The Hennepin County Environmental Response Fund grant program expires in January. The change means home buyers in Hennepin and Ramsey counties will no longer need to pay an extra fee when closing on a home.
According to Hennepin County Environmental Services, the grant program has funded approximately $37 million in cleanup for sites since 2011. But, the grant money comes from the mortgage registry and deed tax, which home buyers pay with their purchase. It does not come from a county-wide tax or assessment on everyone living in these counties.
Minnesota Association of REALTORS® Chris Galler recently spoke with KSTP and Twelve TV about the issue. REALTORS® were at the forefront of the push to end the extra fee on home buyers. MNAR supports cleaning up brownfields and creating jobs in Minnesota – but feels that if the counties need the money, they should ask all of their taxpayers to help foot the bill – not just people in the middle of a real estate transaction. “It raises transaction fees. So at the same time that the same government officials will say we need to lower home prices, we need to make housing more affordable, they tack an additional fee on to the transaction which makes it less affordable,” said Galler.
Together, the fees equal 0.02 percent of the price of the home. While that may not seem like a huge price tag – when you’re purchasing a home every dollar counts. And – many homeowners don’t know about the fee until they’re at the closing table signing the documents for their new home. At that point they can’t say no or ask to learn more about what the fee is. That hidden aspect of the fee is another reason REALTORS® are happy it’s going away in January. It’s also important to note that eliminating this fee does not change how much a REALTOR® will make on a transaction – it has nothing to do with commissions. It is simply about protecting homeowners and what happens during a real estate transaction.
The Minnesota Association of REALTORS® is the largest professional trade association in the state with more than 19,000 members who are active in all aspects of the real estate industry in Minnesota.