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Home My WebLink AboutCC PACKET 09082016-SPECIAL MEETING Our Mission is to be a progressive and livable community, a walkable village, which is sustainable, safe and secure. Call to Order. Pledge of Allegiance. Roll Call. Consideration, discussion, and possible action on all of the following items: I. Preliminaries A. Call Meeting to Order B. Pledge of Allegiance C. Roll Call II. Public Hearing. A. Mayor Opening B. Review Closure Statement C. Review and Evaluate Impacts of Planned Closure 1. Public Comment 2. Evaluation D. Inform Lowry Grove Residents of Relocation Compensation from the Minnesota Manufactured Relocation Fund E. Appoint Neutral Third Party 1. Public Comment 2. Decision on Appointment F. Closure of Public Hearing III. Resolution 16-063 Lowry Grove Manufactured Home Park Closure Public Hearing September 8, 2016 IV. Adjournment. CITY OF ST. ANTHONY VILLAGE CITY COUNCIL SPECIAL MEETING AGENDA September 8, 2016 7:00 p.m. Our Mission is to be a progressive and livable community, a walkable village, which is sustainable, safe and secure. Addressing the City Council Public Hearings In keeping with Roberts Rules of Order, the following procedures apply to Public Hearings: • Mayor/Chair asks for staff report items and opens item for discussion. • Citizens wishing to speak should raise their hands and approach the podium when recognized by the Mayor/Chair, clearly state full name and address for the record. Spokespersons are given more time for presentations, and groups are encouraged to use them. • Everyone who wishes, will have a chance to address the Council/Commission, Citizens must address all questions and comments to the Mayor, who will then determine who will answer them. Questions will be answered when all people have had a chance to speak. Only one person may speak at a time. Citizens are urged to be polite and quiet as comments are made to the Council/Commission. Applauding or other displays of approval or disapproval are inappropriate during City Council/Planning Commission proceedings. • No one will be given an opportunity to speak a second time until everyone has had an opportunity to speak initially. Please limit second presentation to new information and not rebuttals. • When public comments are completed, the Council/Planning Commission closes the public hearing and starts its own discussion. The audience is welcomed to listen quietly to the discussion but is requested not to make comments. *Per Resolution 16-011 A Resolution Adopting the Standing Rules of Conduct for City Council Meetings for the Year 2016* MEMORANDUM TO: General Public FROM: City Attorney City of St. Anthony DATE: September 8, 2016 RE: Lowry Grove Manufactured Home Park Closure On June 15, 2016, the City of St. Anthony received from Continental Property Group notice that it had purchased the Lowry Grove manufactured home park (“the Park”). The notice also contained a closure statement indicating that Continental Property Group intends to close the Park by March 15, 2017. When the City receives a closure statement from the owner of a manufactured home park, it automatically becomes subject to certain duties imposed by state and city law. The Minnesota Statutes require the City to schedule a public hearing on a park closure when a closure statement concerning that park is received. Minn. Stat. § 327C.095, subd. 3. The St. Anthony City Code requires that a public hearing be held within 90 days of receiving a park closure statement. St. Anthony City Code § 111.094. The Minnesota Statutes and City Code further require that the following tasks be completed during the public hearing:  Review the closure statement, St. Anthony Code § 111.094; Minn. Stat. § 327C.095, subd. 4;  Review and evaluate the impact the closure may have on displaced residents and the park owner, St. Anthony Code § 111.094; Minn. Stat. § 327C.095, subd. 4;  Inform displaced residents that they may be eligible for payments from the Minnesota manufactured home relocation trust fund under Minnesota Statute Section 462.A.035 as compensation for reasonable relocation costs, Minn. Stat. § 327C.095, subd. 4; and  Appoint a neutral third party to act as paymaster and arbitrator, with decision-making authority to resolve any questions or disputes regarding any contributions to the trust fund by the park owner and disbursements from the trust fund to home owners. Id. Minnesota Statutes preempt, or override, all provisions of the City Code relating to compensation of manufactured home owners displaced by the park closure. Id. at § 327C.095, subd. 15. We are aware of the existence of a lawsuit challenging the legality of the sale of the Park to Continental Property Group. The City has neither the authority nor the competence to judge such a dispute. Nor does the City have any discretion under the law to modify the legal duties it must undertake upon receiving a closure statement. Accordingly, a public hearing on the closure of Lowry Grove Manufactured Home Park must be held by September 13, 2016. THIS PAGE LEFT INTENTIONALLY BLANK CITY OF ST. ANTHONY VILLAGE RESOLUTION 16-063 LOWRY GROVE MANUFACTURED HOME PARK CLOSURE PUBLIC HEARING SEPTEMBER 8, 2016 WHEREAS, Minn. Stat. § 327C.095, subd. 3 requires a municipality receiving a manufactured home park closure notice to hold a public hearing on the park closure; and WHEREAS, the City of St. Anthony Code § 111.094 requires the City of St. Anthony to hold a public hearing on a manufactured home park closure within 90 days of receiving a closure statement concerning that park; and WHEREAS, Minn. Stat. § 327C.095, subd. 4 requires that a public hearing concerning the closure of a manufactured home park accomplish the following:  Review the closure statement;  Review and evaluate the impact the closure may have on displaced residents and the park owner;  Inform displaced residents that they may be eligible for payments from the Minnesota manufactured home relocation trust fund under Minnesota Statute § 462.A.035 as compensation for reasonable relocation costs; and  Appoint a neutral third party to act as paymaster and arbitrator, with decision-making authority to resolve any questions or disputes regarding any contributions to the trust fund by the park owner and disbursements from the trust fund to home owners; and WHEREAS, Minn. Stat. § 327C.095 directs the City to “review” the closure statement and does not empower the City to determine the legal sufficiency of the closure statement; and WHEREAS, Minn. Stat. § 327C.095, subd. 4, requires the City to appoint a neutral third party that has been agreed upon by both the manufactured home park owner and manufactured home owners, or to determine the appointment of a neutral third party if the parties cannot agree; and WHEREAS, on June 15, 2016, the City of St. Anthony received from Continental Property Group notice that it had purchased the Lowry Grove manufactured home park (“the Park”); and WHEREAS, the notice also contained a closure statement indicating that Continental Property Group intends to close the Park by March 15, 2017; and WHEREAS, the City of St. Anthony City Council held a public hearing concerning the closure of the Lowry Grove manufactured home park on September 8, 2016, which public hearing met the requirements of Minn. Stat. § 327C.095, subds. 3, 4, and City of St. Anthony Code § 111.094; THEREFORE BE IT RESOLVED, the closure statement concerning the Lowry Grove manufactured home park has been reviewed, as required under Minn. Stat. § 327C.095; and FURTHER RESOLVED, the impacts of the closure of the Lowry Grove manufactured home park on displaced manufactured home resident, and the manufactured home park owner have been reviewed and evaluated; and FURTHER RESOLVED, manufactured home residents have been informed of their potential eligibility for payments from the Minnesota manufactured home relocation trust fund as compensation for their reasonable relocation costs; and FINALLY RESOLVED, _________________________________________________________ has been appointed neutral third party by agreement of the parties / determination of the Council (underline one and strike the other) to act as paymaster and arbitrator, with decision-making authority under Minn. Stat. § 327C.095, subd. 4, to resolve any questions or disputes regarding any contributions to the trust fund by the park owner and disbursements from the trust fund to home owners. Adopted this 8th day of September, 2016. ____________________________________ Jerome O. Faust, Mayor ATTEST:____________________________ Nicole Miller, City Clerk Review for Administration: ____________________________________ Mark Casey, City Manager AMENDED NOTICE OF PUBLIC HEARING CITY OF ST. ANTHONY STATE OF MINNESOTA NOTICE IS HEREBY GIVEN that the City Council of the City of St. Anthony, Hennepin County, State of Minnesota, received a statement from the private owner of the Lowry Grove Manufactured Home Park (“the Park”), Continental Property Group (“Continental”), communicating Continental’s intention to close the Park. The City is therefore required under St. Anthony Code Section 111.094 and Minnesota Statutes Section 327C.095, subd. to hold a public hearing relating to the planned closure of the Park. NOTICE IS HEREBY GIVEN that a public hearing on the closure of the Lowry Grove Manufactured Home Park will be held on Thursday, September 8, 2016, at approximately 7:00 P.M. at the St. Anthony City Council Chambers in City Hall, 3301 Silver Lake Road, Minnesota. The public hearing will: review the closure statement provided by Continental to residents and home owners of the Park; review and evaluate impacts the planned closure may have on manufactured home owners and on Continental; inform Park residents and home owners of their potential eligibility for relocation compensation from the Minnesota Manufactured Home Relocation Fund (“the Fund”) under Minnesota Statutes Section 327C.095, subdivision 13 and Minnesota Statutes Section 462A.035; and appoint a neutral third party to exercise decision-making authority and resolve questions and disputes regarding contributions to and disbursements from the Fund. Minnesota Statutes Section 327C.095, subdivision 4 provides that a neutral third party may be chosen by agreement of Continental and all owners of manufactured homes located in the park. If all the parties do not agree on a neutral third party, the neutral third party will be chosen by the City. Residents wishing to indicate their preference for a particular neutral third party candidate should indicate their preference in a writing containing the following information: • The resident’s name, address and phone number; • The neutral third party candidate’s name, address and phone number. Residents are encouraged to submit the name and contact information of their preferred neutral third party candidates by U.S. mail or hand delivery to the City of St. Anthony City Clerk, at 3301 Silver Lake Road, Minnesota, by Wednesday, August 31, 2016. All interested persons may appear at the hearing and present their views on the Park closure and the neutral third party orally or prior to the meeting in writing. Residents seeking information on the Minnesota Manufactured Home Relocation Fund may contact the Minnesota Housing Finance Agency at 651-296-3617. BY ORDER OF THE CITY COUNCIL OF THE CITY OF ST. ANTHONY, MINNESOTA /s/ City Manager STATE OF MINNESOTA DISTRICT COURT COUNTY OF HENNEPIN FOURTH JUDICIAL DISTRICT Case Type: Other Civil (Consumer Protection) Aeon, a Minnesota non-profit corporation, Maria Antonia Alvarez Baez, and Lowry Grove Residents Association, Plaintiff, vs. Lowry Grove Partnership, LLP, a Minnesota limited liability partnership, and The Village, LLC, a Minnesota limited liability company, Defendants. Court File No. 27-CV-16-9809 Hon. Joseph R. Klein MEMORAMDUM OF AMICUS CURIAE THE ATTORNEY GENERAL OF THE STATE OF MINNESOTA LORI SWANSON Attorney General State of Minnesota JASON PLEGGENKUHLE Assistant Attorney General ADAM WELLE Assistant Attorney General 445 Minnesota Street, Suite 1200 St. Paul, Minnesota 55101-2130 (651) 757-1354 (Voice) (651) 296-1410 (TTY) Attorneys for Amicus Curiae the Attorney General of the State of Minnesota 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 1 INTRODUCTION1 As amicus curiae, the State of Minnesota, by its Attorney General, seeks to provide proper context and construction of Minn. Stat. § 327C.095 to ensure that the statute is not applied to enable the wrongful closure of Lowry Grove or other manufactured housing communities. Section 327C.095 is a vital protection for such communities, enacted to prevent harms to residents caused by displacement and to maintain an important source of affordable housing in Minnesota as such housing becomes increasingly scarce. The statute serves this purpose by granting a “right of first refusal” to park residents when a developer offers to purchase and close a park. Injunctive relief and other private remedies are available, and such relief is only limited insofar as “questions of marketability of title shall not be affected.” Thus, as here, when a seller and buyer-developer structure and execute a transaction to deny residents the “same terms and conditions” afforded the developer and prevent a meaningful opportunity for residents to exercise their right, the statute is violated and the developer should be enjoined from closing the park. Any other conclusion would allow developers to circumvent residents’ rights and continue the eradication of manufactured housing in Minnesota. BACKGROUND I. THE IMPORTANCE OF MANUFACTURED HOUSING TO ITS RESIDENTS AND THE STATE. The Twin Cities continues to struggle to maintain affordable housing, which has recently hit record lows. Falling Further Behind: 2014 Affordable Housing Production in the Twin Cities Region, METROPOLITAN COUNCIL, Dec. 2015. The Metropolitan Council recently reported that 1 The Court granted the Attorney General leave to participate as amicus on August 2. In accordance with Minn. R. App. P. 129.03, the Attorney General states that this brief was prepared solely by the Attorney General’s Office and that no party made a monetary contribution toward its preparation or submission. 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 2 “there is an especially acute shortage of housing units affordable to people with very low- and extremely low-incomes,” namely those who make 50% and 30% of the area median income, respectively. Manufactured Home Park Equity Grant Report, METROPOLITAN COUNCIL, June 8, 2016, at 5. The Met Council found that “[g]iven shrinking public resources for affordable housing, manufactured housing units stand out as an especially important source of housing affordable to some of the region’s most economically vulnerable residents.” Id. at 3. The report highlighted data showing that manufactured housing provides low-income residents with unique opportunities to attend high-performing schools, along with access to social services, job centers, and mass transit. Id. at 9-11. Manufactured housing residents are able to own their own home and only lease the land underneath it, their homes are economical, and they can obtain tax deductions tied to homeownership. Publication 936: Home Mortgage Interest Deduction, IRS, 4 (2015). Manufactured housing offers many people the only realistic opportunity to become a homeowner. Equity Grant Rep. at 6. This allows for greater stability: 42% of manufactured housing residents have lived in their home for ten years or more. Manufactured Home Parks in Minnesota, ALL PARKS ALLIANCE FOR CHANGE, http://www.allparksallianceforchange.org/?q= reports/mnparks. Median income for manufactured housing owners is $40,000—less than half the median of all homeowners in the Metro Area. A Resource at Risk: The Twin Cities Region’s Manufactured Housing in 2015, METROPOLITAN COUNCIL, June 2016. 44% of manufactured home residents are below 185% of federal poverty levels, compared to 22% for the rest of the region. Id. at 4. Nevertheless, manufactured housing communities are under serious threat from redevelopment pressures. Since 1991, ten manufactured home parks in Minnesota have closed and no new parks have been built. Equity Grant Rep. at 5. Such closures have a 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 3 disproportionate effect on residents of color. Id. at 9. A high percentage of those living in manufactured homes are children. Id. at 10. Costs and harms caused by dislocation can be disastrous. Contrary to the term “mobile home,” most of these units are very difficult, if not impossible, to relocate because their structural integrity may not withstand removal and relocation. Id. at 3. Thus, residents forced to move—who are already low- and moderate- income—face severe monetary losses they cannot afford when a park closes. Id.2 II. THE LOWRY GROVE MANUFACTURED HOME PARK. The above issues are exemplified by the Lowry Grove community, located in St. Anthony, Minnesota, within a mile of I-35W. Lowry Grove is minutes from Downtown Minneapolis and many job and activity centers in the Metro Area that are accessible by mass transit. It solicits applications for rent at $425 per month (plus metered water and sewer payments). Lowry Grove, PLJ Realty, http://www.pljrealty.com/lowry-grove/. It is located in the St. Anthony school district, which has high overall academic performance. (Compl. ¶¶ 5-6, Add. 83.) St. Anthony Village Senior High is ranked the third-best high school in Minnesota by U.S. News & World Report. Opportunities to attend such high-performing schools were a specific concern in the Met Council’s report. The report found that children, “who represent nearly a quarter (23%) of park residents, are well positioned to take advantage of good educational resources that can raise their overall educational attainment levels. Manufactured home parks offer affordable housing options in high-performing school districts. . . . Connecting school-age children to high-performing 2 While the Legislature established a relocation trust fund to partially assist displaced residents, such funds are limited to moving expenses up to $12,500 (as of 2016) and do not cover many costs or lost investment, nor do they cover higher housing costs or intangible losses. Minn. Stat. § 327.095, subd. 4, 13 (as amended by 2016 Minn. Laws ch. 189, art. 13, § 60). 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 4 schools helps enhance their social and economic mobility and is crucial for breaking inter- generational poverty and increasing educational attainment.” Equity Grant Rep. at 10. The Attorney General has received over 25 letters from Lowry Grove residents whose families face the devastating prospect of being forced to leave their homes and community. The financial consequences of this displacement, along with the intangible loss of their homes, neighborhood, and educational opportunities, will have severe impact on their lives and the State. III. MINN. STAT. § 327C.027. To prevent such harm (as discussed infra), the Minnesota Legislature in 1991 enacted Minn. Stat. § 327C.095, subd. 6 and 7, creating a statutory “right of first refusal” for residents faced with closure or conversion of their park by a park’s owner or a new purchaser. 1991 Minn. Laws. ch. 26, §§ 2-3. The statute requires a buyer to notify a seller of plans to close and redevelop park property and requires the owner to then notify residents of the offer and buyer’s intent. Upon this notice, residents have a 45-day period in which they or a nonprofit with written permission of “owners of at least 51 percent of the manufactured homes in the park” may purchase the park under the “same terms and conditions” initially offered by the developer. Id. IV. DEFENDANTS’ CONDUCT AND AGREEMENTS TO CLOSE AND REDEVELOP LOWRY GROVE. Defendant Lowry Grove Partnership (“LG Partnership”) owned Lowry Grove. In early 2016, Defendant Continental Property Group (“Continental”) negotiated contracts to buy the park and incorporated Defendant The Village, LLC (“The Village” or “TVL”) on April 20 to assume rights to the transaction. The “Lowry Grove Transaction” (as they called it) was executed in three parts: a January 25 Letter Agreement (“Letter Agreement” or “LA”), an April 27 “Purchase Agreement” (“Purchase Agreement” or “PA”), and a June 13 closing (“Closing”). 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 5 A. Defendants’ January Letter Agreement. Defendants’ Letter Agreement referenced the planned Purchase Agreement and Closing to be held after Continental was afforded inspection and met certain contingencies. (LA ¶ 1.1, 2.) It recognized its binding nature except for payment and other terms of the planned sale— including a $6 million price and $1 million in refundable earnest money to be paid upon the Purchase Agreement’s execution. (Id. at 1, ¶ 2.1(a)-(c).) In exchange, Continental would acquire Lowry Grove, property related to managing the park, and leases. (Id. ¶ 2.1(d).) Continental was guaranteed a 120-day “Inspection Period” to, among other things, evaluate the homes, environmental assessments, and other materials provided by LG Partnership, and “obtain redevelopment financing terms.” (Id. ¶ 1.1-.5.) It could cancel at any time upon making two refundable payments totaling $70,000 (“Inspection Period Payments”). (Id. ¶ 1.3.) LG Partnership was prohibited from giving information or cooperating with anyone else regarding the sale (including park residents) and the arrangement was confidential. (Id. ¶ 1.4, 5.) The Letter Agreement referenced the statutory right of first refusal, the exercise of which would result in a refund of nearly all earnest money. (Id. ¶ 3.) Under planned terms, any “obligation to purchase” would be “contingent upon” Continental’s “satisfactory due diligence investigation” and “obtaining satisfactory redevelopment financing.” (Id. ¶ 2.1(j).) B. Defendants’ April Purchase Agreement and Notification of Sale to Park Residents. Over two months later, on April 26, LG Partnership notified residents that it planned to sell the park to Continental, which in turn planned to close the park and redevelop the property. (Compl. ¶ 12, Add. 000018-19; TVL Ans. ¶ 12.) The next day, Defendants executed the Purchase Agreement, which outlined the property, leases and contracts that Continental would assume, permits and licenses, and tenant deposits—all through incorporating exhibits detailing 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 6 these interests. (PA ¶ 1.A-G) The Agreement granted Continental rights to more inspection, access to the land and documents, and a continued financing contingency. (Id. ¶ 7.A-D.) Specifically, Continental received at least 48 more days to continue its review and secure financing before closing and could cancel and receive a refund of earnest money at any time until closing. (Id.) The Purchase Agreement did not change the $6 million purchase price. (PA ¶ 4.) This included the previously-made $70,000 in Inspection Period Payments and an additional $930,000 in earnest money to be paid two days after the Purchase Agreement’s execution (April 29). (Id. ¶ 4.A-.D.) Continental had until closing to produce “such consents and authorizations as reasonably necessary to evidence [its] authority to purchase the Property.” (Id. ¶ 6.C(13).) The Agreement was explicit that residents’ 45-day right of first refusal period would “overlap” with the Inspection Period and Defendants’ performances leading up to closing. (Id. ¶ 43.) C. Park Residents’ Exercise of Right of First Refusal and Defendants’ Closing. On May 9, Continental’s managers met with park residents to discuss the notice and right of first refusal. Defendants’ position was and remains that the residents needed to come up with $1 million in earnest money and agree to the $6 million price offered by Continental before Defendants’ planned June Closing. (Ans. ¶ 2, 14(a); Christy Aff. Ex. A.) Despite long odds, the community organized, collected signatures, and located a local nonprofit, Aeon, to seek financing. (Arthur Aff. ¶¶ 2-4.) Residents requested the offer and, in response, were given the Purchase Agreement but not its exhibits or the Letter Agreement. (Id. ¶ 8.) Shortly before the 45-day deadline on June 10, Aeon presented an executed Purchase Agreement and delivered it to LG Partnership. Aeon represented that its acceptance was on behalf of the owners of Lowry Grove homes. (Compl. ¶¶ 15-17, TVL Ans. ¶ 15-17.) Aeon’s 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 7 Purchase Agreement was identical to Continental’s with limited exceptions: (a) the name of and references to the “Buyer” were changed from information about Continental to that about Aeon; (b) the schedule of the closing triggered by completion of the inspection period was adjusted based on the new Purchase Agreement date; (c) reference to the residents’ right of first refusal was inapplicable and deleted; and (d) the Agreement did not include the exhibits (because LG Partnership never provided them). (Compl. Add. 000051-80.) When they received Aeon’s Purchase Agreement on Friday, June 10, Defendants did not treat it as executed. Instead, without holding any discussions with Aeon, they closed their own deal the next business day—Monday, June 13—two days before they were required to do so.3 (Id. ¶¶ 18-19; TVL Ans. ¶¶ 18-19.) That morning, LG Partnership sent a letter to Aeon stating it denied the park residents’ exercised right of first refusal because acceptance would result in a deferred closing and “a whole new round of contingencies,” and it questioned whether Aeon “had the ability to obtain funding.” (Compl. Add. 000094-95.) LG Partnership also stated that it believed the signatures provided with Aeon’s executed Purchase Agreement “were duplicative, incomplete, or by persons other than an owner of a manufactured home.” (Id.) The parties disagree over whether Aeon had the requisite signatures.4 Regardless, Defendants closed and transferred title on June 13. (TVL Ans. ¶¶ 18-19.) Then, on 3 It is unclear exactly when the closing date was required to occur under Defendants’ version of the Purchase Agreement because it was a contingent date, set to occur three business days after the end of the Inspection Period, which would not begin until the later of the Purchase Agreement’s execution or Continental’s receipt of “the last of the “property Documentation.” (PA § 6A.) The pleadings do not reveal when the last of the “Property Documentation” was delivered, so the closing deadline is unclear. If the Inspection Period was counted from the date of executing the Purchase Agreement (an event almost certain to predate last delivery of documentation), the closing deadline would be June 15. 4 The parties also appear to dispute the required timing and manner in which Aeon needed to prove its authority to purchase. When Aeon sent the executed Purchase Agreement, it enclosed pages from a petition authorizing the purchase. (Id. ¶ 17, Add. 000081-92; TVL Ans. ¶ 17.) Aeon argues that, even if it were required to prove authority to purchase at that time, the petition contained requisite signatures. Aeon nevertheless submitted two pages inadvertently omitted from that disclosure two days later (on June 16). (Id.) 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 8 June 15, The Village’s Vice President filed an affidavit to extinguish residents’ right to purchase under § 327C.095, subd. 11. (TVL Ans. Ex. A.) She stated, based on “personal knowledge,” that Defendants complied with the statute. (Id.) If the park is closed, residents will likely lose their homes and only feasible option for affordable housing in the area where they work, send their kids to school, and have long-held community relationships. (Compl. ¶¶ 5-6; Baez Aff. ¶ 1.) ANALYSIS I. THE LEGISLATURE AMENDED § 327C.095 TO PROTECT MANUFACTURED HOME RESIDENTS FROM HARMS CAUSED BY PARK CLOSURES AND TO PRESERVE AN EVER- SCARCE FORM OF AFFORDABLE HOUSING FOR THE STATE. The parties’ motions will require proper construction of § 327C.095. “The object of all interpretation and construction of laws is to ascertain and effectuate the intention of the legislature.” Minn. Stat. § 645.16. A statute “free from all ambiguity” is applied by its plain language. Olson v. Ford Motor Co., 558 N.W.2d 491, 494 (Minn. 1997). Courts presume that the Legislature does not intend an “absurd” or “unreasonable” result, “intends the entire statute to be effective and certain,” and “intends to favor the public interest as against any private interest” (among other presumptions). Minn. Stat. § 645.17. When there is room for ambiguity, the Legislature’s intention can be ascertained by considering, among other things: (1) The occasion and necessity for the law; (2) The circumstances under which it was enacted; (3) The mischief to be remedied; (4) The object to be attained; (5) The former law, if any, including other laws upon the same or similar subjects; (6) The consequences of a particular interpretation; (7) The contemporaneous legislative history; and (8) Legislative and administrative interpretations of the statute. Id. Legislative history includes the “records of legislative hearings,” especially statements of bill or amendment sponsors. Thorson v. Billy Graham Evangelistic Ass’n, 687 N.W.2d 652, 656-57 (Minn. App. 2004) (citing Baker v. Ploetz, 616 N.W.2d 263, 269 (Minn. 2000)). 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 9 A. Section 327C.095 Should be Liberally Construed to Give Effect to the Legislature’s Public Interest to Protect Manufactured Home Residents and Their Communities. The plain language of § 327C.095 demonstrates the statute’s purpose in preventing and remediating the significant harm caused by park closures. Subdivisions 6 and 7, among other sections protecting residents, were added in 1991 as House File (“HF”) 172/Senate File (“SF”) 154. Act of April 17, 1991, ch. 26, S.F. No. 154, Minn. Laws 47. Before the 1991 amendments, the statute ensured notice of planned closures, procedural rights for residents and notice-and- hearing requirements before local authorities, and certain limited compensation for relocation expenses. Ch. 26 Minn. Laws, § 1-2; Minn. Stat. § 327C.095, subds. 1-5. Sections 2 through 4 of the 1991 Act added, inter alia, subdivisions 6 and 7, which includes requirements for: (a) notification of plans to close the park from the purchaser to the owner and from the owner to residents, (b) a 45-day period for residents or a nonprofit authorized by owners of 51% of homes to “meet the cash price and execute an agreement to purchase the park for the purposes of keeping the park as a manufactured housing community,” (c) residents’ right to “meet[] the cash price and the same terms and conditions set forth in the purchaser’s offer” except for “owner financing”, and (d) the right of residents to be notified and purchase the property when the buyer “decides to convert the park to another use . . . within one year after the purchase of the park.” Id. These provisions clearly reveal legislative intent to protect residents from displacement and ensure they have a meaningful opportunity to purchase on the same terms as a developer. Courts addressing other states’ analogous laws have observed these purposes and interpreted those laws in accordance therewith. As stated by Massachusetts’ highest court: The goal of the statute is to avoid discontinuances of manufactured housing communities and to ensure that tenants of such communities are not left at the peril of their landlords due to a practical inability to relocate a manufactured housing unit. The statute enables residents of manufactured housing communities to purchase the land on which their homes exist and thus avoid discontinuances of 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 10 manufactured housing communities. This creates stability for those homeowners and promotes continued existence of affordable housing. It is difficult to imagine a more appropriate and close-fitting method to further the legitimate interest of the Commonwealth. Greenfield Country Estates Tenants Ass’n v. Deep, 666 N.E.2d 988, 990 (Mass. 1996) (citations omitted); see also McQuillan v. Engelman, No. X06CV 990153482S, 2000 WL 805225, *2 (Conn. Super. Ct. May 15, 2000) (“The clear intent of the law is to provide specific rights and afford certain protections to mobile manufactured homeowners. . . . [L]egislative intent [is] to avoid the severe consequence of dislocating mobile manufactured homeowners by an owner unilaterally closing a park.”); Keeney v. Olio, No. 82-2567, 2001 WL 770946, *4 (R.I. Super. Ct. June 25, 2001) (“The Legislature’s intent is to protect mobile home owners from being displaced and forced to relocate to an already limited number of mobile home parks throughout the state.”). The Minnesota Supreme Court elaborated on the intent behind ch. 327C when it reviewed § 327C.13, which guaranteed residents’ right to expression and found clear purpose in correcting “the imbalance of power between manufactured home owners and park residents.” APAC v. Uniprop Manuf. Hous. Cmty. Income Fund, 732 N.W.2d 189, 197 (Minn. 2007); accord Arcadia Dev. Corp. v. City of Bloomington, 552 N.W.2d 281, 286-87 (Minn. App. 1996) (finding purpose of ordinance mandating relocation payments as “protecting mobile home park residents from severe or complete losses of substantial investments in their homes when the park owner decides to close their park by selling the land or changing its use”). Moreover, the Minnesota Court of Appeals interpreted an analogous statutory right of first refusal within § 500.24—providing the right to farmers facing a foreclosure sale—as the Legislature “clearly express[ing] its preference that foreclosed property remain in the possession of its former owner whenever possible.” Harbal v. Fed. Land Bank of St. Paul, 449 N.W.2d 442, 446-47 (Minn. App. 1989); see also Ag 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 11 Servs. of Am., Inc. v. Schroeder, 693 N.W.2d 227, 232 (Minn. App. 2005) (“In establishing the right of first refusal, the legislature intended to grant farmers a substantive right, which was recognized by the courts.”). Harbal recognized the right of first refusal statute in § 500.24 as “remedial” and thus “liberally construed” in favor of protecting the people for whose benefit it was enacted. Id; see S.M. Hentges & Sons, Inc., 777 N.W.2d 228, 232 (Minn. 2010) (“Remedial statutes are generally entitled to liberal construction in favor of the remedy the statutes provide or the class they benefit.”) In the same way, § 327C.095 is intended to protect a group of Minnesotans from the unique harms caused by park closings and preserve affordable housing for low-income people. Accordingly, § 327C.095 must be liberally construed in favor of protecting park residents and their rights provided under this statute. B. Section 8.31, Subd. 3a, Provides for Injunctive Relief Against Any Party that Participates in a Violation of the Statute. Subdivision 9 of § 327C.095 provides that “noncompliance” is subject to Minn. Stat. § 8.31, which allows claimants to sue as “private attorneys general” for injunctive relief and other remedies. Minn. Stat. § 8.31, subd. 3a; Ly v. Nystrom, 615 N.W.2d 302, 310 (Minn. 2000). A plaintiff can seek relief from any person who participates in the violation. Rule 65 is clear that injunctions may be granted against any party and “persons in active concert or participation with them.” Minn. R. Civ. P. 65.04. Courts weighing injunctions concerning public interests have noted they “may act so as to . . . accord full justice to all the real parties in interest [and] if necessary, persons not originally connected with the litigation may be brought before the court so that their rights in the subject matter may be determined and enforced.” Porter v. Warner Holding Co., 328 U.S. 395, 398 (1946); see also Witzman v. Lehrman, Lehrman & Flom, 601 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 12 N.W.2d 179, 185–186 (Minn. 1999) (“It is well-recognized that all who actively participate in the commission of a tort, or who procure, command, direct, advise, encourage, aid, or abet its commission, or who ratify it after it is done are jointly and severally liable for the resulting injury.”); RESTATEMENT (SECOND) OF TORTS § 876 (1979) (providing liability for wrongful conduct based on participating “in concert” or in “common design” or gives “substantial assistance or encouragement” to the conduct). Subdivision 9 does provide that “residents do not have any continuing right to purchase the park” following a completed sale “in violation of subdivisions 6 or 7” and that “relief [under § 8.31] shall be limited so that questions of marketability of title shall not be affected.” But this qualification should not be construed more broadly than its plain language provides. See S.M. Hentges, 777 N.W.2d at 232 (noting that exceptions within remedial statutes are “construe[d] . . . narrowly”). Long-standing doctrine provides that “provisos appended to legislative enactments are not intended to impair or destroy the main purpose” and should be “construed strictly, and their scope limited to avoid a result manifestly not in harmony with the legislative intent.” State v. Twin City Tel. Co., 104 Minn. 270, 118 N.W. 835, 835 (1908). Thus, all other remedial forms available to the Court, including but not limited to injunctive relief, in a private action under § 8.31, subd. 3a, remain unaffected by the qualification. Accordingly, the Court’s authority to fashion injunctive relief is preserved so long as it does not “affect” “questions of marketability of title.” If the Legislature abrogated more than that, it must be clear in doing so. Porter, 328 U.S. at 398 (“Unless a statute in so many words, or by a necessary and inescapable inference, restricts the court’s jurisdiction in equity, the full scope of that jurisdiction is to be recognized and applied. The great principles of equity, securing complete justice, should not be yielded to light inferences, or doubtful construction.”) 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 13 C. The History of § 327C.095 Affirms the State’s Construction of the Statute.5 On February 11, 1991, the House of Representatives’ Housing Committee first took up HF 172, sponsored by then-Rep. Alice Johnson. On February 19, the Senate considered the companion bill, SF 164, sponsored by Sen. Gene Merriam. According to Rep. Johnson, “the reason that this bill is here . . . is because I’m very interested in trying to protect and continue to . . . have affordable housing available to people of the State of Minnesota.” (AGO Decl. Ex. 1, at 2-3.) Senator Merriam offered the same sentiment. (Id. Ex. 3, at 2-3.) The bill sponsors then marshalled witnesses to testify to the realities of moving a manufactured home and the importance of manufactured housing parks in fulfilling the State’s need for affordable housing. (Id. Ex. 1 at 4-8, 9-11, Ex. 3 at 8-12.) This reinforces the clear intent described in section I.A supra—i.e., to protect residents from displacement and provide them a meaningful opportunity to purchase the park on the same terms as the developer. This was reiterated in final hearings before the Senate Judiciary Committee. (Id. Exs. 5-8.) Prompting the “marketability of title” condition, the February 11 House committee heard from James Nielson, a real-estate attorney who expressed fears of widespread clouds on title: The title problem is that . . . we can’t prove what property is a manufactured home park, what property is not. We can’t prove what notices have been given or notices not given. We can’t prove what the intent is of the people to change the use of their parks. Therefore, [the statute] applies not only to manufactured home parks but it applies to your vacant property. . . . It makes the title unmarketable; therefore, it can be argued by some conservative attorneys that this bill will make all titles in the State of Minnesota unmarketable. (Id. Ex. 1 at 13, 15-16.) In direct response to this concern, Rep. Andrew Dawkins sponsored the amendment that included subdivision 9’s limitation. (Id. at 13-14, 17-19, 21-23.) He addressed 5 With this memorandum the State has filed a declaration (“AGO Decl.”) attaching all legislative history retained by the Minnesota Historical Society related to HF 172/SF 164. 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 14 the issue by “ma[king] it clear that should a park be sold contrary to subdivision 6 or 7 that the only remedy that the residents in the park have is to sue under a violation of this law for something besides ownership of the land.” (Id.) Rep. Dawkins, upon questioning, was clear that this limitation was meant to protect future buyers of all types of property from generalized title uncertainty and was not to immunize buyers complicit in a violation from liability. (Id. at 22-23.) II. THIS CASE INVOLVES CONCERTED VIOLATIONS OF § 327C.095 THAT SHOULD BE ENJOINED TO PREVENT THIS AND FUTURE PARK CLOSURES. This case involves several actions by Defendants to undermine, circumvent, and violate § 327C.095. If Defendants are able to structure and execute park sales and closures in this manner, Lowry Grove will close, Minnesota will lose yet another manufactured home park (the 11th since 1991), and affordable housing will continue its decline in the Metro Area. A. Park Owners and Developers Should Not Be Permitted to Withhold or Conceal From Park Residents Key Terms and Buyer Conditions Afforded the Developer. Subdivision 6 provides that residents are entitled to “information on the cash price and the terms and conditions of the purchaser’s offer” upon request. This is to allow for the “right to meet the cash price and execute an agreement” on “the same terms and conditions set forth in the purchaser’s offer.” This plain language required Defendants to afford “the same terms and conditions” to park residents as they did to Continental. Indeed, the specific inclusion of the word “conditions” confirms that residents were entitled to all purchasing contingencies within Continental’s offer. BLACK’S LAW DICTIONARY 354-55 (10th ed. 2014) (defining “condition” as “[a] future and uncertain event on which the existence or extent of an obligation or liability depends; an uncertain act or vent that triggers or negates a duty to render a promised performance” and citing RESTATEMENT (SECOND) OF CONTRACTS § 224 cmt. (a) (1981)). 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 15 But Defendants did not provide several key terms and conditions of their transaction to residents. They never provided the Letter Agreement, which included (among other benefits to Continental) 120 days to conduct a first round of inspection and a financing contingency. Moreover, Defendants—when they turned over the Purchase Agreement to residents—did not include its exhibits. Those documents identified inventory to be sold by LG Partnership and its related entity PLJ Homes, the schedule of leases and contracts that Continental would assume, permits and licenses, and tenant deposits. The exhibits were clearly “terms” of the transaction and their review was a necessary condition to the deal. It also appears that LG Partnership never provided residents with a purchase price for property and buildings then owned by PLJ—which was to be “negotiated” sometime after Defendants signed their Purchase Agreement but before closing. Park owners should be required to provide all terms and conditions to park residents, and the Court should recognize the violation to prevent future wrongful conduct.6 B. Park Owners and Developers Should Not Be Permitted to Deny Park Residents Benefits of a Closing Schedule and Contingencies Afforded to the Developer. Subdivision 6 provides park residents “the right to meet the cash price and execute an agreement” that includes “the same terms and conditions set forth in the purchaser’s offer.” But here, Defendants refused to accept the exercise of the residents’ right of first refusal unless it followed Defendants’ planned closing date of June 15 (the business day after the 45-day period 6 Such failures would also violate requirements for contractual rights of first refusal (not construed as strictly in favor of the right-holder or under doctrines concerning remedial statutes). Under contract caselaw, a seller must offer and supply an offer’s essential terms and conditions in a reasonable manner that “provides the right-holder with sufficient information to make an informed decision about exercising the right of first refusal.” Drydal v. Golden Nuggets, Inc., 672 N.W.2d 578, 585 (Minn. App. 2003), aff’d 689 N.W.2d 779 (Minn. 2004); accord 49 AM. JUR. 2D LANDLORD & TENANT § 304 (stating that offer triggering right of first refusal must be “communicated in such a form as to enable [the right holder] to evaluate it and make a decision”). Not providing or offering important conditions under the January 2016 Letter Agreement or important exhibits necessary to assess the offer would violate these basic principles. 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 16 to exercise the right of first refusal). This resulted in residents needing to accept less favorable terms and conditions than offered to Continental. Benefits not afforded residents included: - under the Letter Agreement, a 120-day period for inspection and arranging financing before execution of the Purchase Agreement and full payment of earnest money; - an additional 45-day inspection period after execution of the Purchase Agreement in which earnest money would remain almost entirely refundable; - a right to review issues as to title insurance for a reasonable time before closing; - a right to environmental assessments, surveys, title policies, and other records and documents necessary to assess the purchase price and terms, and obtain financing, both before signing the Purchase Agreement and before closing; - a right to physical examination and inspection of the property and all utility systems; - a right to make progressive “Inspection Payments” throughout the inspection period as opposed to being required to make a lump-sum earnest money payment at the time of the Purchase Agreement and without any prior right to inspection; - a right to a financing contingency, with aid of an inspection and due diligence process to be used in obtaining financing; - a right to request additional documents from seller to be provided at closing; and - a right to negotiate a price during the inspection period for property and buildings owned by LG Partnership’s affiliate PLJ. Many of the above provisions were important “conditions” to Continental’s performance, and the park’s residents were entitled to those same conditions according to the plain language and intent of the statute. The Court should find that denying important conditions to park residents is improper and prevent future like violations. C. Park Owners and Developers Should Not Be Permitted to Unreasonably Refuse Park Residents’ Exercise of the Statutory Right of First Refusal. Subdivision 6 also provides that “the park owner must accept the offer if it meets the cash price and the same terms and conditions set forth in the purchaser’s offer.” Here, Plaintiffs— despite being deprived of key terms, inspection rights, and contingencies afforded Continental— 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 17 organized, found a nonprofit to represent them and seek financing, and were ready to promptly pay $1 million in earnest money. Yet, Defendants refused to recognize the exercised right based on several improper rationales. First, they claimed that the exercise was inadequate because it would result in a later closing date, uncertainty over the financing contingency, and a new round of inspections. As explained above, such a rationale, if accepted, would deny park residents the right to beneficial contingencies afforded to the buyer-developer and would foreclose park residents from ever enjoying “the same terms and conditions” as those provided to the buyer- developer. This would clearly subvert legislative intent. Second, Defendants claimed that Plaintiffs did not prove before the 45-day deadline that Aeon was authorized to purchase. But that is plainly not a requirement of subdivision 6—which only requires that the right be exercised by a “nonprofit . . . which has” permission of owners from a majority of homes. If it were imposed now, it would effectively shorten the 45-day window the Legislature carefully designed to permit residents to evaluate the offer and exercise the right.7 Defendants’ claim also lacks merit because they refused to engage in discussion over their purported disputes regarding Aeon’s authority, and instead rushed to close at least two days before their own deadline. Their claim is further contradicted by the terms of their own Purchase Agreement allowing Continental until closing to produce “such consents and authorizations as reasonably necessary to evidence Buyer’s authority to purchase the Property.” Yet another section provided that inadvertencies related to documents would be subject to reasonable assurances and supplements before or after closing. These terms were denied to park residents. 7 Engrafting such a requirement would surely add complications. A household member may not be the “owner” but may have authority to provide “written permission” for the owner. Also, determining “ownership” may require thorny consideration of records, legal questions, and factual issues. 98 DUNNEL MINN. DIGEST PROPERTY § 1.04 (stating various definitions in Minnesota caselaw of “ownership, “the fact-intensive nature of the inquiry, and that a “presumption of ownership arising from a certificate of title can be rebutted”). 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 18 Under contract principles, a seller must act reasonably and in good faith not to prevent the exercise of a right of first refusal. Drydal, 689 N.W.2d at 785. Such reasonableness is even more essential under statutory rights of first refusal, subject to “strict compliance” to ensure that the holder has a meaningful opportunity to purchase. See Ag Servs., 693 N.W.2d at 232 (holding that creditor failed to give effective notice and affidavit under provisions of statutory right of first refusal to farmer following foreclosure). If Defendants are permitted to unreasonably deny park residents’ right and hurry to cut off their ability to prevent park closure, it would provide license for future owners to engage in similar conduct and harm both residents and the public. D. Park Owners and Developers Should Not Be Permitted to Engage in Overall Concerted Action Designed to Circumvent or Render Impossible Park Residents’ Exercise of a Right of First Refusal. Cases applying contractual rights of first refusal provide that conduct by a seller and buyer with the overall purpose of circumventing the right is a wrongful breach of good faith: Even if the specific acts of the lessor and third party, considered in isolation, would not have been sufficient to trigger the lessee’s right of first refusal under a literal reading of the terms of the lease agreement, the lessee may be able to establish a right to purchase the leased property by showing that the lessor acted in a manner calculated to circumvent the lessee’s rights. James Lockhart, Causes of Action by Lessee of Real Property to Enforce Purchase Option or Right of First Refusal, 26 CAUSES OF ACTION 295 (2016); accord Peters v. Smolian, 12 N.Y.S.3d 824, 841 (N.Y. Sup. Ct. 2015) (“When a property owner and a potential buyer attempt to circumvent another’s right of first refusal, the covenant of good faith and fair dealing is breached.”); David A. Bramble, Inc. v. Thomas, 914 A.2d 136 (Md. 2007) (noting that non- holder “cannot engage in any subterfuge or devious means to prevent the other party from performing, and then use that as an excuse for failing to keep his own commitment”). 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 19 The overall conduct underlying Defendants’ transaction shows subterfuge and a design to circumvent residents’ right. First, Defendants concealed their Letter Agreement and ensured that LG Partnership would not “provide information” or “cooperate with” others, including residents, “with respect to any sale or other disposition of the Lowry Grove Assets.” Second, Defendants withheld notice of Continental’s plans to close Lowry Grove until April 26—a date falling (a) more than two months after the Letter Agreement’s execution and performance, (b) just before Defendants executed the Purchase Agreement and began to perform under the second Inspection Period, and (c) only 48 days before Defendants’ closing such that Defendants would claim they had no ability to engage Aeon’s offer because they were obligated to close the next business day. Third, Defendants wrongly claimed that the residents’ acceptance was deficient because it did not comply with their planned closing date and because they doubted Aeon “had the ability to obtain funding.” Park owners and developers should be disallowed from acting to subvert or circumvent park residents’ effective exercise of the right. E. To Prevent Harm to Lowry Grove Residents and the State, and Deter Future Violations, Defendants Should be Subject to Injunctive Relief Preventing Park Closure (In Addition to Other Remedies) Under § 8.31, Subd. 3a. The remedies available to private claimants under § 8.31 are available to Plaintiffs— against all parties who participated in the transaction. See supra section 1.B. Continental and The Village—which by their July 17 motion do not seek dismissal as parties—are subject to injunctive relief requested by Plaintiffs preventing Defendants from closing the park and displacing residents. Compl. ¶¶ 38-40. Such relief would not affect “marketability of title” because The Village would be free to sell the property without future encumbrance or cloud on title (so long as they followed § 327C.095). The required presence of knowledge and complicity by The Village ensures there would be no uncertainty in title for other purchased property around 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN 20 the State. In accordance with the plain terms and intent of §§ 327C.095 and 8.31, subd. 3a, and to prevent public harms caused by yet another closure, Continental and The Village should be subject to appropriate injunctive relief (in addition to other private remedies). Dated: August 5, 2016 LORI SWANSON Attorney General State of Minnesota /s/ Adam Welle Jason Pleggenkuhle Assistant Attorney General Atty. Reg. No. 0391772 jason.pleggenkuhle@ag.state.mn.us Adam Welle Assistant Attorney General Atty. Reg. No. 0389951 adam.welle@ag.state.mn.us 445 Minnesota Street, Suite 1200 St. Paul, Minnesota 55101-2130 (651) 757-1425 (Voice) (651) 296-1410 (TTY) Attorneys for Amicus Curiae Attorney General of the State of Minnesota 27-CV-16-9809 Filed in Fourth Judicial District Court 8/5/2016 8:53:55 AM Hennepin County, MN September 7th, 2016 Dear Mayor and City Council, I write to you on behalf of our families at Lowry Grove who have organized through the Lowry Grove Resident Association. Under Minnesota Statutes § 327C.095 Subd. 4, the City is required to review the closure statement for Lowry Grove. You should know that the Minnesota Attorney General’s office has closely reviewed the issues involved in the sale and closure of the Park and has submitted the attached amicus curiae brief to the Court arguing that: the seller and buyer in this case violated § 327C.095 by denying residents a meaningful opportunity to exercise their right to purchase and preserve the Park as a manufactured home community and, as a result, should be enjoined from closing the park.1 That being the case, we are appalled at the draft resolution that purports to find that the closure statement “has been reviewed and appears to satisfy the requirements of Minn. Stat. § 327C.095.” The Attorney General’s investigation of the sale and closure of the Park found: • The park owners and developers illegally withheld key terms of the proposed sale from park residents.2 • The park owners and developers colluded to deny residents key benefits of the deal between seller and buyer.3 • The park owners and developers unreasonably refused the residents’ exercise of their statutory right of first refusal.4 • The park owners and developers should not be permitted to engage in concerted action designed to circumvent park residents’ first refusal rights.5 • The park owner should be enjoined from closing the park.6 Instead of blindly adopting findings requested by a developer which has violated the statute and denied residents their right to purchase and preserve the Park and save their homes, the city should closely review the findings of the Attorney General, and stand with and support the rights of its own citizens. The City should accept the Attorney General’s findings and recommendations and reject the Park closure as a violation of state law. At the very least, the City should acknowledge that no finding that the closure statement complies with state law can be made and that therefore the running of the nine months to closure must be held in abeyance until the Court finally decides all of the issues in the pending lawsuit. 1 AG brief, page 1. 2 AG brief page 14 3 AG brief page 15 4 AG brief page 16 5 AG brief page 18 6 AG brief pages 1, 19. In addition, the City is required by § 327C095 subd. 4 to review and evaluate the impact the closure may have on displaced residents. You should know that the sale and the proposed closure of the Park also raise serious disparate impact issues under the federal Fair Housing Act. A resident survey indicates that about 75% of the homes in the Park cannot be moved and will be lost with park closure. The low income residents of these homes face enormous rent increases in the current market – from an average lot rent of $435 to market rents on the order of $900-$1,000. They will all probably have to leave St. Anthony to find affordable housing. Their children will lose the benefit of the city’s great school system. Those whose homes can be moved will also have to leave St. Anthony because of course there are no other manufactured home sites here. A disproportionate number of the households which will lose their homes if the Park closes are Latino residents (about 27% of the homeowners in the park v. about 3% of the residents of St. Anthony and 4.7% of the residents of Ramsey County). Our survey of the park showed that Latino households have larger household sizes compared with white households, and that Latinos and other people of color represent well over half the park’s population. We don’t believe it is in the City’s interest to collaborate with the Fair Housing Act violations of the developer and past owner by adopting a resolution that finds, contrary to the Attorney General’s opinion, and without any actual review of the facts, that the closure statement complies with statutory requirements. Therefore we urge you conclude the closure statement insufficient, and that the public hearing be continued until the resolution of our lawsuit. Stand with us. We are your neighbors. Sincerely, Antonia Alvarez President, Lowry Grove Resident Association Co-Founder, Asamblea de Derechos Civiles