1.1                          A bill for an act 
  1.2             relating to real property; establishing the Electronic 
  1.3             Real Estate Recording Task Force; appropriating money; 
  1.4             amending Minnesota Statutes 2004, sections 507.093; 
  1.5             507.24, subdivision 2; proposing coding for new law in 
  1.6             Minnesota Statutes, chapter 507. 
  1.7   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  1.8      Section 1.  Minnesota Statutes 2004, section 507.093, is 
  1.9   amended to read: 
  1.10     507.093 [STANDARDS FOR DOCUMENTS TO BE RECORDED OR FILED.] 
  1.11     (a) The following standards are imposed on documents to be 
  1.12  recorded with the county recorder or filed with the registrar of 
  1.13  titles: 
  1.14     (1) The document shall consist of one or more individual 
  1.15  sheets measuring no larger than 8.5 inches by 14 inches. 
  1.16     (2) The form of the document shall be printed, typewritten, 
  1.17  or computer generated in black ink and the form of the document 
  1.18  shall not be smaller than 8-point type.  
  1.19     (3) The document shall be on white paper of not less than 
  1.20  20-pound weight with no background color, images, or writing and 
  1.21  shall have a clear border of approximately one-half inch on the 
  1.22  top, bottom, and each side.  
  1.23     (4) The first page of the document shall contain a blank 
  1.24  space at the top measuring three inches, as measured from the 
  1.25  top of the page.  The right half to be used by the county 
  1.26  recorder for recording information or registrar of titles for 
  2.1   filing information and the left half to be used by the county 
  2.2   auditor or treasurer for certification.  
  2.3      (5) The title of the document shall be prominently 
  2.4   displayed at the top of the first page below the blank space 
  2.5   referred to in clause (4).  
  2.6      (6) No additional sheet shall be attached or affixed to a 
  2.7   page that covers up any information or printed part of the form. 
  2.8      (7) A document presented for recording or filing must be 
  2.9   sufficiently legible to reproduce a readable copy using the 
  2.10  county recorder's or registrar of title's current method of 
  2.11  reproduction.  
  2.12     (b) The standards in this paragraph (a) do not apply to a 
  2.13  document that is recorded or filed as part of a pilot project 
  2.14  for the electronic filing of real estate documents implemented 
  2.15  by the task force created in Laws 2000, chapter 391., or under 
  2.16  the Electronic Real Estate Recording Task Force created under 
  2.17  section 507.094.  A county that participated in the pilot 
  2.18  project for the electronic filing of real estate documents under 
  2.19  the task force created in Laws 2000, chapter 391, may continue 
  2.20  to record or file documents electronically, if: 
  2.21     (1) the county complies with standards adopted by that task 
  2.22  force; and 
  2.23     (2) the county uses software that was validated by that 
  2.24  task force. 
  2.25  A county that did not participate in the pilot project may 
  2.26  record or file a real estate document electronically, if: 
  2.27     (i) the document to be recorded or filed is of a type 
  2.28  included in the pilot project for the electronic filing of real 
  2.29  estate documents under the task force created in Laws 2000, 
  2.30  chapter 391; 
  2.31     (ii) the county complies with the standards adopted by the 
  2.32  task force; 
  2.33     (iii) the county uses software that was validated by the 
  2.34  task force; and 
  2.35     (iv) the task force created under section 507.094 approves 
  2.36  a written request from the county board and county recorder of 
  3.1   the county to implement electronic filing under this section.  
  3.2      (b) (c) The recording or filing fee for a document that 
  3.3   does not conform to the standards in paragraph (a) shall be 
  3.4   increased as provided in sections 357.18, subdivision 5; 508.82; 
  3.5   and 508A.82. 
  3.6      (c) (d) The recorder or registrar shall refund the 
  3.7   recording or filing fee to the applicant if the real estate 
  3.8   documents are not filed or registered within 30 days after 
  3.9   receipt, or as otherwise provided by section 386.30. 
  3.10     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
  3.11  following final enactment. 
  3.12     Sec. 2.  [507.094] [ELECTRONIC REAL ESTATE RECORDING TASK 
  3.13  FORCE.] 
  3.14     Subdivision 1.  [CREATION; MEMBERSHIP.] (a) The Electronic 
  3.15  Real Estate Recording Task Force is created to study and make 
  3.16  recommendations for the establishment of a system for the 
  3.17  electronic filing and recording of real estate documents. 
  3.18     (b) The task force consists of 15 members.  The secretary 
  3.19  of state shall serve as the chair of the task force.  The 
  3.20  state's chief information officer, as designated under section 
  3.21  16E.02, or the officer's designee, shall serve as the vice-chair 
  3.22  of the task force.  Members who are appointed under this section 
  3.23  shall serve for a term of three years beginning July 1, 2005.  
  3.24  The task force must include: 
  3.25     (1) three county government officials appointed by the 
  3.26  Association of County Officers, including one county recorder, 
  3.27  one county auditor, and one county treasurer; 
  3.28     (2) two county board members appointed by the Association 
  3.29  of Minnesota Counties, including one board member from within 
  3.30  the seven-county metropolitan area and one board member from 
  3.31  outside the seven-county metropolitan area; 
  3.32     (3) seven members from the private sector appointed by the 
  3.33  chair, including representatives of: 
  3.34     (i) real estate attorneys, real estate agents, and public 
  3.35  and private land surveyors; 
  3.36     (ii) title companies, mortgage companies, and other real 
  4.1   estate lenders; and 
  4.2      (iii) technical and industry experts in electronic commerce 
  4.3   and electronic records management and preservation; and 
  4.4      (4) a representative selected by the Minnesota Historical 
  4.5   Society. 
  4.6      (c) The task force may refer items to subcommittees.  The 
  4.7   chair shall appoint the membership of a subcommittee.  An 
  4.8   individual may be appointed to serve on a subcommittee without 
  4.9   serving on the task force. 
  4.10     Subd. 2.  [STUDY AND RECOMMENDATIONS.] (a) The task force 
  4.11  shall complete the work of the task force created by Laws 2000, 
  4.12  chapter 391, to study and make recommendations regarding 
  4.13  implementation of a system for electronic filing and recording 
  4.14  of real estate documents and shall consider: 
  4.15     (1) technology and computer needs; 
  4.16     (2) legal issues such as authenticity, security, timing and 
  4.17  priority of recordings, and the relationship between electronic 
  4.18  and paper recorder systems; 
  4.19     (3) cost-effectiveness of electronic recording systems; 
  4.20     (4) a timetable and plan for implementing an electronic 
  4.21  recording system, considering types of documents and entities 
  4.22  using the system and volume of recordings; 
  4.23     (5) permissive versus mandatory systems; and 
  4.24     (6) other relevant issues identified by the task force. 
  4.25     (b) The task force may commence establishing standards for 
  4.26  the electronic recording of the remaining residential real 
  4.27  estate deed and mortgage documents and establish pilot projects 
  4.28  to complete the testing and functions of the task force 
  4.29  established in Laws 2000, chapter 391. 
  4.30     (c) The task force shall submit a report to the legislature 
  4.31  by January 15 of each year during its existence reporting on the 
  4.32  progress toward the goals provided in this subdivision. 
  4.33     Subd. 3.  [DONATIONS.] The task force may accept donations 
  4.34  of money or resources, including loaned employees or other 
  4.35  services.  The donations must be under the sole control of the 
  4.36  task force. 
  5.1      Subd. 4.  [LEGISLATIVE COORDINATING COMMISSION; 
  5.2   DUTIES.] The task force may contract with the Legislative 
  5.3   Coordinating Commission for the provision of administrative 
  5.4   services to the task force, the preparation of requests for 
  5.5   proposal, or the disbursement of funds for the payment of 
  5.6   vendors, salaries, and other expenses of the task force. 
  5.7      Subd. 5.  [EXPIRATION.] The task force expires June 30, 
  5.8   2008. 
  5.9      <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2005. 
  5.10     Sec. 3.  Minnesota Statutes 2004, section 507.24, 
  5.11  subdivision 2, is amended to read: 
  5.12     Subd. 2.  [ORIGINAL SIGNATURES REQUIRED.] (a) Unless 
  5.13  otherwise provided by law, an instrument affecting real estate 
  5.14  that is to be recorded as provided in this section or other 
  5.15  applicable law must contain the original signatures of the 
  5.16  parties who execute it and of the notary public or other officer 
  5.17  taking an acknowledgment.  However, a financing statement that 
  5.18  is recorded as a filing pursuant to section 336.9-502(b) need 
  5.19  not contain:  (1) the signatures of the debtor or the secured 
  5.20  party; or (2) an acknowledgment.  
  5.21     (b) Any electronic instruments, including signatures and 
  5.22  seals, affecting real estate may only be recorded as part of a 
  5.23  pilot project for the electronic filing of real estate documents 
  5.24  implemented by the task force created in Laws 2000, chapter 
  5.25  391., or by the Electronic Real Estate Recording Task Force 
  5.26  created under section 507.094.  A county that participated in 
  5.27  the pilot project for the electronic filing of real estate 
  5.28  documents under the task force created in Laws 2000, chapter 
  5.29  391, may continue to record or file documents electronically, if:
  5.30     (1) the county complies with standards adopted by the task 
  5.31  force; and 
  5.32     (2) the county uses software that was validated by the task 
  5.33  force. 
  5.34  A county that did not participate in the pilot project may 
  5.35  record or file a real estate document electronically, if: 
  5.36     (i) the document to be recorded or filed is of a type 
  6.1   included in the pilot project for the electronic filing of real 
  6.2   estate documents under the task force created in Laws 2000, 
  6.3   chapter 391; 
  6.4      (ii) the county complies with the standards adopted by the 
  6.5   task force; 
  6.6      (iii) the county uses software that was validated by the 
  6.7   task force; and 
  6.8      (iv) the task force created under section 507.094 approves 
  6.9   a written request from the county board and county recorder of 
  6.10  the county to implement electronic filing under this section.  
  6.11     (c) Notices filed pursuant to section 168A.141, 
  6.12  subdivisions 1 and 3, need not contain an acknowledgment. 
  6.13     <b>[EFFECTIVE DATE.]</b> This section is effective the day 
  6.14  following final enactment. 
  6.15     Sec. 4.  [APPROPRIATION; REAL ESTATE FILING SURCHARGE 
  6.16  FUNDS.] 
  6.17     (a) All funds collected for the task force created under 
  6.18  Laws 2000, chapter 391, from the surcharge collected under 
  6.19  Minnesota Statutes 2002, sections 357.18, subdivision 3; 508.82, 
  6.20  subdivision 1; and 508A.82, subdivision 1; appropriated to the 
  6.21  Legislative Coordinating Commission for that purpose; and 
  6.22  remaining unspent as of December 1, 2004, are available to the 
  6.23  Legislative Coordinating Commission for the use of the task 
  6.24  force established by Minnesota Statutes, section 507.094, for 
  6.25  the purposes of that section.  This appropriation is available 
  6.26  until June 30, 2008. 
  6.27     (b) Of the amount appropriated in paragraph (a), $25,000 in 
  6.28  each fiscal year through fiscal year 2008 is payment to the 
  6.29  Legislative Coordinating Commission for the services provided to 
  6.30  the task force under Minnesota Statutes, section 507.094, 
  6.31  subdivision 4. 
  6.32     <b>[EFFECTIVE DATE.]</b> This section is effective July 1, 2005.