House Bill 13-99, which removes statutory language authorizing the Commissioner of State Lands to donate tax-delinquent parcels for urban homestead purposes, passed the Senate committee on a voice vote after extended questioning from senators and explanation by the bill sponsor and the deputy commissioner of state lands.

Sponsor Senator Gary Stubblefield introduced the measure as a repeal of the state's urban homestead donation-deed language. He said the change responds to the U.S. Supreme Court decision in Tyler v. Hennepin County and to an Attorney General opinion finding that donation deeds could violate the Fifth Amendment's takings clause by depriving an owner of the opportunity to recover excess proceeds. "This bill would just remove the language," Stubblefield said.

The bill's nut graf: supporters said the repeal would eliminate a statutory avenue that could expose the state to constitutional challenge by preventing the Commissioner of State Lands from donating property free and clear when there might be recoverable excess proceeds for the original owner.

Deputy Commissioner Kelly Boyd of State Lands explained the agency's current practice and the legal distinction at issue. Boyd said certified tax-delinquent parcels are first offered at live auction; if unsold they remain on inventory for two years and then become negotiable with a $100 starting bid. If a parcel sells for more than taxes and fees, the surplus (excess proceeds) is available for the prior owner to claim. "What happened in Tyler v. Hennepin County is that the state just took the money. They didn't give the owner an opportunity to get the excess proceeds," Boyd said, and the Attorney General's opinion echoed that concern.

Senators asked whether the agency had stopped the donation practice after the court decision and whether donations are commonly used. Boyd told senators the Commissioner ceased donations after the decision and that donation deeds were infrequent: "The deed we're talking about in this bill, we've done 30 of. The donation deed ... we've done 22." He also described the sales timeline and the online bidding process that preserves an owner's opportunity to obtain excess proceeds if a sale produces one.

Several senators pressed for narrower fixes rather than full repeal. Senator Blake Peyton suggested limiting the restriction to a two-year period after auction so the commissioner could still donate property that, after extended marketing, was unlikely to produce excess proceeds. Senator Peyton said he worried the repeal might be broader than necessary for the constitutional issue. Boyd and Stubblefield replied the AG opinion and the court decision turned on the removal of any owner's opportunity to recoup excess proceeds and that the agency had already stopped donations.

Senators concluded without public comment. A motion to pass the bill was made by Senator Peyton, seconded by Senator Sullivan, and the committee approved the measure by voice vote.

The committee also took up House Bill 11-21, which staff said accomplishes similar changes regarding donation deeds in the tax-forfeiture process; that measure was also passed by the committee.