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Minnesota Property Rights

Since the decision by the United States Supreme Court in Kelo v. City of New London many states across the country have taken measures to help protect the rights of private ownership.  The controversial Kelo decision held that a local government can take the private property of one person and give it to another private entity.  While the Court’s ruling was seen by many as a serious blow to citizen’s constitutionally protected rights of private property ownership, the decision prompted a number of states to initiate legislative reform to help curb eminent domain abuse.

The Castle Coalition has released a report, grading each of the states based on their efforts to protect private property owners and their rights based on changes in their respective state laws.  The Castle Coalition is the Institute for Justice’s nationwide grassroots property rights activism project that teaches home and small business owners how to protect themselves and stand up to abuse by governments and developers who seek to use eminent domain to take private property for their own gain.  Stated below is the letter grade, as given by the Castle Coalition, along with a description of the changes that have occurred since Kelo v. City of New London.

Minnesota Castle Coalition letter grade of

Minnesota Property Rights

 

 

 

In 2006, bipartisan legislative reform was put in place, and a new bill was signed by the Minnesota governor. This bill, titled Senate File 2750, protected homes, small businesses and farms from eminent domain abuse in the state. The law requires properties to be blighted in order to be condemned, proving actual danger to the public or a public threat to health.

If a property is non-blighted, then the condemning authority can only proceed with eminent domain if the property is near a blighted area and there is no alternative (not condemning would turn into an inverse condemnation case). The law also prohibits municipalities from using eminent domain to transfer property from a private owner to a commercial developer or development. As stated in the bill, property owners who contest condemnation will be entitled to recovery fees if the court found that the property did not satisfy the requirements of condemnation, or if the final damage award was more than 40 percent greater than the last written offer from the condemning authority, an attorney fee award would be mandatory.

Unfortunately, this bill exempts more than 2,000 Tax Increment Financing (TIF) districts from the bill. A TIF district is a public financing method that is used in re-development and for economic improvement projects, and TIF districts are often the finance tools for municipalities. This means that local municipalities using an exempt TIF district are not required to abide by the newly tightened definition of a blighted area. Many of the TIF districts that are exempt are located in the heart of the Twin Cities, where many larger, higher priority and costly projects occur.

Summary

Although the state of Minnesota has seen some reform and further protection for private property owners, the state still has some ground to cover in order to protect the rights of private property owners. Click to read more about Senate File 2750.

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