City plans new condo licensing, higher registration fees

Share this:
January 26, 2004 // UPDATED 2:43 pm - April 24, 2007
By: Scott Russell
Scott Russell

Minneapolis will begin licensing rental units in condominiums and townhomes, giving it more leverage to deal with conduct problems, a city licensing official said.

In a related issue, the city proposes registration fee changes for condo and townhome associations and leasehold cooperatives, a plan that has drawn the ire of Downtown City Councilmember Lisa Goodman (7th Ward), who represents a number of condo and townhome owners.

The city historically registered rental units in condo and townhome associations but did

not license them like apartments, said Janine

Atchison, district supervisor with Housing Inspection Services.

The change means the city will inspect condo and townhome rental units and subject them to city licensing codes, she said. For instance, if a rented condo or townhome unit has chronic problems with loud parties or drug-related problems, licensing staff could force the owner to address the problem or lose the license.

"We heard a strong message from condo and townhome associations -- they don't feel like they have a lot of control over rental units within their buildings when there are conduct issues," Atchison said.

The City Council voted 12-0 Dec. 29 to license condo and townhome rentals.

Goodman supports the licensing measure, she said. However, she also opposes registration fee increases.

Registration gives the city the names of responsible parties to contact to fix code violations, such as a fence problem or subpar siding, Atchison said.

City registration fees are $20 a year for condominiums or townhomes of five units or fewer; $35 for buildings with six to 15 units; $50 for buildings with 16 to 50 units and $100 for buildings with more than 50 units.

Councilmember Dan Niziolek (10th Ward), chair of the Public Safety and Regulatory Services Committee, proposes a fee increase of $15 to $25 per category, so the city would charge from $35 to $125, depending on the size of the building.

Atchison said condo and townhome associations have registered with the city since the mid-1970s. According to a city memo, the fees have not been increased since then, and Niziolek said the increases reflected the program's cost.

Goodman said the city can't justify charging any fee for the service -- which she said amounts to typing a few names into a computer -- let alone an increase.

Atchison said between the higher registration fees and new licensing, the city would break even. A new registration fee structure would fix a disparity that has meant townhomes pay more than condos. The city charges by the building, not by the unit, so a 48-unit, eight-building townhome currently pays $280 in registration fees, while a 48-unit, single-building condo pays $50.

The city would now charge by the unit, Atchison said. A 48-unit townhome or condo would pay $75. Condos would pay more than they do now, and townhomes less.

Goodman argues that higher condo charges aren't justified.

"Under state law, as it pertains to fees, there has to be a direct correlation between the fee assessed and the service rendered," she said. "I don't see any additional service rendered here. ... This is about how do you bilk the public for more money."

Atchison referred state law questions to Assistant City Attorney Henry Reimer.

Reimer said city fees have to be roughly proportionate to the cost of regulation.

"It doesn't have to be exact," said Reimer, who did not draft the fee change ordinance. There is no formula or real scientific look at it. It just has to be reasonable."

The Public Safety and Regulatory Services Committee will discuss the issue Feb. 4.