Real Estate Legislative Update
2010 Minnesota Legislative Session

By: HIEP PHAM, MARY S. RANUM & MARK W. VYVYAN

August 2010

This legislative update contains information on new developments in real estate law from the 2010 Minnesota legislative session. The other article in this newsletter, by Larry Berg, describes amendments to the Minnesota Common Interest Ownership Act. Unless otherwise specified, the legislation described in this article is effective August 1, 2010.

FORECLOSURE REFORMS

Postponement of Foreclosure Sales

The Minnesota law regarding postponement of foreclosure sales has been amended. Owners or borrowers of properties subject to a foreclosure may postpone the foreclosure sale to prolong the reinstatement period. However, postponing the foreclosure sale will reduce the redemption period from 6 or 12 months to 5 weeks.

Under the amended statute, the sale of properties with a redemption period of 12 months may now be postponed by the owner or borrower for up to 11 months. Previously, whether the redemption period was 6 months or 12 months, the sale of the property subject to foreclosure could not be postponed for more than 5 months. Minn. Stat. § 580.07(2). This amendment became effective on May 15, 2010.

Eviction of Tenants in Properties Subject to Foreclosure

The Minnesota Legislature has codified the Protecting Tenants at Foreclosure Act of 2009. The purpose of this law is to protect the rights of tenants in properties subject to foreclosure. It applies to all eviction actions commenced before December 31, 2012, and will not apply to eviction actions commencing on or after January 1, 2013.

90 Days’ Written Notice to Vacate Required

Tenants, under any lease excluded after the date the mortgage was signed and before the end of the redemption period, occupying a property subject to foreclosure must be allowed to stay until at least 90 days after the redemption period ends. Minn. Stat. § 504B.285(1a)(a). Before an eviction action may be commenced, 90 days’ written notice to vacate must be given to the tenant and the notice can be given no sooner than the last day of the redemption period. This provision applies to tenants who enter a lease after the mortgage is executed but before the redemption period expires. The tenant must continue to pay rent and abide by all the terms of the lease.

Enforceability of a Preexisting Lease

In addition to the 90 days’ notice to vacate requirement, tenants occupying a property subject to foreclosure under a “bona fide” lease must be allowed to stay until the end of the lease. Minn. Stat. § 504B.285(1a)(b). A lease is a bona fide lease if:

• The tenant is not the mortgagor or a child, spouse, or parent of the mortgagor;
• The lease was the result of an arm’s length transaction where there is no conflict of interest between the parties; and
• The rent is not substantially less than the fair market rent for the property or the rent is reduced or subsidized by a federal, state, or local subsidy.

The bona fide lease must be honored by the new owner until either the lease expires or the new owner (or the immediate successor to the new owner) elects to use the property as a primary residence. If the property will be used as a primary residence by the new owner (or the immediate successor to the new owner), before the eviction action may be commenced, the new owner must provide 90 days’ written notice and the notice can be given no sooner than the last day of the redemption period. Before an eviction action may be commenced, the new owner must provide 90 days’ written notice to vacate to the tenant and the notice can be effective no sooner than the day the lease expires. The tenant must continue to pay rent and abide by all the terms of the lease. A Section 8 tenant under a lease in a property subject to foreclosure will be treated as if the tenant has a bona fide lease. Minn. Stat. § 504B.285(1a)(c).

Notice Requirements

The Minnesota Legislature has implemented new notice requirements to ensure that owners or borrowers of properties subject to foreclosure are properly informed of their rights. These requirements apply to properties with one to four dwelling units, one of which is owner occupied at the beginning of a foreclosure.

Foreclosure Advice Notice

Whenever a property is to be foreclosed, Minnesota law requires a foreclosure advice notice to be included with a notice of foreclosure. The template for the foreclosure advice notice has been modified to include the contact information for the U.S. Department of Housing and Urban Development. A template of the foreclosure advice notice can be found in Minn. Stat. § 580.041(2).

Notice of Redemption Rights

In addition to the foreclosure advice notice, Minnesota law now requires a notice of redemption rights to be delivered with a notice of foreclosure. The purpose of this new law is to avoid abuse based on ignorance of redemption rights. Specific requirements for typeface and printing, as well as a template of the notice of redemption rights, are provided in Minn. Stat. § 580.041.

Notice of Results of Sale

Minnesota law now requires a notice of results of sale to be provided to an owner or borrower of a property subject to foreclosure. The law applies to any party attempting to purchase the property after it has been auctioned at a foreclosure sale, but before the end of the redemption period. Minn. Stat. § 580.06(2). This notice is required for all foreclosure sales conducted between August 1, 2010, and December 31, 2012.

The notice of results of sale must be personally delivered to the owner or borrower of the property subject to foreclosure 3 days before entering into an agreement to purchase the property. The purpose of this notice is to prevent a party from abusing an owner’s ignorance of the fact that the property subject to foreclosure has been auctioned, the auction price, or the owner’s redemption rights. The notice must include the following:

• The date the foreclosure sale occurred;
• The identity of the purchaser;
• The foreclosure sale price; and
• The exact statement provided in § 580.06(2)(b)(4) detailing the redemption rights of the owner or borrower of the property subject to foreclosure.

The following persons and entities are not required to provide a notice of results of sale:

• A seller or buyer who has an agreement with a real estate agent licensed under chapter 82 to buy or sell the property subject to foreclosure;
• A buyer offering to pay a price equal to or greater than the price required to redeem the property subject to foreclosure;
• A foreclosing lender acquiring the property subject to foreclosure by a deed in lieu of foreclosure;
• A nonprofit lender who holds a certificate of exemption from the Minnesota Department of Commerce; or
• The state or local unit of government or an agent of the same.

Any person who is required to provide a proper notice of results of sale but fails to do so may be liable for actual, incidental, and consequential damages; $1,000 statutory damages; and costs, disbursements, and reasonable attorney fees. Minn. Stat. § 580.06(3)(a).

A person who is required to provide a notice of results of sale may record an affidavit stating that the owner or borrower of the property subject to foreclosure received the required notice. Minn. Stat. § 580.06(3)(b). The affidavit must be made by a person having knowledge of the facts and will serve as evidence that proper notice was given to the owner or borrower of the property subject to foreclosure.

Foreclosure Costs

If a property subject to foreclosure is abandoned by the occupant, a political subdivision may initiate a proceeding to reduce the redemption period to 5 weeks. Minnesota law now provides that if such an order is entered to reduce the redemption period, the court will award costs and disbursements to the political subdivision. The party foreclosing the mortgage or holding the sheriff’s certificate of sale is liable for these costs. Minn. Stat. § 582.032(9).

If the owner or borrower of the property subject to foreclosure returns and reinstates the mortgage or redeems the property, the liability for costs and disbursements awarded to the political subdivision is shifted to the owner or borrower. Minn. Stat. §§ 580.30(1); 582.03(1).

LANDLORD/TENANT AMENDMENTS

Receipt for Rent Paid in Cash

A new Minnesota law now requires a landlord to immediately provide a written receipt to a tenant if the landlord receives a cash payment from a tenant in person. If a cash payment is not made in person, a landlord has three business days to provide the tenant with a written receipt. Minn. Stat. § 504B.118.

Recovery of Attorney Fees by Tenant

If a residential lease specifies that a landlord may recover attorney fees from a tenant in certain types of actions, then the tenant may also recover attorney fees from the landlord in the same types of actions if the tenant prevails. Minn. Stat. § 504B.172. This new provision affects leases entered into on or after August 1, 2011, and leases renewed on or after August 1, 2012.

Applicant Screening Fee

The Minnesota legislature has made numerous changes to ensure that applicant screening fees will be used for their intended purpose.

Limitations

Minnesota law now imposes new limitations regarding when a landlord may collect or use applicant screening fees. In addition to being prohibited from collecting applicant screening fees for units that are not available, a landlord is now prohibited from using, cashing, or depositing an applicant screening fee until all prior applicants have been screened and rejected or have declined to take the unit. A landlord must also provide a written receipt for the screening fee upon request of the applicant. Minn. Stat. § 504B.173.

Disclosures to Applicant

Prior to accepting a screening fee from an applicant, a landlord must now disclose in writing the name, address, and telephone number of the screening service the landlord will use. Previously, this disclosure could have been made orally by the landlord.

The landlord must also provide in writing the criteria on which the decision to rent will be based. If an applicant is rejected, the landlord must notify the applicant within 14 days of which criteria the applicant failed to meet. Minn. Stat. § 504B.173(3).

Return of Applicant Screening Fee

This Minnesota law has been expanded to include additional circumstances in which a landlord must return a screening fee to an applicant. A screening fee must be returned to an applicant if a landlord does not perform a reference check or obtain a consumer credit or tenant screening report. The landlord must also return any amount of the screening fee not used for these purposes.

Under the new amendment, a landlord must now return a screening fee if the applicant is rejected for any reason that has not been previously disclosed as criteria on which the decision to rent would be based. The screening fee must also be returned if the unit has been offered and accepted by another applicant. Minn. Stat. § 504B.173(2).

Remedies

The scope of this statute has been expanded to protect landlords when tenants have acted in bad faith. Previously, this section only provided remedies for applicants in situations where a landlord violated this section. This statute now provides remedies for landlords where an applicant has omitted material information or provided materially false information on an application. Minn. Stat. § 504B.173(4). In such cases, the landlord may recover damages from the applicant including court filing fees as well as reasonable attorney fees. In addition, the applicant may face a civil penalty up to $500.

Late Fees

Minnesota law now provides that a landlord of a residential building may not assess late fees for rent unless the landlord and tenant have agreed in writing that a late fee may be imposed. The agreement must specify the date the late fee will be imposed and the fee cannot be greater than 8 percent of the rent due. Even if there is no written agreement, a landlord may still assess late fees in accordance with a federal statute, regulation, or handbook, if a tenant is subsidized under a federal program. Minn. Stat. § 504B.177. This new law becomes effective January 1, 2011, for leases entered into or renewed on or after that date.

Security Deposits

A landlord of a residential building who keeps a tenant’s security deposit in bad faith is now subject to punitive damages up to $500. Minn. Stat. § 504B.178(7). Previously, punitive damages for this type of conduct were capped at $200. A deposit is retained in bad faith if the landlord fails to return the deposit to the tenant or fails to offer a written statement citing the specific reason why the deposit is being retained in accordance with Minn. Stat. § 504B.178(3) and (5).

Abandoned Property

Disposal of Property

The Minnesota legislature has significantly reduced the amount of time a landlord must hold and store personal property abandoned by a tenant. A landlord may now sell or dispose of abandoned personal property 28 days after it reasonably appears that the tenant has abandoned the property or upon receiving notice of abandonment. Minn. Stat. § 504B.271(1). Previously, a landlord was required to wait 60 days before selling or disposing of the abandoned personal property.

Notification of Disposal

Minor clarifications have been made to the notice requirements regarding abandoned property. A landlord must still notify a tenant 14 days before the sale of the tenant’s abandoned personal property. If this notice is made by mail, it must now be made by first-class, certified mail. If notification by mail is used, then the 14-day period begins on the day the notice is deposited in the United States Mail. Minn. Stat. § 504B.271(1)(d).

Punitive Damages Increased

A landlord who fails to allow a tenant to retake possession of abandoned personal property in a timely fashion, in addition to actual damages and reasonable attorney’s fees, is now liable for punitive damages up to either twice the amount of actual damages or $1,000, whichever amount is greater. Minn. Stat. § 504B.271(2). Previously, the punitive damages were capped at $300.

Eviction of Tenants for Nonpayment of Rent

Under Minnesota law, a landlord may bring an eviction action against a tenant for nonpayment of rent. This statute now provides a rebuttable presumption that rent has been paid if the tenant can produce copies of money orders or original receipt stubs showing the purchase of money orders. These documents must reflect the total amount of the rent owed and must be dated around the time the rent was due. If the document is a money order, it must show that the money order was made payable to the landlord. The landlord may produce evidence to rebut this presumption. Minn. Stat. § 504B.291(1).

HOMEBUILDING AND REMODELING

Lead Paint Certification for Residential Properties

A new Minnesota law now requires workers renovating a residential structure built prior to 1978 to be certified to perform lead work pursuant to Environmental Protection Agency regulations found in the Code of Federal Regulations Title 40 § 745.89. Minn. Stat. § 362B.106(14). Before work permits may be issued to these types of workers, a municipality is now required to verify the workers’ lead certification. Minn. Stat. § 362B.106. Workers must be able to provide the municipality with enough information to verify proof of certification and the municipality is permitted to assess a surcharge for verification of lead certification under Minn. Stat. § 326B.815(2). This new law becomes effective February 1, 2011.

Local Ordinance Restrictions

Under Minn. Stat. § 326B.121(c), municipalities are prohibited from enacting an ordinance requiring a building code that is in conflict with the State Building Code. With approval from the state building official, however, a municipality may adopt an ordinance that is more restrictive that the State Building Code where geologic conditions warrant the more restrictive ordinance.

This law has been amended to allow municipalities to enforce a local ordinance that requires existing components or systems of a structure to be maintained in a safe and sanitary condition or in good repair. The ordinance, however, may not exceed the standards under which the structure was built, reconstructed, altered, or installed, unless specific retroactive provisions for existing buildings have been adopted as part of the State Building Code. This amendment became effective on May 11, 2010.

Home Warranties

Minnesota law requires any vendor selling a completed dwelling, or home improvement contractor, to warrant to the buyer or owner that the dwelling is free from faulty workmanship, defective materials, or major construction defects due to noncompliance with building standards. All amendments to this law become effective on January 1, 2011.

Inspection Repairs

In the event a vendor or home improvement contractor breaches a home warranty, they must be allowed to inspect the property to prepare an offer to repair the alleged damages. This law has been amended and now requires a vendor or contractor that has damaged the property as a result of the inspection to promptly repair the property to its pre-inspected condition. Minn. Stat. § 327A.02(4)(a).

Agreement to Repair

A new law has been enacted that requires a vendor or home improvement contractor to provide the buyer or owner a written offer to repair the breach of warranty within 15 days of inspection. The offer must provide at a minimum the scope of the proposed work and an estimated date of completion. Minn. Stat. § 327A.02(5). Upon completion of the repairs, the vendor or contractor must provide the buyer or owner a written notice that the scope of the work agreed upon has been completed. If there is a disagreement as to the scope of work required to remedy the breach of warranty, the matter must be submitted to the homeowner warranty dispute resolution process under Minn. Stat. § 327A.051.

Failure to Perform Inspection or Repair

A new law now provides that if a vendor or home improvement contractor fails to perform an inspection of the alleged breach of warranty, make an offer to repair, or perform the agreed-upon repairs, the buyer or owner may commence an action against the vendor or contractor. Minn. Stat. § 327A.02(6).

In all other cases, an action must not be commenced in district court until either the completion of the home warranty dispute resolution process under § 327A.051 or 60 days after the written offer of repair is provided to the buyer or owner. Minn. Stat. § 327A.02(7).

Tolling of Statute of Limitations

The law addressing the tolling of the statute of limitations for breach of warranty has been amended in light of the new home warranty dispute resolution process. Previously, the statute of limitations is tolled from the date written notice of the alleged breach is postmarked, or if not sent by mail, received by the vendor or contractor, until either: (1) the buyer or owner rejects the vendor or contractor’s offer to repair the breach; (2) the vendor or contractor rejects the buyer or owner’s notice of breach; (3) failure by the vendor or contractor to offer to repair the breach within 30 days of receiving notice; or (4) the passing of 180 days.
Under the new amendment, the tolling of the statute of limitations still begins from the date written notice of the alleged breach is postmarked, or if not sent by mail, received by the vendor or contractor. Now, however, the tolling of the statute of limitations ends at the completion of the home warranty dispute resolution process or the passing of 180 days, whichever occurs later. Minn. Stat. § 327A.02(4)(b).

Home Warranty Dispute Resolution

A new law now provides for a dispute resolution process purposed toward resolving disagreements arising from breach of warranty by vendors or home improvement contractors. This legislative update provides only a summary of the home warranty dispute resolution process. For additional details, please see Minn. Stat § 327A.051.

Process

The commissioner of labor and industry will maintain a list of qualified neutrals for the purpose of dispute resolution. Upon written application to the commissioner, three randomly selected qualified neutrals will be provided to the parties in dispute. After a neutral is selected by the parties, an in-person conference will be scheduled by the neutral no later than 30 days after the neutral is selected, unless the parties mutually agree on a later date. Each party must provide the neutral all the necessary information and documentation to understand the dispute or alleged damages. Within 10 days after the conference, the neutral will mail a nonbinding determination to each party. Minn. Stat. § 327A.051(1)-(3).

Cost and Fees

Parties of the home warranty dispute resolution process are required to pay a $25 administrative fee to the commissioner of labor and industry. The parties must also equally share the cost of the neutral’s billed time not to exceed 6 hours, unless agreed to in writing by both parties. Minn. Stat. § 327A.051(3).

Alternative Process

Upon agreement of both parties, an alternative dispute resolution process may be used in lieu of the home warranty dispute resolution process. If the home warranty dispute resolution process has already commenced, written notice must be provided to the commissioner as soon as practicable, but no later than the date the parties are required to select a neutral. Minn. Stat. § 327A.501(4).

Effect on Future Proceedings

The written determination of the neutral, and all communications relating to the home warranty dispute resolution process, are confidential settlement communications pursuant to Rule 408 of the Minnesota Rules of Evidence. In any subsequent litigation between the parties, the neutral may not be called upon to testify regarding the dispute resolution proceedings and the neutral’s written determination may not be used as evidence of liability. Minn. Stat. § 327A.051(5).

MORTGAGES: ENFORCEABILITY OF INSTRUMENTS SECURING DEBT

The law regarding instruments securing debt has been amended to clarify the amount for which an instrument may be enforced. A debt instrument may not be enforced for a debt larger than the debt initially specified in the instrument. This is true for debt instruments securing an entire debt, or securing only a portion of a debt. Minn. Stat. § 287.03. This amendment became effective July 1, 2010, and applies to all instruments securing a debt.

REQUIREMENTS OF RESIDENTIAL CONTRACTS FOR DEED

The Minnesota Legislature amended this statute to provide a definition for the terms “contract for deed” and “residential real property.” The statute requires that a vendor entering into a contract for deed involving a residential real property must, at the time of the execution of the contract for deed, deliver an original, recordable copy of the contract for deed to the vendee and pay any delinquent taxes required to record the contract for deed (unless the contract provides otherwise). For the purposes of this statute, the amendment defines “contract for deed” and “residential real property” as follows:

• Contract for deed – An executory contract for the conveyance of a residential real property where the seller provides financing for the purchase of the property and under which the purchaser has a right to go into possession. A contract for deed does not include a purchase agreement; an earnest money contract; an exercised option or lease (including leases with an option to purchase); or a mortgage.
• Residential real property – Real property occupied, or intended to be occupied, by one to four families if the purchaser intends to occupy the real property. Residential real property does not include property subject to a family farm security loan or a transaction subject to §§ 583.20 to 583.32.

Minn. Stat. § 507.235(1a). This section is effective the day following final enactment and applies to contracts for deeds acknowledged on or after the effective date.

CHILD SUPPORT JUDGMENTS AND TITLE SEARCHES

Minnesota child support laws have been amended to extend the enforceability of child support judgments from 10 years to 20 years. Minn. Stat. § 541.04. This amendment may adversely affect the accuracy of title searches. Generally, title searches reveal judgments only within the last 10 years and do not distinguish between a child support judgment and other types of judgments. By extending the enforceability of child support judgments, title searches will not be able to provide an accurate list of outstanding judgments against a property. The effective date of this amendment has been pushed back from January 1, 2011, to July 1, 2011, so that this potential problem affecting title searches may be addressed in the next legislative session.

PRIVATE TRANSFER FEES

The Minnesota Legislature has deemed private transfer fees that run with a property to be against public policy and are invalid and unenforceable. Minn. Stat. § 513.74. The purpose of this law is to help promote and facilitate the conveyance of real property and to prevent abuse of people who are unfamiliar with these types of fees. All private transfer fees found in agreements entered into after May 20, 2010, are invalid and unenforceable. Preexisting transfer fees, however, may be enforced if the provisions of this statute are followed.

Liability for Violations

A person who records, files, or enters into an agreement to impose a private transfer fee is liable for all damages resulting from imposition of the fee. Minn. Stat. § 513.75. This includes, but is not limited to, the amount of the transfer fee paid, any attorney fees, and other costs relating to recovery of the transfer fee paid or an action to quiet title of the property. If an agent acts on behalf of a principal to impose a private transfer fee, liability is imposed on the principal and not to the agent.

Definition

A private transfer fee generally runs with a property; that is, it continues to apply to each transfer of the property, and requires payment to a private party upon a transfer of interest in the property. Because these fees run with the property, all successors to the property are obligated to pay the transfer fee. These fees can be a fixed amount or a percentage of the value of the property or purchase price. Minn. Stat. § 513.73. The following are not considered to be private transfer fees:

• Any consideration for a property and any subsequent consideration for appreciation, development, or sale of the property. The consideration must be a onetime payment and the obligation to pay must not bind successors in title to the property;
• Commissions payable to a licensed real estate broker and commission for subsequent appreciation, development, and sale of the property;
• Interest, charges, or fees payable to a lender in connection with a loan secured by a mortgage against a property;
• Rent, reimbursement, charge, or fee from a lessee to a lessor under a lease. This includes fees for assignment, subletting, encumbrance, or transfer of the lease;
• Consideration payable to a holder of an option to purchase, first right of refusal, or first offer to purchase for waiving, releasing, or not exercising the option or right;
• Consideration payable by a contract for deed to the vendor including any subsequent consideration for appreciation, development, or sale of the property;
• A tax, fee, charge, assessment, fine, or other amount payable to a governmental authority;
• A fee, charge, assessment, fine, or other amount payable to a homeowner’s condominium, cooperative, mobile home, or property owner’s association pursuant to a declaration, covenant, or law applicable to the association;
• A fee, charge, assessment, dues, contribution, or other amount pertaining to the purchase or transfer of a club membership relating to real property owned by the member; and
• A mortgage.

Notice Requirements for Existing Private Transfer Fee Obligations

The Minnesota Legislature has imposed notice requirements for all private transfer fee obligations imposed prior to August 1, 2010. The recipient of a private transfer fee must record or file a separate document with the county recorder or the registrar of titles in the county where the real property is located by December 31, 2010. Minn. Stat. § 513.76(1). The document must include the following:

• The title of “Notice of Private Transfer Fee Obligation” in at least 14-point boldface type;
• The amount of the private transfer fee or the manner in which the amount of the fee is to be calculated;
• The date or circumstances under which the obligation to pay the private transfer fee will expire, if any;
• How the private transfer fee will be used;
• The name and contact information of the person or entity receiving the private transfer fee;
• The acknowledged signature of the person or entity receiving the private transfer fee; and
• The legal description of the real property burdened by the private transfer fee.

Noncompliance to Notice Requirements

Failure to comply with the notice requirements set forth above will render the private transfer fee void. The grantor of the property burdened by the fee may freely convey any interest in the property without being subject to the private transfer fee. Minn. Stat. § 513.76(3)(a). Any subsequent conveyance of the property will also not be subject to the private transfer fee. This statute becomes effective January 1, 2011.

Written Statement Requirement

Even if the receiver of a private transfer fee complies with the notice requirements set forth above, the receiver of the fee is still under an obligation to provide a written statement of the transfer fee payable. Minn. Stat. § 513.76(3)(b). If the written statement is not provided within 30 days of a written request for the statement, the burdened property may be conveyed without payment of the transfer fee, and all subsequent conveyance of the property shall be conveyed free and clear of the private transfer fee so long as the affidavit requirement described below is satisfied. This statute becomes effective January 1, 2011.

Affidavit Requirement

In the case that a recipient of a private transfer fee has complied with the notice requirement, but has failed to respond to a request for a written statement of the transfer fee payable, the grantor of a property burdened by the transfer fee must file an affidavit prior to or simultaneously with the conveyance of the property in order to be free of the private transfer fee. Minn. Stat. § 513.76(4). The affidavit will serve as evidence that a request for a written statement of the transfer fee payable was made and that no statement was received within 30 days of the request. The affidavit must include the following:

• A legal description of the property;
• The name of the owner of the property at the time of the signing of the affidavit; and
• A reference to the instrument of record containing the obligation to pay the private transfer fee.

PROBLEM PROPERTIES: SECURING VACANT BUILDINGS

When an owner of a vacant or unoccupied building is issued an order under Minn. Stat. § 463.251(2) deeming the building hazardous, the owner now has 6 days to request a hearing on the order. Minn. Stat. § 463.251(3). Previously, an owner had 14 days to request a hearing. If a hearing is not requested, or if there is a failure to comply with the order, the governing body may properly secure the building and cost will be assessed to the real estate pursuant to Minn. Stat. § 463.21.

CONDITIONAL USE DEEDS

The Minnesota Legislature has made significant changes concerning the classification, sale, and conveyance of tax forfeited lands to public entities. Those changes are briefly summarized in this update. Please refer to Minn. Stat. § 282.01 for additional information.

A county board has the discretion to manage tax forfeited lands and decide which properties should be used for public benefit and which properties should be returned to private ownership. Minn. Stat. § 282.01(1). The board must also classify land as either conservation or nonconservation land, which will determine how the land may be used. The classification procedures followed by the county board can be found in Minn. Stat. § 282.01.

A state agency or governmental subdivision may request the county board to release to it tax forfeited lands. The land may be sold or conveyed, at the county board’s discretion, under a conditional use deed to the state agency or governmental subdivision. Minn. Stat. § 282.01(1a). If the land is not used in accordance with the conditional use deed, the state agency or governmental subdivision may purchase the land at market price without the use restriction or convey the land back to Minnesota. If the land is used in accordance with the conditional use deed for at least 15 years, then the commissioner of revenue may quit claim the property to the state agency or governmental subdivision. Minn. Stat. § 282.01(1d). These amendments became effective July 1, 2010.