Landlords are subject to numerous regulations, from federal law, to voluminous state statutes, to rules of homeowners’ associations (if applicable), to local municipal ordinances.   Some cities in Minnesota have little to no regulations impacting landlords, while others have robust rental licensing requirements.  But a few cities in the state are going well beyond requiring licensing and are now significantly restricting other aspects of the landlord-tenant relationship.  Specifically, both St. Paul and Minneapolis have recently adopted, and/or are considering, significantly more restrictive local rules limiting the rights of landlords to screen tenants, terminate leases, control rent, and more.

Minneapolis now limits the look-back periods for screening applicant misdemeanors and felonies to 3 years for misdemeanors and 7-10 years for most felonies.  Evictions may only be considered if the tenant was actually evicted within 3 years.  Applicants can no longer be denied based on credit history.  Security deposits are capped at 1 month’s rent.  This is not meant to be an exhaustive list of Minneapolis’ numerous local rules, but those with rental property in Minneapolis should review the full details available on the city’s website and linked ordinances.

St. Paul has a number of new rules which go into effect on March 1, 2021 which go even further than Minneapolis’ rules, including tenant screening guidelines, security deposit limitations, a “just cause” notice policy restricting the ability to terminate leases, and an advance notice policy.  The idea of a “just cause” notice policy is that landlords can’t give a notice to vacate, even when a lease expires, unless they can prove one of the specific “just cause” criteria.  There are more details on their website and linked ordinances.

St. Paul’s new restrictions are currently facing a legal challenge from approximately 20 landlord plaintiffs in a 50-page complaint seeking to challenge the constitutionality of their new restrictions.  More details in this Pioneer Press Article.  Here is an excerpt from the complaint:

Under the Ordinance, an Owner in 2021 is prohibited from making any distinction between Applicant A, who has never committed a crime, has never been evicted, has a high credit score of 800 and an income five (5) times higher than the rent, and Applicant B, who was convicted of first degree pre-meditated murder in 2009, convicted of second-degree manslaughter for a separate killing in 2012, convicted a number of times of running a house of prostitution with the latest conviction in 2016, evicted numerous times with the latest eviction in 2016, and has a low credit score of 425. And, once Applicant B is accepted and begins either not fully paying rent on time and/or causing a nuisance on the premises, the Owner must continue to renew that tenant’s lease at the expiration of the lease period or undergo the expensive and time consuming eviction process if and only if the Owner can establish Just Cause under the Ordinance and the tenant fails to Cure The Deficiency…

The Minneapolis City Council is also considering legislating ”just cause” and pre-eviction filing requirements in line with what St. Paul has adopted.  More information is on the city’s website. 

Minneapolis is further taking steps to add rent control to the ballot in November.  More information is in this KARE11 article and on the city’s website.  The Minneapolis City Council is holding a public hearing on February 24 to discuss their proposed amendments before the Policy & Government Oversight Committee.  Interested parties may sign up to participate.  

While debating the merits of these new regulations goes beyond the scope of this legislative update, it is important for landlords (and prospective landlords) in the Twin Cities to be aware of these new regulations and to modify operating procedures in Minneapolis and St. Paul accordingly, at least for the time being.  It will also be important to monitor the results of these legal challenges, the ongoing legislative debate in Minneapolis, and whether these new rules might influence other cities in the coming years.

If you have questions on these or other business law matters, please feel free to reach out to attorney David Klink or another Bridge Law Group attorney.

BRIDGE LAW GROUP, LTD.
David C. Klink | Attorney at Law
(651) 983-2713
Klink@BridgeAttorneys.com
www.BridgeAttorneys.com
2900 Washington Avenue North
Minneapolis, MN 55411-1630

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