a specified length of time.
2. Who owns the property?
An RUO is owned by the United States (the federal government).
3. Why can someone live in a house owned by the NPS?
When the property was purchased the owner had a choice of selling the property outright for full market value, or retaining the right to live in the house for a specified length of time (the RUO). If the owner chose the RUO option, then the owner was paid a reduced amount for the property based upon the value of the years of retained occupancy.
4. How long is an RUO?
The length of RUO is governed by the laws for Indiana Dunes National Lakeshore. Depending upon when the property was purchased, the RUO option was controlled by the law in place at that time. Some RUOs are for 20 or 25 years, some for the life of the seller, and some for other specified lengths of time.
5. Can the NPS extend the RUO when it expires?
No. The sale of the property was a sales contract between the United States and the owner. The NPS cannot alter, amend, or change the sales contract.
6. Why are you planning to put people out of their houses when their RUOs are ended?
The NPS is sympathetic to the emotions and personal needs of people who are in these properties and strives to make the transitions out of the houses as smooth as possible. It should be understood that these properties do not belong to the occupants: the properties were sold to the National Park Service. As part of their opportunity to occupy federal property the occupant is required to maintain the house and pay property taxes and utilities. At the end of the contracted time the occupants must vacate the houses. This is the same as when any private individual buys a house – the previous owners are contracted to vacate the premises.
7. What is a “leaseback.”
Leaseback is an inaccurate term that some people use to refer to property that is within its reservation of use period. In fact, the residents are not paying the federal government for use of the property and are not leasing them back from anyone. The retained right of occupancy is as specified in the sales contract. The residents pay no fees to the NPS. They pay a reduced property tax for services, but do not pay property tax for the full valuation of the property.
8. I know someone who lived in a house that does pay a rent to the NPS. Isn’t that a leaseback?
Some people who had expired RUOs were allowed to retain residence after the expiration of the RUO through the use of a Special Use Permit. These houses were limited in number. There were certain conditions that had to be met to allow a home to be under a Special Use Permit:
A. It is demonstrably to the advantage of the United States to allow the extended occupancy.
B. The extended occupancy of the ROU will not interfere with any current development plans for the national lakeshore or with resources management in the area.
C. The structure and the premises are free of major safety hazards and are in reasonably good repair. There is no evidence, as determined by an inspection, of the presence of hazardous materials or contaminants; in the event that inspection determines the presence of contaminants, removal is accomplished prior to issuance of a SUP for extension of occupancy.
D. The expiration date of any SUP extending ROU occupancy will not exceed the termination date of neighboring ROUs in the same general area.
E. Occupancy could not be extended beyond September 30, 2010.
No Special Use Permits have been issued, or will be issued, for expired RUOs after September 30, 2010.
9. What will the NPS do with these properties?
Most structures will be demolished and the sites restored to their natural condition. This is the purpose for which the NPS buys properties and the means by which Congress intended the National Park Service to create Indiana Dunes National Lakeshore.
10. Will all buildings be demolished?
The law allows the NPS to retain buildings for two reasons: to carry out the management functions of the park, or because the structures are historic. In these two cases buildings are not torn down.
11. If a building is declared historic, can the current occupants continue to live in it after the RUO expires?
No. No houses will be used for private residences even if the house is determined to be eligible as a historic property.
12. Aren’t the Century of Progress Homes (World’s Fair Houses) in Beverly Shores being used as private homes?
Yes. This is a special circumstance. These buildings are considered historic and the NPS wished to return them to the external appearance they had at the World’s Fair. Because federal funds were not available to pay for the restoration work, the NPS leased these buildings in exchange for private individuals contributing all costs of restoration. This was the best option available to save these buildings from complete deterioration. Individuals have put hundreds of thousands of dollars into the restoration of these buildings in exchange for the opportunity to live in them for a specified period of time. They do not own any of the buildings or property and must abide by NPS regulations. There are no expiring RUOs that are in a similar category of being historic and in needing this level of extensive repair.
13. What will the NPS do with other historic RUOs?
Of the recently expired RUOs in the park, there are approximately seven houses that may be considered historic structures as defined by the National Historic Preservation Act and retained by the NPS when the RUOs expire. The NPS is investigating options for maintaining these buildings. Possible ideas include allowing non-profit organizations to use them, allowing a park-related commercial use in them, or using them for some park needs. Persons and organizations who are interested in using any of these properties should contact the park with their ideas. Any use would have to meet NPS management goals, be compatible with the purposes of the park, and compatible with the area in which the buildings are located. Organizations using these buildings would assume all costs of repair, maintenance, and operation. No RUOs will be used as private residences.
14. Will the NPS use any of the RUOs for government employee housing.
15. How many RUOs, SUPs and Life Estates are there?
There were 26 RUOs that expired on September 30, 2010. There are an additional 9 RUOs that expire between 2013 and 2020. There were 19 Special Use Permits that also expired on 9/30/10. There are 4 life estates in the park.
16. Why did so many expire on the same date?
A 1980 law (PL96-612) set a definite date beyond which fixed-term RUOs would not extend. Persons whose property was acquired after this legislation could obtain a fixed term for up to 29 years. The law also gave the option of a life estate for the first time. In an attempt to be fair to those previously acquired who did not have the option for as lengthy a fixed-term, the legislation gave any current RUO owner with an initial term of not more than 20 years, a 3-year time period in which they could extend their RUO for up to 9 more years (e.g. a theoretical total of 29 years). The end result was that all homeowners at that time could have had the opportunity for a total fixed-term of between 24 to 29 years.
17. Are new RUOs offered?
Yes, Under current law, someone selling their property to the federal government can choose an RUO period that extends until no later than October 1, 2020, or a life estate.
18. Can someone move their house off the property and keep it?
Yes. This can be done. Persons interested in doing this should contact the park for more information.
19. Can I salvage a house after it has been vacated?
No. The National Park Service works with non-profits and other agencies to recycle and reuse materials whenever possible. When this is not possible, we contract for demolition and removal of the properties. The salvage value of materials is part of the contract and can help lower the costs to the government for the demolition. Removal of property without the permission or approval of the National Park Service is a crime.
20. Can the government buy my house if it is located outside the park boundaries?
No. The National Park Service can only purchase property within the boundaries of the park as set by Congress. We can accept property by donation if it is outside the boundary and is contiguous to the park boundary.