California ex rel. Department of Transportation v. U. S. ex rel. Department of Transportation

The State of California sued the United States for reimbursement of interest paid in obtaining a voluntary right of entry for the construction of a portion of Interstate Highway 5. The district judge granted summary judgment to the United States on the ground that the provisions of Policy and Procedure Memorandum (PPM) 80 — 4, Ü 3i, a Federal Highway Administration directive, 1 apply to limit the amount of interest which the United States is legally obligated to pay. We affirm.

I.

Pursuant to the provisions of the Federal-Aid Highways Act, 23 U.S.C. §§ 101 et seq., representatives of the federal government and the State of California entered into an agreement for the construction of a portion of Interstate 5 in Siskiyou County, California. As contemplated by the Act, the federal government agreed to pay 90% of the total cost of the project and the State agreed to undertake the actual construction, subject to the approval of the Secretary of Transportation. In connection with the construction of the highway, the State took steps to acquire the necessary right-of-way, including the parcel of land giving rise to this dispute.

Under California law, a condemnor may obtain from a…