2007 Minnesota Legislative Agenda

These proposals have the support of AARP, Alliance for Metropolitan Stability, Housing Preservation Project, Legal Services Advocacy Project, Metropolitan Interfaith Council on Affordable Housing (MICAH), Minnesota Association of Cooperatives, Minnesota Housing Partnership, and Northcountry Cooperative Development Fund, among others.

Guaranteed Relocation Compensation

  • Background: Manufactured (mobile) home parks are the largest source of unsubsidized affordable housing in Minnesota. They exceed the state’s combined Housing and Urban Development (HUD) subsidized units and Rural Development units. Residents are in a vulnerable housing situation, however, since they own their homes but not the land. The closure of a park can be financially devastating for residents and most often means the loss of their homes, since their homes cannot be moved due to age, moving costs (ranging from $6,000 to $13,000), shortage of available lots, or parks barring homes over 10 years old (71 percent). In the last six years, at least 17 parks have closed.
  • The Current Law: Under current Minnesota law, there is no guarantee of relocation compensation if a park closes. The law requires that cities hold a public closure hearing and decide whether or not to require that the park owner provide compensation; some cities have decided that park owners don’t have to provide any compensation. This process usually results in multiple public hearings to determine: (a) if such a requirement should be imposed; and (b) the amount and method of that compensation. As a result, cities feel pressure on their schedules and resources, find themselves inserted into specific business deals, and face legal challenges to their role in the park closure proceedings from park owners, developers, and residents. 19 cities have taken the precaution to adopt relocation compensation requirement ordinances. However, this leaves over 380 cities with no clear process and over 90% of residents with no protection.
  • Other States: There are nine states that have guaranteed relocation compensation and four others that require it under certain circumstances. Massachusetts, Arizona, Connecticut and Nevada have mandatory relocation compensation.
  • Proposed Changes: We are proposing that state law be amended to require that park owners pay relocation compensation including the cost of relocation of the home or, if the home cannot be relocated, the appraised market value of the home to ensure that residents across the state are protected from financial devastation when parks close.

Expanded Right of First Refusal

  • Background: Parks are a critical source of affordable housing. They offer very low housing costs (mean monthly rent statewide is $367) and the opportunity for low-income home ownership (87% are owner-occupied). Many families who live in parks, including single parents and seniors living on a fixed income, could literally not afford to live anywhere else, if their park closes, or if they are evicted. Unfortunately, residents are in a vulnerable housing situation, since they own their homes but not the land, and face a number of threats, including the park being sold or closed, needed improvements not being made, unfair or inconsistently applied park rules, capricious rent increases, and an inability to accumulate equity. Even guaranteeing relocation compensation is not a complete solution given low park vacancy rates.
  • The Current Law: Minnesota law gives residents a right of first refusal, but only in limited circumstances. A right of first refusal exists only when a park is sold for redevelopment. Additionally, residents or a nonprofit authorized by the residents only have 45 days to meet the same terms and conditions as the developer. There are no resident purchase rights when a park is sold to remain as a park or if a park is closed more than one year after a sale. There are no incentives for park owners to sell to residents and so owners have resisted compliance with the current law.
  • Other States: There are ten states that provide resident purchase rights, such as Massachusetts that has a right of first refusal, or New Hampshire, which requires that park owners negotiate in good faith any time a park is sold. The time frame for exercising purchase rights in other states ranges from 45 days to a full year. Additionally, some states have included incentives to prompt park owners to sell parks to residents or nonprofits. For example, both Vermont and Oregon have tax incentives for park owners who sell parks to the residents.
  • Proposed Changes: We propose several changes to the current right of first refusal law, including: expanding the right of first refusal to apply any time a park sells, not just if it is selling for closure within a year (a major loophole in the current law); expanding the time frame for meeting the purchase price from 45 days to 90 days; and providing incentives for park owners who sell to residents or a nonprofit.

    For more information or to become involved, call APAC at (651) 644-5525 or (866) 361-2722