Manufactured home parks residents' right of first refusal for proposed purchase agreements clarified, and notice requirements for offers to purchase a park removed.

A bill for an act

relating to housing; manufactured home parks; clarifying residents' right of first

refusal for certain proposed purchase agreements; removing notice requirements

for certain offers to purchase a park; amending Minnesota Statutes 2024, section

327C.095, subdivision 6; repealing Minnesota Statutes 2024, section 327C.097.

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

Section 1.

Minnesota Statutes 2024, section 327C.095, subdivision 6, is amended to read:

Subd. 6.

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Intent to convert use of park at time of purchase
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Residents' right of first

refusal
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.

(a) Before the execution of an agreement to purchase a manufactured home park,
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the purchaser must notify the park owner, in writing, if the purchaser intends to close the

manufactured home park or convert it to another use within one year of the execution of

the agreement. If so,
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the park owner shall provide a resident of each manufactured home

with a 45-day written notice of the
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purchaser's intent to close the park or convert it to another

use
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proposed purchase agreement
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and may not enter into a purchase agreement for the sale

of the park other than with a representative acting on behalf of residents, until the 45 days

have expired. The notice must state that the park owner will promptly provide information

on the cash price and the terms and conditions of the purchaser's offer to residents requesting

the information. The notice must be sent by first class mail to a resident of each manufactured

home in the park and made available in alternative formats or translations if requested by

a resident and the request is a reasonable accommodation due to a disability of an adult

resident or because there is not an adult resident who is able to speak the language the notice

is provided in. The notice period begins on the postmark date affixed to the notice and ends

45 days after it begins. During the notice period required in this subdivision, a representative

acting on behalf of residents shall have the right to make an offer to meet the cash price and

to agree to material terms and conditions set forth in the purchaser's offer and to execute an

agreement to purchase the park for the purposes of keeping the park as a manufactured

housing community. The park owner must in good faith negotiate a purchase agreement

meeting the cash price and the same terms and conditions set forth in the purchaser's offer

except that the seller is not obligated to provide owner financing. For purposes of this

section, cash price means the cash price offer or equivalent cash offer as defined in section

500.245, subdivision 1
, paragraph (d). The purchase agreement must permit the representative

a commercially reasonable due diligence period with access by the representative to all

information reasonably necessary to make an informed decision regarding the purchase.

The representative may be required to enter into a confidentiality agreement regarding the

information.

(b) A representative acting on behalf of residents must provide ten percent of the offer

price as earnest money upon gaining the required number of signatures to represent the

residents in the purchase of a manufactured home park. The earnest money is refundable

after six months; however, the earnest money may become nonrefundable if the representative

acting on behalf of residents is unable to complete the purchase, and the original purchaser

withdraws the offer during the 45-day period in paragraph (a), and the manufactured home

park is sold to another purchaser for a lower price within six months of the notice to residents

in paragraph (a), then the park owner will be compensated from the earnest money for the

difference between the offer made by the original purchaser and the actual lower purchase

price.

(c) In the event of a sale to a representative acting on behalf of residents, the

representative must certify to the commissioner of commerce that the property will be

preserved as a manufactured home park for ten years from the date of the sale.

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(d) This subdivision does not apply to:

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(1) a purchase of a manufactured home park by a nonprofit or a representative acting

on behalf of residents;

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(2) a purchase of a manufactured home park by a governmental entity under its powers

or threat of eminent domain;

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(3) a transfer by a corporation or limited liability company to an affiliate, including any

shareholder or member of the transferring corporation; any corporation or entity owned or

controlled, directly or indirectly, by the transferring corporation; or any other corporation

or entity owned or controlled, directly or indirectly, by any shareholder or member of the

transferring corporation;

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(4) a transfer by a partnership to any of its partners;

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(5) a sale or transfer between or among joint tenants or tenants in common owning a

manufactured home park;

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(6) an exchange of a manufactured home park for other real property, whether or not

such exchange also invoices the payment of cash or boot;

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(7) a conveyance of an interest in a manufactured home park incidental to the financing

of the manufactured home park;

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(8) a conveyance resulting from the foreclosure of a mortgage, cancellation of a contract

for deed, or other instrument encumbering a manufactured home park or any deed given in

lieu of such foreclosure or cancellation;

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(9) a sale or transfer to a person who would be included within the intestate table of

descent and distribution of the park owner; or

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(10) a park owner who, within the past year, has provided written notice pursuant to

section 327C.096.

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(e) The exception in paragraph (d) does not apply to an agreement in which a person or

entity to whom a park will be transferred or sold intends to close the manufactured home

park or convert the park to another use within one year of the execution of the agreement.

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Sec. 2.
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REPEALER.
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Minnesota Statutes 2024, section 327C.097,

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is repealed.

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APPENDIX

Repealed Minnesota Statutes: 26-07881

327C.097 NOTICE OF UNSOLICITED SALE.

Subdivision 1.

Definitions.

For the purposes of this section, "nonprofit" means a nonprofit organization under chapter 317A.

Subd. 2.

Scope.

This section does not apply to:

(1) a purchase of a manufactured home park by a nonprofit or a representative acting on behalf of residents pursuant to a bona fide offer to purchase the park pursuant to subdivision 4;

(2) a purchase of a manufactured home park by a governmental entity under its powers or threat of eminent domain;

(3) a transfer by a corporation or limited liability company to an affiliate, including any shareholder or member of the transferring corporation; any corporation or entity owned or controlled, directly or indirectly, by the transferring corporation; or any other corporation or entity owned or controlled, directly or indirectly, by any shareholder or member of the transferring corporation;

(4) a transfer by a partnership to any of its partners;

(5) a sale or transfer between or among joint tenants or tenants in common owning a manufactured home park;

(6) an exchange of a manufactured home park for other real property, whether or not such exchange also invoices the payment of cash or boot;

(7) a conveyance of an interest in a manufactured home park incidental to the financing of the manufactured home park;

(8) a conveyance resulting from the foreclosure of a mortgage, cancellation of a contract for deed, or other instrument encumbering a manufactured home park or any deed given in lieu of such foreclosure or cancellation;

(9) a sale or transfer to a person who would be included within the intestate table of descent and distribution of the park owner; or

(10) a park owner who, within the past year, has provided written notice pursuant to section
327C.096
.

Subd. 3.

Notice of offer.

(a) If a park owner receives an unsolicited bona fide offer to purchase the park that the park owner intends to consider or make a counteroffer to, the park owner's only obligation shall be to mail a notice to the Minnesota Housing Finance Agency, by certified mail, and to each park resident household, by regular mail. The notice must indicate that the park owner has received an offer that it is considering, and it must disclose the price range and material terms and conditions upon which the park owner would consider selling the park and consider any offer made by a representative acting on behalf of residents or a nonprofit that will become a representative acting on behalf of residents, as provided below. The park owner shall be under no obligation either to sell to the nonprofit or representative acting on behalf of residents or to interrupt or delay other negotiations and shall be free to execute a purchase agreement or contract for the sale of the park to a party or parties other than the representative acting on behalf of residents. Substantial compliance with the notice requirement in this paragraph shall be deemed sufficient.

(b) The Minnesota Housing Finance Agency must, within five days of receipt of the notice required under paragraph (a), distribute a copy of the notice to any representative acting on behalf of residents and to any nonprofits that register with the agency to receive such notices. The agency shall make a list of any representatives acting on behalf of residents and any registered nonprofits publicly available on its website.

Subd. 4.

Unsolicited offer.

Nothing contained in this section or section
327C.096
shall prevent a representative acting on behalf of residents or a nonprofit from making an unsolicited bona fide offer to purchase the manufactured home park to the park owner at any time.