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Aitkin County updates board on 'look-back' tax-forfeiture auctions tied to Tyler v. Hennepin settlement
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Summary
Land commissioner reported on mandated 'look-back' sales tied to a state settlement, the county's auctions and over-the-counter sales, proceeds retained so far, and the timeline and percentage splits for reimbursements to the state and county.
Aitkin County’s land department updated the county board on mandated sales of tax-forfeited parcels tied to the Tyler v. Hennepin settlement and the state’s related reimbursement timeline.
Land Commissioner Dennis Thompson said state legislation tied to the settlement required counties to make a good-faith effort to sell certain non-conservation parcels that forfeited during a look-back period. "We ended up with 46 parcels total," Thompson said; when adjacent parcels were combined that produced roughly 31 tracts offered for sale.
Thompson said the state allocated $109,000,000 to settle the class action and that sale proceeds are subject to a recovery split established in statute and settlement rules. He said counties may retain a portion of sale proceeds (transcript discussion referenced a 25% county share in many cases), while a larger share is remitted to the state to fund the settlement; staff noted the percentages change based on sale timing and statutory deadlines.
The county ran multiple auctions. Thompson reported 10 tracts sold at the first auction and an additional four over-the-counter sales in the follow-up period; a second auction produced only one sale and the county planned a third auction with reduced prices for remaining tracts. He said some parcels had been reappraised to address earlier overpricing and that special-legislation approval had been obtained for parcels with encroachments where necessary.
On receipts, Thompson said so far the county had recovered tax debt and proceeds in modest amounts (he cited roughly $13,500 in tax-debt recovery and roughly $47,000 returned to the county so far) and that the county will capture additional proceeds if the remaining tracts sell. He told commissioners the county intends to argue that, after scheduled auctions and over-the-counter periods, it will have made the statutorily required good-faith effort to sell the parcels and thus may manage remaining parcels under local control or pursue trades with state agencies for certain conservation lands.
Commissioners and staff discussed administrative costs and whether internal time and appraisal expenses are recouped; Thompson said for the look-back parcels the county could not factor those internal costs into minimum bids but that new forfeiture procedures will allow capturing administrative costs going forward.
Thompson asked for the board’s continued support while staff completes remaining auctions and potential trades with the DNR for parcels in wildlife areas or landlocked tracts.
