Fundamental fairness suggests that when government forces people out of their homes for redevelopment projects, people ought to be compensated. That was the impetus behind the federal Uniform Relocation Act (URA), and the Minnesota Uniform Relocation Act. In addition, the Minnesota legislature recognized that displacement of this kind is particularly harsh for residents of manufactured home parks, and has enacted a separate law providing nine months notice and modest relocation benefits for park residents when their park is being closed down.
In late 2012/early 2013, Prairie Ridge Hospital in Elbow Lake, Minnesota, decided it wanted to expand. Standing in the way was a small manufactured home park known as Edgetown MH Park. The hospital acquired the park, advised the residents it was closing, and began negotiating move-out payments in the range of $4-5000 per household. Such payments were clearly inadequate to cover the cost of moving these homes or the cost of finding replacement housing of comparable affordability. Negotiating move-outs in exchange for these payments was also illegal.
The distressed residents contacted HPP for help. HPP investigated and discovered that the park acquisition was funded by Rural Development, a division of the US Department of Agriculture. This meant that the federal Uniform Relocation Act applied, with its much more generous relocation benefits. In March, HPP wrote to the Hospital’s lawyer, pointing out that not only was the Hospital violating the state law requiring nine months’ notice to close a MH park, but that the Hospital was inducing residents to move out based on relocation payments that were a fraction of what the residents were entitled to.
The Hospital backed off, delayed the park closing, and eventually agreed to pay HPP’s clients their full URA benefits. This means that in several cases these residents will receive benefits that will truly enable them to adequately relocate. In several cases the benefits per household will exceed $30,000, instead of the $4-5,000 initially offered. HPP is now demanding that the Hospital track down the people they had already induced to move and offer them appropriate compensation as entitled. Finally, HPP is raising this matter with officials at the top of Rural Development in the USDA. One of the most disturbing things HPP learned in its investigation was that officials in RD at a fairly high level seemed to have no knowledge of the agency’s URA obligations.