A May 25, 2023, U.S. Supreme decision in Tyler vs. Hennepin County has struck down provisions of Minnesota’s property tax forfeiture law with a unanimous opinion that they are in violation of the “takings clause” of the Constitution’s Fifth Amendment. According to Minnesota Forest Resources Council (MFRC) Chair Pete Aube, MFRC is concerned about how new tax forfeiture bills being introduced in the state legislature to fix the problem might also unnecessarily impact 2.8 million acres of previously forfeited forest lands now under the sustainable management and stewardship of Minnesota County governments.

 

Tyler vs. Hennepin County concerns a Minneapolis condo that the owner forfeited to Hennepin County in exchange for $15,000 of unpaid back taxes, penalties, and fines. After seizing the condo, the county sold it for $40,000 and kept the $25,000 that was in excess of Tyler’s tax debt, thus triggering the Court’s determination that a violation of the “takings clause” had occurred.  Now, Minnesota and 19 other states with similar tax forfeiture procedures, must review and amend their individual state statutes to bring them into compliance with the decision of the Court.  Presumably, this may include systems to avoid “takings” violations and potentially even a means to compensate some previous owners of tax forfeited property. 

 

According to MFRC, tax forfeiture forest lands represent approximately 15% of Minnesota’s total forest acreage.  Most of the property was acquired by counties via tax forfeiture over the course of more than a century.  Many of the properties were cut over timber land or were forfeited during the Great Depression.  These lands have long since been reforested and in some cases improved upon with capital investments.  In addition to serving as habitat for fish and wildlife, protecting water quality, and providing recreational access to hunters, fishermen, snowmobilers, and other outdoor enthusiasts; these sustainably managed forest lands provide counties and local schools with revenue from sustainable timber harvest.

 

MFRC is developing a resolution for the Minnesota Legislature to consider when taking the tax forfeiture issue up in their next legislative session. The resolution will likely provide background information and recommendations supporting the retention and continued sustainable management of County Forest lands.