SF5276

Purpose

This bill would expand and reorganize how Minnesota helps manufactured home owners who must move because of changes to their parks. It creates a broader definition of “economic displacement,” makes it easier for eligible owners to get relocation assistance, and changes how money is collected and paid out through the Minnesota manufactured home relocation trust fund.

Key Definitions

• Economic displacement: an event that makes a manufactured home owner relocate because lot rent rises by more than 10% in one year, or 20% over three years, or 30% of the owner’s annual income (including increases in utilities and other charges tied to the lot).

Main Provisions and What They Do

• New definition in statute: Adds Subdivision 4a defining economic displacement and what counts as increased costs (rent, utilities, services).
• How park owners contribute (fee and collection): Park owners may collect the 15 annual payments required to participate in the relocation trust fund as either a lump sum or as part of monthly lot rent, with a fee rate not exceeding $1.25 per month to cover participation costs. The fee must be itemized and labeled clearly as part of the “Minnesota manufactured home relocation trust fund.”
• How relocation costs are paid to the fund (when displacement happens): If a manufactured home owner must move due to park conversion, closure, cessation of use, or economic displacement, the park owner must pay to the Minnesota Housing Finance Agency (MHFA) the lesser of:
  • the actual relocation costs approved by a neutral third party (and paid by MHFA), or
  • fixed amounts: $3,250 per single-section home or $6,000 per multisection home (for applications under the related relocation costs process). The payment must cover costs to move and/or purchase the home, and related moving-related expenses.
• Conditions and exclusions on payments: A park owner isn’t required to pay or a home owner isn’t entitled to payment if:
  • the owner moves the home within the park or to another park at the park owner’s expense,
  • the owner has notified the park owner of vacating before the closure notice,
  • the home is abandoned or the owner is not current on rent or personal property taxes,
  • there is an eviction action for nonpayment of rent (and a court has issued a writ),
  • the closure or conversion is due to eminent domain,
  • the owner is not a resident or moved in after the closure notice.
• Annual fund balance and park owner assessments: If the unencumbered balance in the trust fund falls below $2,000,000 as of June 30 each year, MHFA must assess each park owner by mail for a total of $15 per licensed lot, due by December 15. Notices must include information about the fund, collections, a tax credit note for park sales to cooperatives, and notice requirements for unsolicited sales. Notices to residents must clearly state that the fee is not optional and how it will be collected (as lump sum or up to $1.25 per month with rent). If lots are vacant or ineligible, the assessment can be adjusted accordingly.
• Managing fund payments and enforcement: The fund is managed with oversight by MHFA and a neutral third party. Payments are issued upon approved claims, with timelines for decisions (14 days to process after all materials are provided; 45 days to decide; otherwise the payment is deemed approved). The third party and MHFA may require documentation, and the park owner will receive payment schedules and invoices.
• Relocation costs after park closure or displacement (Section 13): If displacement happens and the owner meets requirements, the owner can receive payment from the fund equal to actual relocation costs up to set maximums:
  • Up to $7,000 for a single-section home, or up to $12,500 for a multisection home. Costs covered include moving, setting up, utilities, permits, insurance, and related adjustments to meet building and construction codes. If the owner cannot be paid from the fund, other options may apply, including a seller-friendly option to tender title or an appraisal-based settlement, with defined minimums and maximums.
• Alternative payment options and appraisals: In some cases the owner may tender title to the park owner and receive an appraisal-based payment if relocation is not possible; minimum and maximum payments apply but may be adjusted to appraised value in certain circumstances. The alternative limits include a minimum of $2,000 (single-section) or $4,000 (multisection) and a maximum of $8,000 (single-section) or $14,500 (multisection), or a percentage of appraised value if higher.
• Priority and summaries of funding: If funds are insufficient, MHFA and the neutral third party will attempt to pay out on a first-come, first-served basis by the date of approval, and MHFA must keep records of approvals and payments.

Significant Legal/Administrative Changes

• Creates a broader eligibility framework for relocation assistance by defining economic displacement and extending protections to more manufactured home owners.
• Shifts how park owners contribute to the relocation fund (monthly or lump-sum fee) and how fees are disclosed to residents.
• Establishes clear caps and procedures for relocation payments, including both cost-based and appraisal-based paths, with specific caps for different home sizes.
• Requires public reporting and regular accounting for the fund, including annual reports to legislative chairs and published online dashboards.
• Increases oversight and administration through a neutral third party and MHFA, with defined timelines and enforcement provisions.

Implementation Considerations

• The bill relies on a neutral third party to approve relocation costs and to process payments quickly (with specific deadlines).
• It uses fund balance triggers to determine when park owners must pay assessments, creating a recurring funding mechanism tied to the fund’s solvency.
• It includes explicit language to ensure residents understand the fee is mandatory.

How This Changes Your Everyday Life (Impact)

• For manufactured home owners facing displacement due to park changes, there are clearer eligibility criteria and potentially higher or more reliably available relocation assistance.
• Park owners and residents will see a new mandatory fee structure and clearer notice requirements about funding and moves.
• Localities and park owners must maintain records and participate in a state-wide fund with regular reporting.

Relevant Terms - economic displacement - manufactured home relocation trust fund - Minnesota Housing Finance Agency (MHFA) - neutral third party - closure statement - manufactured home park - park owner - relocation costs - single-section / multisection manufactured home - lump sum and monthly fee (up to $1.25) - license lots - vacant / ineligible lots - appraised value - tender title - eminent domain - personal property taxes - relocation costs caps (3,250 and 6,000; 7,000 and 12,500) - annual assessment ($15 per licensed lot) - notice to residents (including “THIS IS NOT AN OPTIONAL FEE”)