Council reviews FEMA deed restrictions on properties acquired with Hazard Mitigation Assistance funds

Council members discussed deed restrictions that apply when the City acquires property using federal Hazard Mitigation Assistance funds. The minutes cite 44 CFR § 80.19 and state that such properties generally may be transferred only to a public entity or a qualified conservation organization; sale to private individuals is restricted and any approved private use must comply with open-space and deed restriction requirements.

City staff told the Council additional information is required to proceed, including the property address or PIN, acquisition date, and the recorded deed restrictions. The minutes also note that if state bond funds were used, the City must follow Minnesota Management and Budget (MMB) procedures — including demonstrating statutory authority, adopting a resolution declaring the property no longer needed, obtaining an appraisal at fair market value, and returning net proceeds to the State under Minn. Stat. § 16A.695, subd. 3. The minutes record that staff will coordinate with MMB and expect potential buyers to pay for required appraisals.

Why it matters: deed restrictions tied to federal HMA funds limit the City's options for disposition of property acquired for mitigation purposes and can require state coordination when bonds or state funds are involved. The minutes reflect a procedural discussion and a staff action item; no sale, transfer, or final decision was made at the meeting.

Next steps recorded in the minutes: staff will gather the required property details and consult with MMB as appropriate before any transfer or sale is pursued.