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Key: (1) language to be deleted (2) new language


                         Laws of Minnesota 1989 

                        CHAPTER 212-H.F.No. 1432 
           An act relating to transportation; requiring 
          nonrailroad lessors to comply with certain procedures 
          before sale of property interests; amending Minnesota 
          Statutes 1988, sections 222.631, by adding a 
          subdivision; 222.632; and 222.633.  
    Section 1.  Minnesota Statutes 1988, section 222.631, is 
amended by adding a subdivision to read: 
    Subd. 6.  [NONRAILROAD LESSOR.] "Nonrailroad lessor" means 
one who has granted to a lessee an interest in property within a 
right-of-way and who is neither (1) an operator of a railroad on 
the right-of-way, nor (2) an owner of a controlling interest in 
or under common control with a railroad that operates on the 
    Sec. 2.  Minnesota Statutes 1988, section 222.632, is 
amended to read: 
    222.632 [RIGHT OF FIRST REFUSAL.] 
    A railroad interest that is in bankruptcy proceedings may 
not sell or offer for sale an interest in real property that is 
within the right-of-way, and a railroad interest that is 
abandoning a railroad line may not sell or offer for sale an 
interest in real property within the right-of-way to be 
abandoned, and a nonrailroad lessor may not sell or offer for 
sale an interest in real property within the right-of-way with 
respect to which it is a nonrailroad lessor, unless it first 
extends a written offer to sell that interest at a fair market 
value price to each person who is a leaseholder with respect to 
the property.  Leaseholders must respond to the offer within 60 
days of receipt of the notice and the railroad interest must 
negotiate in good faith with an interested leaseholder for a 
period of 90 days following the leaseholder's response.  After 
the 90-day negotiation period, either party may file a notice of 
dispute with the board under section 222.633.  The property may 
not be sold to a party other than the leaseholder during the 
response and negotiation periods or while a dispute is pending 
before the board.  This section does not apply to a sale of an 
entire operating railroad line by one operating railroad to 
another for the purpose of operating a railroad. 
    Sec. 3.  Minnesota Statutes 1988, section 222.633, is 
amended to read: 
    (a) A railroad interest or leaseholder may apply to the 
transportation regulation board to resolve a dispute concerning 
fair market value or other terms arising from negotiations under 
section 222.632.  The board must adopt guidelines without regard 
to chapter 14 to implement section 222.632 and this section.  
The guidelines must define the terms 
"leaseholders," "nonrailroad lessor," and "railroad interest," 
establish a procedure to resolve disputes, and provide for the 
use of independent appraisers.  Final rules must be adopted no 
later than 360 days from March 22, 1986. 
    (b) The board's decision is final for purposes of judicial 
review and may be reviewed in the district court for the 
jurisdiction where the property is located.  The scope of 
judicial review is limited to a determination whether 
substantial evidence exists to support the board's decision. 
    Sec. 4.  [EFFECTIVE DATE.] 
    Sections 1 to 3 are effective the day following final 
    Presented to the governor May 19, 1989 
    Signed by the governor May 23, 1989, 5:50 p.m.