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Chisago County commissioners voted unanimously last week to participate in the state program developed during the just-finished legislative session, that makes the county eligible to get funds from the state to resolve issues arising from dealing with tax-forfeited properties.

 A recent court ruling basically decided that any forfeiture sales that generate more than what the property was owing in delinquent tax, penalty and processing fees — should have had the excess remitted to the property owner.

The County Board action now allows Chisago County to benefit from state funding  to cover costs associated with any claims involving property owners.  

The county, however, is now required to contribute to a state fund for this program,  by transferring 75 percent of sale revenues up to June 30 2027, into replenishing the statewide pool.  This goes to 85 percent for tax forfeit property  sales from 2027 to 2029.

From June 23, 2016 to Dec. 31, 2023 is the “look back’ time frame where tax forfeited parcels may be exposed to any citizen claims.  

County Auditor-Treasurer Bridgitte Konrad commented that last year counties didn’t process tax forfeitures at a very speedy pace, because everybody was awaiting this court-induced resolution from the state. The counties after all, were just following state law when the legal issues surfaced.

Konrad told the Board there were 82 properties forfeited in this period.  Cities outright bought nine of these, and another 17 could be deeded to cities for public purposes when meeting specific conditions. Nine properties were bought back by owners and 26 were sold in a private sale.  

This leaves 21 parcels remaining.

Konrad said the legislation also puts new rules in place requiring reports and notifications and additional record-keeping  by auditor staff.  It already costs about 10 hours per parcel for current requirements, and Konrad estimates an extra two hours per parcel per year to implement the new law.

The sale of a tax forfeit parcel will have a “minimum bid” established based on what’s owed.  Revenue over and above this or “excess proceeds’ will be placed in a separate fund. Within 60 days of the sale the auditor-treasurer will notify interested parties. A claim for surplus revenues can be filed within a window of six months.

By “opting in” and participating in the statewide program, Chisago County can step away from facing claims for surpluses brought against the county directly.  The MN Department of Revenue will become the responsible party.  

In June 2023 Chisago County, and the state revenue department officials and all the counties, were listed in actions being filed on behalf of former owners seeking compensation; their argument that Minnesota law on tax forfeit sales was unconstitutional.  

In February 2024 litigants reached a settlement contingent on  this claims process and legislative financial appropriation being finalized.  On May 17,2024 Governor Walz signed the legislative funding into law providing uniform compensation for the state and setting up the framework for the program to be under the Revenue Department umbrella.

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