Top 10 Changes to the minimum requirements for ALTA surveys

#1: What's new with utilities?

The existence of utilities can significantly impact an owner’s or developer’s ability to realize the development potential of a piece of property. Utilities not only serve as evidence of possible easements, they are also critical components to the planning and design of a project. It’s no surprise, then, that the 2016 ALTA standards include significant changes to the requirements relating to utility locations.

Under the 2011 ALTA standards, the minimum requirement, in regard to locating utilities, is limited to those that serve as evidence of an easement or indicate the possibility of an encroachment. Beyond that, additional utility locations are typically negotiated between the surveyor and the client – usually by way of Optional Table A, Item 11(a) or Item 11(b). Item 11(a)  relates to the locations of observed evidence of utilities. Item 11(b) not only includes observed evidence, it also takes into account such things as existing plans and utility markings on the ground.

Optional Table A, Item 11, still exists in the 2016 ALTA standards, though it is no longer broken up into two different options. Instead, observed evidence of utilities (beyond those that serve as evidence of an easement) is now a minimum requirement under Section 5, titled, Fieldwork. In addition, Optional Table A, Item 11, is limited to one option - observed evidence of utilities collected in conjunction with the requirements of Section 5, along with evidence gathered through utility plans and markings. For all intents and purposes, Optional Table A, Item 11, under the 2016 ALTA standards, is analogous to Optional Table A, Item 11(b), under the current 2011 ALTA standards, with minor modifications.

What does this update mean to a client, owner, or developer?

Many selected Optional Table, A, Item 11(a) of the 2011 standards during the negotiation process with their surveyor. For others, the mandatory requirement to locate all observed utilities may add to the scope, timing, and cost of the ALTA survey, depending upon the nature of the particular piece of property. In the case of Optional Table A, Item 11, under the 2016 ALTA standards, the potential impact it can have on the survey scope could be great. Trying to map the existing utilities on a piece of property can be one of the most difficult and time-consuming portions of an ALTA survey. It is quite common to experience wait times of days or weeks for survey-related one-calls. Even after a locate request is made, utility locators may be unresponsive, especially during times of high demand (i.e. construction season). In addition, tracking down maps and plans of existing utilities can take considerable time, often requiring that the surveyor contact various agencies relating to the ownership of the utility. In many cases, the available maps are no more than scaled GIS drawings, providing a very vague indication of a utility’s existence and location. 

I was fortunate to participate in the design and construction of the award-winning CHS Field, a recently completed, 7,000-seat regional ballpark  in St. Paul, Minnesota. The project was a redevelopment within the Lowertown Historic District at the edge of downtown, making the existing utility infrastructure both vast and complex. It was extremely important to the planning and design of the project to have a comprehensive understanding of the utility infrastructure impacting the property. As part of the survey, extensive utility mapping was required. There were no fewer than 10 utility owners that responded to the state one-call request for utility locates, which included everything from water main and sewer, to gas, fiber, and phone. Needless to say, the mapping of the utilities on this project was a huge undertaking!  It took a great deal of time to organize and coordinate the utility effort, and convince the locate companies that it was in everyone’s best interest to have the utilities physically marked on the ground. 

The mandatory requirement to show all observed evidence of utilities will certainly have an impact on the cost, scope, and timing of ALTA surveys moving forward. It seems apparent, however, that this change in the 2016 ALTA standards reflects a greater desire by clients, lenders, and title companies to understand the impacts of utilities on real property. The due diligence process encompasses a great deal of risk mitigation measures, and utilities are no exception.

View #2: Phase 1 anybody?

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