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4.6 SR 09-03-2024The Elk River Vision A welcoming community with revolutionary and spirited resourcefulness, exceptional service, and community engagement that encourages and inspires prosperity Request for Action To City Council Item Number 4.6 Meeting Date September 3, 2024 Prepared By Zack Carlton, Community Development Director Item Description Resolution 24-50: Condemnation through Eminent Domain - 19116 Troy St. NW Reviewed by Zack Carlton Cal Portner Tina Allard Action Requested Adopt, by motion, Resolution 24-50 authorizing the city attorney to begin eminent domain proceedings to acquire the property located at 19116 Troy Street NW. Background/Discussion City staff have been working with the HRA and the city attorney regarding the acquisition and demolition of an abandoned home at 19116 Troy Street NW. The home has been vacant for several years and the city has been working through the condemnation and hazardous building process with the city attorney. This property is unique in that the previous owner has passed away, there is no bank involved, and next of kin cannot be located - leaving the property without a legal owner to address the home's current condition. Earlier this summer, staff approached the HRA with the prospect of purchasing the home using the eminent domain process. The HRA has agreed to buy the home to mitigate the blight on the neighborhood, demolish it, and sell the vacant lot as a buildable parcel. The first step in this process requires a resolution from the City Council authorizing the use of eminent domain. Additional information regarding this property and the actions taken thus far can be found in the attached letter from the city attorney. Financial Impact The cost of acquisition is approximately $75,000. Legal fees and demolition costs will be determined later, but the city and HRA will recover a significant portion of the costs through the sale of the property as a vacant single-family parcel. Mission/Policy/Goal Ethical, efficient, and responsible. Attachments 1. Memo from the City Attorney 2. Resolution Page 40 of 197 232275v3 M E M O R A N D U M FROM: JARED SHEPHERD & JACK BROOKSBANK CAMPBELL KNUTSON, P.A. TO: ELK RIVER CITY COUNCIL DATE: AUGUST 28, 2024 RE: EMINENT DOMAIN - 19116 TROY STREET City Staff are requesting that the council pass the attached Resolution Authorizing the Use of Eminent Domain to acquire the property located at 19116 Troy St. NW, Elk River, MN 55330. This condemnation would be done by the city on behalf of the HRA, which would then purchase the property from the city. The previous owner and occupant of the property has passed away. The City has been unable to locate any spouse, family members, next of kin, or relatives of any kind. The prior owner also did not have a will. The prior occupant also owned the property outright, with no existing mortgage. Accordingly, there is currently no party that could claim ownership of the property. The property is currently sitting abandoned. Beyond simply sitting empty, the property contains hazardous conditions. The structure is decrepit and overgrown. The property has significant water damage and potential mold. The structure is not secure against entry by curious children or other parties. Prior to passing away, the prior occupant confirmed that the building was unsafe. No maintenance work has occurred on the property since that confirmation, in approximately July 2020. The City obtained an administrative search warrant and inspected the property in December 2023, confirming the pervasive presence of hazardous conditions in the property. The HRA has discussed this matter, and believes that exercising eminent domain is the best way to abate the hazardous conditions. There is no living owner of the property who could handle the necessary repairs privately. If the city does nothing, the property will eventually go through tax forfeiture. However, this process takes many years to complete. The city could also pursue an action under the Hazardous Building Act. That would allow the city to enter the property, fix the hazardous conditions, and then assess the cost of doing so against the property. But again, after doing so the property would simply continue to sit empty for several years until the completion of tax forfeiture. The only way for the city to permanently address the issues is to purchase the property. But since there is no living owner, the only way to do that is through the exercise of eminent domain. The HRA has obtained an appraisal of the property valuing it “as-is” at $75,000. The city would be required to pay this amount as a deposit into court. Anyone claiming a prior ownership interest in the property could then claim the money from the court; the city will not be able to retain it. Once eminent domain is completed by the City, the HRA will purchase the property. The HRA will then demolish the structure, remove and backfill the foundation, and make the property safe. The HRA would then sell it for private use. Page 41 of 197 232275v3 If the council agrees with this plan, it should pass the attached Resolution Authorizing the Use of Eminent Domain. Our office would then file a formal Petition with the district court to begin the eminent domain process. This would take approximately 90 days, depending on court schedule. Page 42 of 197 232273v2 City of Elk River City Council Resolution 24-____ A Resolution of the City Council of the City of Elk River Authorizing the Use of Eminent Domain WHEREAS, the City Council of the City of Elk River does hereby determine that it is necessary and for a public purpose to acquire fee title and/or permanent and temporary easements over the property legally described on the attached Exhibit “A” to abate the hazardous conditions on the property and to reduce the amount of abandoned property within the city; and WHEREAS, Minn. Stat. § 117.025, subd. 11, defines the mitigation of blight and the reduction of abandoned property to be a public purpose, and Minn. Stat. § 463.152 authorizes the City to acquire properties to address hazardous conditions; and WHEREAS, City staff and consultants have and will continue to attempt to work with the property owners to acquire the necessary property voluntarily; and WHEREAS, the City Council finds that the public health hazard makes it necessary to acquire the necessary fee title as soon as possible in order for the prevent potential injury. NOW, THEREFORE, be it resolved by the City Council of the City of Elk River, Minnesota: 1. That the City Attorney is authorized to commence eminent domain proceedings pursuant to Minnesota Statutes Chapter 117 to acquire the necessary fee title and/or permanent and temporary easements over the properties identified on the attached Exhibit “A.” 2. That the City Attorney is authorized to acquire the necessary property interests pursuant to the “quick take” provisions of Minnesota Statutes Section 117.042. 3. That the Mayor and the City Administrator are authorized to execute all documents necessary, in the opinion of the City Attorney, to effect the acquisition of the necessary property interests. 4. The City has obtained appraisals of the property being acquired and staff is authorized to continue negotiating with the any property owners relating to the acquisition of the property and to acquire the property from the property owners by negotiation if possible. Page 43 of 197 232273v2 Passed and adopted this ____ day of ___________ 2024. John J. Dietz, Mayor ATTEST: Tina Allard, City Clerk Page 44 of 197 232273v2 EXHIBIT A Description of the Property Lot 4, Block 1, Oak Knoll, Sherburne County, Minnesota. Page 45 of 197