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SF 2750

4th Engrossment - 84th Legislature (2005 - 2006) Posted on 12/15/2009 12:00am

KEY: stricken = removed, old language.
underscored = added, new language.
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A bill for an act
relating to eminent domain; defining public use or purpose; prohibiting the use
of eminent domain for economic development; requiring clear and convincing
evidence for certain takings; providing for attorney fees and other additional
elements of compensation; making other changes in the exercise of eminent
domain; amending Minnesota Statutes 2004, sections 117.025; 117.036; 117.055;
117.075, subdivision 1, by adding a subdivision; 117.085; 117.51; 117.52,
subdivision 1, by adding a subdivision; 163.12, subdivisions 1a, 1b; proposing
coding for new law in Minnesota Statutes, chapter 117.

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

Section 1.

new text begin [117.012] PREEMPTION; NO IMPLIED AUTHORITY.
new text end

new text begin Subdivision 1. new text end

new text begin Preemption. new text end

new text begin Notwithstanding any other provision of law, including
any charter provision, ordinance, statute, or special law, all condemning authorities,
including home rule charter cities and all other political subdivisions of the state, must
exercise the power of eminent domain in accordance with the provisions of this chapter,
including all procedures, definitions, remedies, and limitations. Additional procedures,
remedies, or limitations that do not deny or diminish the substantive and procedural rights
and protections of owners under this chapter may be provided by other law, ordinance,
or charter.
new text end

new text begin Subd. 2. new text end

new text begin No implied authority. new text end

new text begin The power of eminent domain shall not be implied.
In order to exercise the power of eminent domain, the condemning authority must have an
express grant of eminent domain authority.
new text end

new text begin Subd. 3. new text end

new text begin Requirement of public use or public purpose. new text end

new text begin Eminent domain may
only be used for a public use or public purpose.
new text end

Sec. 2.

Minnesota Statutes 2004, section 117.025, is amended to read:


117.025 DEFINITIONS.

Subdivision 1.

Words, terms, and phrases.

deleted text begin Unless the language or context clearly
indicates that a different meaning is intended,
deleted text end new text begin For the purposes of this chapter and any
other general or special law authorizing the exercise of the power of eminent domain,
new text end the
words, terms, and phrases defined in this section have the meanings given them.

Subd. 2.

Taking.

new text begin "new text end Takingnew text begin "new text end and all words and phrases of like import include every
interference, under the right of eminent domain, with the possession, enjoyment, or value
of private property.

Subd. 3.

Owner.

"Owner" includes all persons deleted text begin interested in suchdeleted text end new text begin with any interest
in the
new text end property new text begin subject to a taking, whether new text end as proprietors, tenants, life estate holders,
encumbrancers, new text begin beneficial interest holders, new text end or otherwise.

new text begin Subd. 4. new text end

new text begin Condemning authority. new text end

new text begin "Condemning authority" means a person or
entity with the power of eminent domain.
new text end

new text begin Subd. 5. new text end

new text begin Abandoned property. new text end

new text begin "Abandoned property" means property that: (1) has
been substantially unoccupied or unused for any commercial or residential purpose for at
least one year by a person with a legal or equitable right to occupy the property; (2) has not
been maintained; and (3) for which taxes have not been paid for at least two previous years.
new text end

new text begin Subd. 6. new text end

new text begin Blighted area. new text end

new text begin "Blighted area" means an area:
new text end

new text begin (1) that is zoned and used for urban use; and
new text end

new text begin (2) where more than 50 percent of the buildings are structurally substandard.
new text end

new text begin Subd. 7. new text end

new text begin Structurally substandard. new text end

new text begin "Structurally substandard" means:
new text end

new text begin (a) a building:
new text end

new text begin (1) that was inspected by the appropriate local government and cited for one or more
enforceable housing, maintenance, or building code violations;
new text end

new text begin (2) in which the cited building code violations involve one or more of the following:
new text end

new text begin (i) a roof and roof framing element;
new text end

new text begin (ii) support walls, beams, and headers;
new text end

new text begin (iii) foundation, footings, and subgrade conditions;
new text end

new text begin (iv) light and ventilation;
new text end

new text begin (v) fire protection, including egress;
new text end

new text begin (vi) internal utilities, including electricity, gas, and water;
new text end

new text begin (vii) flooring and flooring elements; and
new text end

new text begin (viii) walls, insulation, and exterior envelope;
new text end

new text begin (3) in which the cited housing, maintenance, or building code violations have not
been remedied after two notices to cure the noncompliance; and
new text end

new text begin (4) has uncured housing, maintenance, and building code violations, satisfaction
of which would cost more than 50 percent of the assessor's taxable market value for the
building, excluding land value, as determined under section 273.11 for property taxes
payable in the year in which the condemnation is commenced; or
new text end

new text begin (b) a building that, as of the date the condemnation is commenced, is unsafe or
lacking in basic equipment.
new text end

new text begin A local government is authorized to gain access to inspect any building in a proposed
development or redevelopment area upon showing of probable cause that the building is
structurally substandard. Items of evidence that support a conclusion of probable cause
may include recent fire or police inspections, on-site property tax appraisals, housing
inspections, exterior evidence of deterioration, or other similar reliable evidence.
new text end

new text begin Subd. 8. new text end

new text begin Environmentally contaminated area. new text end

new text begin "Environmentally contaminated
area" means an area:
new text end

new text begin (1) in which more than 50 percent of the parcels contain any substance defined,
regulated, or listed as a hazardous substance, hazardous material, hazardous waste, toxic
waste, pollutant, contaminant, or toxic substance, or identified as hazardous to human
health or the environment under state or federal law or regulation; and
new text end

new text begin (2) for which the estimated costs of investigation, monitoring and testing, and
remedial action or removal, as defined in section 115B.02, subdivisions 16 and 17,
respectively, including any state costs of remedial actions, exceed 100 percent of the
assessor's estimated market value for the contaminated parcel, as determined under section
273.11, for property taxes payable in the year in which the condemnation commenced, or
for which a court of competent jurisdiction has issued an order under law or regulations
adopted by Minnesota or the United States, that clean up or remediation of a contaminated
site occur and the property owner has failed to comply with the court's order within
a reasonable time.
new text end

new text begin Subd. 9. new text end

new text begin Public nuisance. new text end

new text begin "Public nuisance" means a public nuisance under
section 609.74.
new text end

new text begin Subd. 10. new text end

new text begin Public service corporation. new text end

new text begin "Public service corporation" means a
utility, as defined by section 116C.52, subdivision 10; gas, electric, telephone, or cable
communications company; cooperative association; natural gas pipeline company; crude
oil, or petroleum products pipeline company; municipal utility; municipality when
operating its municipally owned utilities; or municipal power agency. Public service
corporation also means a municipality or public corporation when operating an airport
under chapter 360 or 473, a common carrier, a watershed district, or a drainage authority.
Public service corporation also means an entity operating a regional distribution center
within an international economic development zone designated under section 469.322.
new text end

new text begin Subd. 11. new text end

new text begin Public use; public purpose. new text end

new text begin (a) "Public use" or "public purpose" means,
exclusively:
new text end

new text begin (1) the possession, occupation, ownership, and enjoyment of the land by the general
public, or by public agencies;
new text end

new text begin (2) the creation or functioning of a public service corporation;
new text end

new text begin (3) mitigation of a blighted area, remediation of an environmentally contaminated
area, reduction of abandoned property, or removal of a public nuisance; or
new text end

new text begin (4) the provision of physical or financial assistance to a governmental unit or
nonprofit organization that provides emergency shelter and services for homeless persons
in a first class city.
new text end

new text begin (b) The public benefits of economic development, including an increase in tax base,
tax revenues, employment, or general economic health, do not by themselves constitute
a public use or public purpose.
new text end

Sec. 3.

new text begin [117.027] CONDEMNATION FOR BLIGHT MITIGATION AND
CONTAMINATION REMEDIATION.
new text end

new text begin Subdivision 1. new text end

new text begin Buildings that are not structurally substandard in areas of blight
mitigation; feasible alternatives.
new text end

new text begin In taking property to mitigate blight, a condemning
authority must not take buildings that are not structurally substandard unless there is no
feasible alternative to the taking of the parcels on which the buildings are located in
order to remediate the blight and all possible steps are taken to minimize the taking of
buildings that are not structurally substandard.
new text end

new text begin Subd. 2. new text end

new text begin Uncontaminated property in environmental contamination
remediation areas; feasible alternatives.
new text end

new text begin In taking property to remediate environmental
contamination, a condemning authority must not take uncontaminated parcels in the area
unless there is no feasible alternative to the taking of the uncontaminated parcels in order
to complete remediation of the contaminated parcels and all possible steps are taken to
minimize the taking of the uncontaminated parcels.
new text end

new text begin Subd. 3. new text end

new text begin Contribution to condition by developer disallowed. new text end

new text begin If a developer
involved in the redevelopment of the project area contributed to the blight or environmental
contamination within the project area, the condition contributed to by the developer must
not be used in the determination of blight or environmental contamination.
new text end

Sec. 4.

Minnesota Statutes 2004, section 117.036, is amended to read:


117.036 APPRAISAL AND NEGOTIATION REQUIREMENTS
deleted text begin APPLICABLE TO ACQUISITION OF PROPERTY FOR TRANSPORTATION
PURPOSES
deleted text end .

Subdivision 1.

Application.

This section applies to the acquisition of property
deleted text begin for public highways, streets, roads, alleys, airports, mass transit facilities, or for other
transportation facilities or purposes
deleted text end new text begin under this chapternew text end .

new text begin Subd. 1a. new text end

new text begin Definition of owner. new text end

new text begin For the purposes of this section, "owner" means
fee owner, contract purchaser, or business lessee who is entitled to condemnation
compensation under a lease.
new text end

Subd. 2.

Appraisal.

(a) Before commencing an eminent domain proceeding under
this chapter, the acquiring authority must obtain at least one appraisal for the property
proposed to be acquired. In making the appraisal, the appraiser must confer with one or
more of the owners of the property, if reasonably possible. deleted text begin At least 20deleted text end new text begin The acquiring
authority must provide the owner with a copy of each appraisal the acquiring authority has
obtained for the property at the time an offer is made, but no later than 60
new text end days before
presenting a petition under section 117.055, deleted text begin the acquiring authority must provide the
owner with a copy of the appraisal
deleted text end and inform the deleted text begin owner of the owner'sdeleted text end new text begin owner of thenew text end right
to obtain an appraisal under this section.new text begin Upon request, the acquiring authority must
make available to the owner all appraisals of the property. If the acquiring authority is
considering both a full and partial taking of the property, the acquiring authority shall
obtain and provide the owner with appraisals for both types of takings.
new text end

(b) The owner may obtain an appraisal by a qualified appraiser of the property
proposed to be acquired. The owner is entitled to reimbursement for the reasonable costs
of the appraisal from the acquiring authority up to a maximum of $1,500 deleted text begin within 30 days
after the
deleted text end new text begin for single family and two-family residential property, agricultural property, and
minimum damage acquisitions and $5,000 for other types of property, provided that the
new text end owner submits to the acquiring authority the information necessary for reimbursement,
deleted text begin provided that the owner does sodeleted text end new text begin including a copy of the owner's appraisal,new text end within deleted text begin 60deleted text end new text begin 90new text end
days after deleted text begin the owner receivesdeleted text end new text begin receivingnew text end the appraisal from the authority under paragraph
(a)new text begin and at least five days before a condemnation commissioners' hearing. For purposes
of this paragraph, a "minimum damage acquisition" means an interest in property that a
qualified person with appraisal knowledge indicates can be acquired for a cost of $10,000
or less. For purposes of this paragraph, "agricultural property" has the meaning given
in section 583.22, subdivision 2.
new text end

new text begin (c) The acquiring authority must pay the reimbursement to the owner within 30
days after receiving a copy of the appraisal and the reimbursement information. Upon
agreement between the acquiring authority and the owner, the acquiring authority may pay
the reimbursement directly to the appraiser
new text end .

Subd. 3.

Negotiation.

In addition to the appraisal requirements under subdivision 2,
before commencing an eminent domain proceeding, the acquiring authority must make a
good faith attempt to negotiate personally with the owner of the property in order to
acquire the property by direct purchase instead of the use of eminent domain proceedings.
In making this negotiation, the acquiring authority must consider the appraisals in its
possessionnew text begin , including any appraisal obtained and furnished by the owner if available,new text end
and other information that may be relevant to a determination of damages under this
chapter. new text begin If the acquiring authority is considering both a full and partial taking of the
property, the acquiring authority must make a good-faith attempt to negotiate with respect
to both types of takings.
new text end

new text begin Subd. 4. new text end

new text begin Use of appraisal at commissioners' hearing. new text end

new text begin An appraisal must not be
used or considered in a condemnation commissioners' hearing, nor may the appraiser who
prepared the appraisal testify, unless a copy of the appraiser's written report is provided to
the opposing party at least five days before the hearing.
new text end

Sec. 5.

new text begin [117.0412] LOCAL GOVERNMENT PUBLIC HEARING
REQUIREMENTS.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin For the purposes of this section:
new text end

new text begin (1) "local government" means the elected governing body of a statutory or home
rule charter city, county, or township; and
new text end

new text begin (2) "local government agency" means a subdivision, agency, authority, or other
entity created by or whose members are appointed by the local government, including a
port authority, economic development authority, housing and redevelopment authority, or
other similar entity established under law.
new text end

new text begin Subd. 2. new text end

new text begin Public hearing; vote by local government governing body. new text end

new text begin (a) Before a
local government or local government agency commences an eminent domain proceeding
under section 117.055, a public hearing must be held as provided in this section. The
local government must notify each owner of property that may be acquired in writing
by certified mail of the public hearing on the proposed taking, post the public hearing
information on the local government's Web site, if any, and publish notice of the public
hearing in a newspaper of general circulation in the local government's jurisdiction.
Notice must be provided at least 30 days but not more than 60 days before the hearing.
new text end

new text begin (b) Any interested person must be allowed reasonable time to present relevant
testimony at the public hearing. The proceedings of the hearing must be recorded and
available to the public for review and comment at reasonable times and a reasonable place.
At the next regular meeting of the local government that is at least 30 days after the public
hearing, the local government must vote on the question of whether to authorize the local
government or local government agency to use eminent domain to acquire the property.
new text end

new text begin Subd. 3. new text end

new text begin Resolution. new text end

new text begin If the taking is for the mitigation of a blighted area,
remediation of an environmentally contaminated area, reducing abandoned property, or
removing a public nuisance, then the resolution of a local government or local government
agency authorizing the use of eminent domain must:
new text end

new text begin (1) identify and describe the public costs and benefits that are known or expected
to result from the program or project for which the property interest is proposed to be
acquired; and
new text end

new text begin (2) address how the acquisition of the property interest serves one or more identified
public uses or public purposes and why the acquisition of the property is needed to
accomplish those public uses or public purposes.
new text end

Sec. 6.

Minnesota Statutes 2004, section 117.055, is amended to read:


117.055 PETITION AND NOTICE.

new text begin Subdivision 1. new text end

new text begin Petition. new text end

In all cases a petition, describing the desired land, stating by
whom and for what purposes it is proposed to be taken, and giving the names of all persons
appearing of record or known to the petitioner to be the owners thereof shall be presented
to the district court of the county in which the land is situated praying for the appointment
of commissioners to appraise the damages which may be occasioned by such taking.

new text begin Subd. 2. new text end

new text begin Notice. new text end

new text begin (a) new text end Notice of the objects of the petition and of the time and place of
presenting the same shall be served at least 20 days before such time of presentation upon
all persons named in the petition as owners as defined in section 117.025, subdivision 3,
and upon all occupants of such land in the same manner as a summons in a civil action.

new text begin (b) The notice must state that:
new text end

new text begin (1) a party wishing to challenge the public use or public purpose, necessity, or
authority for a taking must appear at the court hearing and state the objection or must
appeal within 60 days of a court order; and
new text end

new text begin (2) a court order approving the public use or public purpose, necessity, and authority
for the taking is final unless an appeal is brought within 60 days after service of the
order on the party.
new text end

new text begin (c) new text end If any such owner be not a resident of the state, or the owner's place of residence
be unknown to the petitioner, upon the filing of an affidavit of the petitioner or the
petitioner's agent or attorney, stating that the petitioner believes that such owner is not
a resident of the state, and that the petitioner has mailed a copy of the notice to the
owner at the owner's place of residence, or that after diligent inquiry the owner's place
of residence cannot be ascertained by the affiant, then service may be made upon such
owner by three weeks' published notice. If the state be an owner, the notice shall be
served upon the attorney general. Any owner not served as herein provided shall not be
bound by such proceeding except upon voluntarily appearing therein. Any owner shall
be furnished a right-of-way map or plat of all that part of land to be taken upon written
demand, provided that the petitioner shall have ten days from the receipt of the demand
within which to furnish the same. Any plans or profiles which the petitioner has shall be
made available to the owner for inspection.

Sec. 7.

Minnesota Statutes 2004, section 117.075, subdivision 1, is amended to read:


Subdivision 1.

Hearing on takingnew text begin ; evidentiary standardnew text end .

new text begin (a) new text end Upon proof being
filed of the service of such notice, the court, at the time and place therein fixed or to which
the hearing may be adjourned, shall hear all competent evidence offered for or against the
granting of the petition, regulating the order of proof as it may deem best.

new text begin (b) If the taking is for the mitigation of a blighted area, remediation of an
environmentally contaminated area, reducing abandoned property, or removing a
public nuisance, then, notwithstanding any other provision of general or special law, a
condemning authority must show the district court by preponderance of the evidence that
the taking is necessary and for the designated public use.
new text end

new text begin (c) A court order approving the public use or public purpose, necessity, and authority
for the taking is final unless an appeal is brought within 60 days after service of the
order on the party.
new text end

Sec. 8.

Minnesota Statutes 2004, section 117.075, is amended by adding a subdivision
to read:


new text begin Subd. 1b. new text end

new text begin Attorney fees. new text end

new text begin If the court determines that a taking is not for a public use
or public purpose or is unlawful, the court shall award the owner reasonable attorney fees
and other related expenses, fees, and costs.
new text end

Sec. 9.

Minnesota Statutes 2004, section 117.085, is amended to read:


117.085 COMMISSIONERS, POWERS, DUTIES.

The commissioners, having been duly sworn and qualified according to law, shall
meet as directed by the order of appointment and hear the allegations and proofs of all
persons interested touching the matters to them committed. They may adjourn from time
to time and from place to place within the county, giving oral notice to those present of
the time and place of their next meeting. All testimony taken by them shall be given
publicly, under oath, and in their presence. They shall view the premises, and any of
them may subpoena witnesses, which shall be served as subpoenas in civil actions are
served, and at the cost of the parties applying therefor. If deemed necessary, they may
require the petitioner or owner to furnish for their use maps, plats, and other information
which the petitioner or owner may have showing the nature, character, and extent of the
proposed undertaking and the situation of lands desired therefor. In proper cases they may
reserve to the owner a right-of-way or other privilege in or over the land taken, or attach
reasonable conditions to such taking in addition to the damages given or they may make
an alternative award, conditioned upon the granting or withholding of the right specified.
Without unreasonable delay they shall make a separate assessment and award of the
damages which in their judgment will result to each of the owners of the land by reason
of such taking and report the same to the court. The commissioners shall not reduce the
amount of the damages awarded because the land being taken is, at the time of the taking,
valued under section 273.111, designated as an agricultural preserve under chapter 473H.
The commissioners, in all such proceedings, may in their discretion allow and show
separately in addition to the award of damages, reasonable appraisal fees not to exceed a
total of deleted text begin $500deleted text end new text begin $1,500 for single family and two-family residential property, agricultural
property, and minimum damage acquisitions and $5,000 for other types of property
new text end . Upon
request of an owner the commissioners shall show in their report the amount of the award
of damages which is to reimburse the owner and tenant or lessee for the value of the land
taken, and the amount of the award of damages, if any, which is to reimburse the owner
and tenant or lessee for damages to the remainder involved, whether or not described in
the petition. The amounts awarded to each person shall also be shown separately. The
commissioners shall, if requested by any party, make an express finding of the estimated
cost of removal and remedial actions that will be necessary on the taken property because
of existing environmental contamination.

Sec. 10.

new text begin [117.184] COMPENSATION FOR REMOVAL OF LEGAL
NONCONFORMING USE.
new text end

new text begin Notwithstanding any law to the contrary, an ordinance or regulation of a political
subdivision of the state or local zoning authority that requires the removal of a legal
nonconforming use as a condition or prerequisite for the issuance of a permit, license, or
other approval for any use, structure, development, or activity constitutes a taking and
is prohibited without the payment of just compensation. This section does not apply if
the permit, license, or other approval is requested for the construction of a building or
structure that cannot be built without physically moving the nonconforming use.
new text end

Sec. 11.

new text begin [117.186] COMPENSATION FOR LOSS OF GOING CONCERN.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin For purposes of this section:
new text end

new text begin (1) "going concern" means the benefits that accrue to a business or trade as a result
of its location, reputation for dependability, skill or quality, customer base, good will, or
any other circumstances resulting in the probable retention of old or acquisition of new
patronage; and
new text end

new text begin (2) "owner" has the meaning given in section 117.025 and includes a lessee who
operates a business on real property that is the subject of an eminent domain proceeding.
new text end

new text begin Subd. 2. new text end

new text begin Compensation. new text end

new text begin (a) In all eminent domain proceedings, the owner of
a business or trade must be compensated for the loss of a going concern if the owner
establishes that:
new text end

new text begin (1) the business or trade has been destroyed as a result of the taking;
new text end

new text begin (2) the loss cannot be reasonably prevented by relocating the business or trade in the
same or a similar and reasonably suitable location as the property that was taken, or by
taking steps and adopting procedures that a reasonably prudent person of a similar age
and under similar conditions as the owner would take and adopt in preserving the going
concern of the business or trade; and
new text end

new text begin (3) compensation for the loss of going concern will not be duplicated in the
compensation otherwise awarded to the owner of the business or trade.
new text end

new text begin (b) If an eminent domain proceeding involves the condemnation of agricultural
property, as defined in section 583.22, subdivision 2, the owner of the agricultural property
must be compensated for the loss of the productive value of the agricultural property for a
period of at least five years after commencement of the eminent domain proceeding. The
productive value is calculated based on average productive capacity of the property during
the five years preceding commencement of the eminent domain proceeding.
new text end

new text begin Subd. 3. new text end

new text begin Procedure. new text end

new text begin In all cases where an owner will seek compensation for loss
of a going concern, the damages, if any, shall in the first instance be determined and
reported by the commissioners under section 117.105 as part of the compensation due to
the owner. The owner shall notify the condemning authority of the owner's intent to claim
compensation for loss of going concern within 60 days of the first hearing before the court,
as provided in section 117.075. The commissioner's decision regarding any award for loss
of going concern may be appealed by any party, in accordance with section 117.145.
new text end

new text begin Subd. 4. new text end

new text begin Driveway access. new text end

new text begin A business owner is entitled to reasonable compensation,
not to exceed the three previous years' revenues minus the cost of goods sold, if the owner
establishes that the actions of a government entity permanently eliminated 51 percent or
greater of the driveway access into and out of a business and as a result of the loss of
driveway access, revenue at the business was reduced by 51 percent or greater. A claim
for compensation under this section must be made no later than one year after completion
of the project which eliminated the driveway access.
new text end

Sec. 12.

new text begin [117.187] MINIMUM COMPENSATION.
new text end

new text begin When an owner must relocate, the amount of damages payable, at a minimum, must
be sufficient for an owner to purchase a comparable property in the community and not
less than the condemning authority's payment or deposit under section 117.042, to the
extent that the damages will not be duplicated in the compensation otherwise awarded to
the owner of the property.
new text end

Sec. 13.

new text begin [117.188] LIMITATIONS.
new text end

new text begin The condemning authority must not require the owner to accept as part of the
compensation due any substitute or replacement property. The condemning authority
must not require the owner to accept the return of property acquired or any portion of the
property.
new text end

Sec. 14.

new text begin [117.189] PUBLIC SERVICE CORPORATION EXCEPTIONS.
new text end

new text begin Sections 117.012, subdivision 2; 117.036; 117.055, subdivision 2, paragraph (b);
117.075, subdivision 1b; 117.186; 117.187; 117.188; 117.196; and 117.52, subdivision 1a,
do not apply to public service corporations. For purposes of an award of appraisal fees
under section 117.085, the fees awarded may not exceed $500 for all types of property.
new text end

Sec. 15.

new text begin [117.196] ATTORNEY FEES.
new text end

new text begin Subdivision 1. new text end

new text begin Judgment or award in excess of last written offer. new text end

new text begin If the final
judgment or award of damages is at least 20 percent greater than the last written offer of
compensation made by the condemning authority before the filing of the petition, the court
may award the owner reasonable attorney fees and costs in addition to other compensation
and fees authorized by this chapter.
new text end

new text begin Subd. 2. new text end

new text begin Increase in market value. new text end

new text begin If three months or more pass from the date of
the last written offer of compensation and the filing of the petition, for the purposes of
determining whether the final judgment or award for damages is more than 20 percent
greater than the last written offer, the value of the offer must be adjusted on a pro rata basis
for the annual rate of increase in the estimated market value of existing property in the
subject property's use class within the same city or township. The annual rate of increase
shall be derived by comparing the most recent abstract filed with the commissioner of
revenue under section 270C.89, subdivision 1, with the abstract of the prior year.
new text end

new text begin Subd. 3. new text end

new text begin Exception. new text end

new text begin No attorney fees and costs may be awarded under this section if
only a portion of a property located not more than 50 feet from the border of the property
is being acquired and the final judgment or award of damages does not exceed $25,000.
new text end

Sec. 16.

new text begin [117.226] RIGHT OF FIRST REFUSAL.
new text end

new text begin (a) Notwithstanding section 161.23, if the governing body of the condemning
authority determines that publicly owned property acquired under this chapter has not
been used and is no longer needed for a public use, the authority must offer to sell the
property to the owner from whom it was acquired, if the former owner can be located,
at the original price determined by the condemnation process or the current fair market
value of the property, whichever is lower.
new text end

new text begin (b) If the former owner cannot be located within ten days, a written notice and offer
to sell the property must be sent by certified mail to the last known address of the former
owner and must be published for at least 30 days on the condemning authority's Web site,
if any, and in a newspaper of general circulation in the jurisdiction where the property is
located. If the former owner declines to repurchase the property, the condemning authority
shall prepare a certificate attesting to the same and record the certificate in the office of the
county recorder or county registrar of titles, as appropriate, to evidence the termination of
the right of first refusal.
new text end

Sec. 17.

Minnesota Statutes 2004, section 117.51, is amended to read:


117.51 COOPERATION WITH FEDERAL AUTHORITIES.

In all acquisitions undertaken by any acquiring authority and in all voluntary
rehabilitation carried out by a person pursuant to acquisition or as a consequence thereof,
the acquiring authority shall cooperate to the fullest extent with federal departments and
agencies, and it shall take all necessary action in order to insure, to the maximum extent
possible, federal financial participation in any and all phases of acquisition, including the
provision of relocation assistance, services, payments and benefits to displaced persons.
deleted text begin An acquiring authority may consider reimbursing up to $50,000 in reestablishment
expenses of a displaced business.
deleted text end

Sec. 18.

Minnesota Statutes 2004, section 117.52, subdivision 1, is amended to read:


Subdivision 1.

Lack of federal funding.

In all acquisitions undertaken by any
acquiring authority and in all voluntary rehabilitation carried out by a person pursuant
to acquisition or as a consequence thereof, in which, due to the lack of federal financial
participation, relocation assistance, services, payments and benefits under the Uniform
Relocation Assistance and Real Property Acquisition Policies Act of 1970, United States
Code, title 42, sections 4601 to 4655, as amended by the Surface Transportation and
Uniform Relocation Assistance Act of 1987, Statutes at Large, volume 101, pages 246
to 256 (1987), are not available, the acquiring authority, as a cost of acquisition, shall
provide all relocation assistance, services, payments and benefits required by the Uniform
Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended by
the Surface Transportation and Uniform Relocation Assistance Act of 1987, and those
regulations adopted pursuant thereto, and either (1) in effect as of deleted text begin July 1, 1988deleted text end new text begin January 1,
2006
new text end , or (2) becoming effective after deleted text begin July 1, 1988deleted text end new text begin January 1, 2006new text end , following a public
hearing and comment. Comments received by an acquiring authority within 30 days after
the public hearing must be reviewed and a written response provided to the individual or
organization who initiated the comment. The response and comments may be addressed in
another public hearing by the acquiring authority before approval.

Sec. 19.

Minnesota Statutes 2004, section 117.52, is amended by adding a subdivision
to read:


new text begin Subd. 1a. new text end

new text begin Reestablishment costs limit. new text end

new text begin For purposes of relocation benefits paid by
the acquiring authority in accordance with this section, the provisions of Code of Federal
Regulations, title 49, section 24.304, with respect to reimbursement of reestablishment
expenses for nonresidential moves are applicable, except that the acquiring authority shall
reimburse the displaced business for expenses actually incurred up to a maximum of
$50,000.
new text end

Sec. 20.

Minnesota Statutes 2004, section 163.12, subdivision 1a, is amended to read:


Subd. 1a.

Petition, notice, and access to information.

(a) Upon passage of the
resolution specified in section 163.11, subdivision 2, a petition must be presented to the
district court of the county in which the land is located. The petition must describe each
tract of land through which the highway passes, state the purposes for which the land is
proposed to be taken, and list the names of all persons appearing of record or known to
the county to be the landowners.

(b) Notice of the objects of the petition and of the time and place of presenting the
notice must be served, together with a copy of the resolution, upon each occupant of
each tract of land through which the highway passes at least 20 days before the hearing
under subdivision 1b. If an owner is not a resident of the state, or the owner's place of
residence is unknown to the county, service may be made by three weeks' published
notice following the filing of an affidavit on behalf of the county by the county's agent or
attorney stating that the county:

(1) believes that the owner is not a resident of the state; and

(2) has either mailed a copy of the notice to the owner at the owner's last known
residence address or, after diligent inquiry, the owner's place of residence cannot be
ascertained by the county.

If the state is an owner, the notice must be served upon the attorney general. An owner
not served as provided in this subdivision is not bound by the proceeding, except if the
owner voluntarily appears in the proceeding.

(c) Within ten days of an owner's demand, the owner must be furnished a
right-of-way map or plat of all that part of the owner's land to be taken. Any applicable
plans or profiles that the county possesses must be made available to the owner for
inspection.

new text begin (d) The notice must state that:
new text end

new text begin (1) a party wishing to challenge the public use or public purpose, necessity, or
authority for the taking must appear at the court hearing and state the objection; and
new text end

new text begin (2) a court order approving the public use or public purpose, necessity, and authority
for the taking is final unless an appeal is brought within 60 days after service of the
order on the party.
new text end

Sec. 21.

Minnesota Statutes 2004, section 163.12, subdivision 1b, is amended to read:


Subd. 1b.

Finding of necessity.

When proof of service of the notice required in
subdivision 1a is filed with the court, the court shall hear all competent evidence offered
for or against granting the petition at the time and place fixed in the notice or otherwise set
by the court. On finding that the proposed taking is necessary and authorized by law the
court shall order the proceedings to commence pursuant to the remaining provisions of
this section.new text begin The court order finding the taking necessary and authorized by law is a final
order and must be appealed within 60 days from its service on the party.
new text end

Sec. 22. new text begin REVISOR'S INSTRUCTION.
new text end

new text begin The revisor shall change the phrase "right of eminent domain" where found in
Minnesota Statutes and Minnesota Rules to "power of eminent domain."
new text end

Sec. 23. new text begin EFFECTIVE DATE.
new text end

new text begin This act is effective the day following final enactment and applies to condemnation
proceedings for which service of notice of the petition under Minnesota Statutes, section
117.055, is made on or after that date, except the act does not apply to an action by a
condemning authority if the action satisfies one of the following conditions:
new text end

new text begin (1) if the municipality, as that term is used in Minnesota Statutes, section 469.174,
subdivision 6, by the day following final enactment, has approved a tax increment
financing plan under Minnesota Statutes, section 469.175, before April 1, 2006, and one
or more of the following conditions exists in connection with the tax increment financing
plan:
new text end

new text begin (i) the developer has acquired property by June 1, 2006, in reliance on the
condemning authority's contractual obligation to condemn property; or
new text end

new text begin (ii) the condemning authority has issued, sold, or entered a binding agreement to
issue or sell bonds or other financial instruments to finance the costs of the tax increment
financing plan or district by June 1, 2006; or
new text end

new text begin (2) creation of the tax increment financing district was authorized under a special
law that received local approval or became effective without local approval before April 1,
2006, and the condemning authority commences the action within the later of:
new text end

new text begin (i) five years after the municipality approved the tax increment financing plan; or
new text end

new text begin (ii) the time period permitted under the special law for making expenditures to
comply with Minnesota Statutes, section 469.1763, subdivision 3, but not to exceed a
ten-year period; or
new text end

new text begin (3) the condemning authority has commenced a condemnation action before June 1,
2006, to complete land assembly for a project, financed in whole or part with abatement
under Minnesota Statutes, sections 469.1813 through 469.1815, and the abatement
resolution was adopted by one of the participating political subdivisions before April
1, 2006.
new text end