HF 1887

as introduced - 86th Legislature (2009 - 2010) Posted on 02/09/2010 01:56am

A bill for an act
relating to housing; providing for rehabilitation of vacant and abandoned
housing due to foreclosure crisis; protecting the health, safety, and welfare of
the community through appropriate police powers; providing legal process to
appoint receivers for abandoned properties and recovery of funds expended to
bring property up to code; proposing coding for new law in Minnesota Statutes,
chapter 463.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [463.27] MINNESOTA NEIGHBORHOOD RENEWAL ACT.
new text end

new text begin Sections 463.271 to 463.274 may be referred to as the "Minnesota Neighborhood
Renewal Act."
new text end

Sec. 2.

new text begin [463.271] DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Scope. new text end

new text begin As used in sections 463.271 to 463.274, the terms defined in
this section have the meanings given them.
new text end

new text begin Subd. 2. new text end

new text begin Last known address. new text end

new text begin "Last known address" includes the address where
the property is located or the recorded address as listed in the applicable tax records.
new text end

new text begin Subd. 3. new text end

new text begin Nonprofit housing organization. new text end

new text begin "Nonprofit housing organization" or
"organization" means a nonprofit corporation organized under chapter 317A that has
as one of its purposes the improvement of housing or stabilization of neighborhoods.
Nonprofit housing organization further includes, but is not limited to, a nonprofit
community development corporation or a neighborhood association.
new text end

new text begin Subd. 4. new text end

new text begin Nuisance. new text end

new text begin "Nuisance" means any property that because of its physical
condition or use is:
new text end

new text begin (1) a public nuisance, pursuant to sections 617.80 and 617.92;
new text end

new text begin (2) a private nuisance, pursuant to section 561.01;
new text end

new text begin (3) a hazardous building or hazardous condition, pursuant to section 463.16;
new text end

new text begin (4) vacant and boarded for 180 days; or
new text end

new text begin (5) condemned or without a certificate of occupancy due to local code or ordinance
violations for 180 days.
new text end

new text begin Subd. 5. new text end

new text begin Parties in interest. new text end

new text begin "Parties in interest" means any owner or owners of
record, judgment creditor, tax purchaser, or other party having a recorded interest in the
property.
new text end

new text begin Subd. 6. new text end

new text begin Property. new text end

new text begin "Property" means the building, structure, or land that is the
subject of an action pursuant to the Minnesota Neighborhood Renewal Act.
new text end

new text begin Subd. 7. new text end

new text begin Property owner. new text end

new text begin "Property owner" means the owner or owners of record
of the property for tax purposes.
new text end

new text begin Subd. 8. new text end

new text begin Rehabilitation. new text end

new text begin "Rehabilitation" or rehabilitate" means the process
of improving the property, including, but not limited to, bringing the property into
compliance with applicable state and local fire, housing, and building codes.
new text end

Sec. 3.

new text begin [463.272] REQUIREMENTS AND RELIEF.
new text end

new text begin Subdivision 1. new text end

new text begin General requirements. new text end

new text begin An action pursuant to the Minnesota
Neighborhood Renewal Act shall be taken only:
new text end

new text begin (1) by a person acting on behalf of a state, county, municipality, or nonprofit housing
organization;
new text end

new text begin (2) if the subject property is a nuisance; and
new text end

new text begin (3) service has been made upon all parties in interest at last known address.
new text end

new text begin Subd. 2. new text end

new text begin Access to property. new text end

new text begin The court has the authority to grant any party access
to the property for the purpose of determining necessary actions pursuant to sections
463.27 to 463.274.
new text end

new text begin Subd. 3. new text end

new text begin Relief. new text end

new text begin (a) A person acting on behalf of a state, county, municipality, or
nonprofit housing organization may seek any of the following relief from the court:
new text end

new text begin (1) an injunction requiring the property owner to rehabilitate the property, including
but not limited to an order for the property owner to:
new text end

new text begin (i) comply with state law;
new text end

new text begin (ii) comply with local ordinances and codes; and
new text end

new text begin (iii) take actions deemed necessary by the court to eliminate the existing or ongoing
nuisance;
new text end

new text begin (2) the appointment of a receiver to rehabilitate the property, including but not
limited to an order for the receiver to cause the property to:
new text end

new text begin (i) comply with state law;
new text end

new text begin (ii) comply with local ordinances and codes; and
new text end

new text begin (iii) take actions deemed necessary by the court to eliminate the existing or ongoing
nuisance; and
new text end

new text begin (3) attorney fees and costs.
new text end

new text begin (b) The court shall authorize the receiver, if appointed under paragraph (a), clause
(2), to recover its costs, including attorney fees, by the issuance of a receiver's certificate
or note identifying such costs and bearing any interest fixed by the court, and, after its
initial issuance, the certificate or note shall be freely transferable and shall be a first lien
upon the real estate and the rents and issues on the real estate, and superior to all prior
assignments of rents, prior existing liens, prior existing mortgages, and prior existing
encumbrances, except taxes; if, within 90 days of issuance of the receiver's certificate or
note, the holder of the receiver's certificate or note files a notice of lien in the office of the
recorder in the county in which the real estate is located or in the office of the registrar of
titles. The notice of the lien filed must contain:
new text end

new text begin (1) a description of the real estate affected sufficient for its identification;
new text end

new text begin (2) the face amount of the receiver's certificate or note that was sold or transferred
for value by the receiver;
new text end

new text begin (3) the date when the receiver's certificate or note was issued by the court; and
new text end

new text begin (4) that the lien is placed on the property to recover for rehabilitation costs under the
Minnesota Neighborhood Renewal Act.
new text end

Sec. 4.

new text begin [463.273] RELEASE OF LIEN.
new text end

new text begin Upon payment to the holder of the receiver's certificate or note of the face amount of
the certificate or note together with any interest on it, the lien of such certificate must be
released.
new text end

Sec. 5.

new text begin [463.274] ENFORCEMENT OF LIEN.
new text end

new text begin Subdivision 1. new text end

new text begin Default. new text end

new text begin The date of default is deemed to occur 90 days from the
date of issuance of the receiver's certificate or note, if at that time the note or certificate
remains unpaid in whole or in part.
new text end

new text begin Subd. 2. new text end

new text begin Separate proceeding. new text end

new text begin The lien may be enforced by proceedings to
foreclose as in the case of mortgages or mechanics' liens, by advertisement pursuant to
chapter 580 or foreclosure by action pursuant to chapter 581, and an action to foreclose
the lien may be commenced at any time after the date of default.
new text end

new text begin Subd. 3. new text end

new text begin Control of the property. new text end

new text begin After the issuance of receiver's certificate or
note, the receiver is entitled to remain in possession of the property until the certificate or
note is paid or the foreclosure process is completed.
new text end