HB 2356--
Session of 1997
By Representative Haley

AN ACT concerning cities; relating to the rehabilitation of abandoned property; amending K.S.A. 1996 Supp. 12-1750, 12-1752, 12-1753, 12- 1756a, 12-1756b, 12-1756c, 12-1756d, 12-1756e, 12-1756f and 79- 3102 and repealing the existing sections. Be it enacted by the Legislature of the State of Kansas: Section 1. K.S.A. 1996 Supp. 12-1750 is hereby amended to read as follows: 12-1750. As used in this act: (a) ``Structure'' means any building, wall or other structure. (b) ``Enforcing officer'' means the building inspector or other officer designated by ordinance and charged with the administration of the pro- visions of this act. (c) ``Abandoned property'' means any residential real estate for which taxes are delinquent for the preceding two years and which has been unoccupied continuously by persons legally in possession for the preced- ing one year. (d) ``Organization'' means any nonprofit corporation organized under the laws of this state and which has among its purposes the improvement of housing ``Person'' means any individual or corporation organized under the laws of the state of Kansas. (e) ``Rehabilitation'' means the process of improving the property, including, but not limited to, bringing property into compliance with ap- plicable fire, housing and building codes. (f) ``Parties in interest'' means any owner or owners of record, judg- ment creditor, tax purchaser or other party having any legal or equitable title or interest in the property. (g) ``Last known address'' includes the address where the property is located, or the address as listed in the tax records. (h) ``Low or moderate income housing'' means housing for persons and families with incomes within the income limitations prescribed by the department of housing and urban development pursuant to section 8 of the federal housing and community development act of 1937, as amended. Sec. 2. K.S.A. 1996 Supp. 12-1752 is hereby amended to read as follows: 12-1752. (a) Whenever the enforcing officer files with the gov- HB 2356

 1  erning body of the city a statement in writing that any structure, describ-
 2  ing the same and where located, is unsafe or dangerous or is abandoned
 3  property, the governing body, by resolution, shall fix a time and place at
 4  which the owner, the owner's agent, any lienholders of record and any
 5  occupant of such structure may appear and show cause why such structure
 6  should not be condemned and ordered repaired or demolished in the
 7  case of unsafe or dangerous structures or rehabilitated in the case of
 8  abandoned property. Such resolution shall be published once each week
 9  for two consecutive weeks on the same day of each week. At least 30 days
10  shall elapse between the last publication and the date set for the hearing.
11  A copy of the resolution shall be mailed by certified mail within three
12  days after its first publication to each such owner, agent, lienholder and
13  occupant, at the last known address and shall be marked ``deliver to ad-
14  dressee only.''
15    (b)  Cities located in Wyandotte county shall be subject to the follow-
16  ing procedure prior to making any orders concerning abandoned property
17  pursuant to subsection (a).
18    (1)  A governing body shall establish an abandoned property review
19  authority to review and set priorities for the demolition or rehabilitation
20  of abandoned structures. The authority shall consist of at least five mem-
21  bers. One member shall be a licensed architect. One member shall be a
22  city employee. One member shall be the county appraiser or the apprais-
23  er's designee. Other members shall be selected at large, but shall be resi-
24  dents of the city. The authority shall elect a chairperson from among its
25  members and shall meet as frequently as the authority designates.
26    The authority shall cooperate with the enforcing officer to compile a
27  list of abandoned property within the city or which may be deemed dan-
28  gerous or unsafe. The authority shall evaluate the property so identified
29  to determine the suitability of the property for rehabilitation. Property
30  which is structurally sound and or could be rehabilitated for less than the
31  cost of razing the property shall be designated as low-priority property.
32  Property which contains some structural flaws, but which may be suitable
33  for rehabilitation shall be deemed medium-priority property. Property
34  which is dangerous and not suitable for rehabilitation shall be deemed
35  high-priority property.
36    The authority shall develop a list of persons who are interested in re-
37  habilitating abandoned property. Such list shall contain the names and
38  addresses of persons so interested. The governing body of cities subject to
39  this subsection shall provide written notice of low-priority property which
40  may be available for rehabilitation to the individuals listed.
41    (2)  The governing body of the city shall apply the priorities estab-
42  lished by the authority in scheduling properties for demolition. All high-
43  priority properties shall be razed before a governing body may authorize
HB 2356

 1  demolition of medium or low-priority properties unless legal or other ex-
 2  tenuating circumstances significantly delay demolition of all such prop-
 3  erties. All medium-priority property shall be demolished before low-pri-
 4  ority property unless legal or other circumstances significantly delay
 5  demolition of all such properties.
 6    Sec. 3.  K.S.A. 1996 Supp. 12-1753 is hereby amended to read as
 7  follows: 12-1753. On the date fixed for hearing or any adjournment
 8  thereof, the governing body shall hear all evidence submitted by the
 9  owner, the owner's agent, lienholders of record and occupants having an
10  interest in such structure as well as evidence submitted by the enforcing
11  officer filing the statement and shall make findings by resolution. If the
12  governing body of the city finds that such structure is unsafe or dangerous,
13  such resolution shall direct the structure to be repaired or removed and
14  the premises made safe and secure. If the governing body of the city finds
15  that such structure is abandoned property, the governing body may au-
16  thorize the rehabilitation of such property as provided by K.S.A. 1996
17  Supp. 12-1756a, and amendments thereto. The governing body of any city
18  located in Wyandotte county shall not order any property razed if a per-
19  son has submitted a proposal which the authority determines would re-
20  habilitate such property within 18 months at a cost less than the cost of
21  razing and removing of such property. Such resolution shall be published
22  once in the official city paper and a copy mailed to the owners, agents,
23  lienholders of record and occupants in the same manner provided for the
24  notice of hearing. The resolution shall fix a reasonable time within which
25  the repair or removal of such structure shall be commenced and a state-
26  ment that if the owner of such structure fails to commence the repair or
27  removal of such structure within the time stated or fails to diligently
28  prosecute the same until the work is completed, the governing body will
29  cause the structure to be repaired or razed and removed in the case of
30  unsafe or dangerous structures or rehabilitated in the case of abandoned
31  property.
32    Sec. 4.  K.S.A. 1996 Supp. 12-1756a is hereby amended to read as
33  follows: 12-1756a. (a) An organization Any person may file a petition with
34  the district court for an order for temporary possession of property if:
35    (1)  The property has been declared abandoned pursuant to K.S.A.
36  12-1753, and amendments thereto;
37    (2)  the organization person intends to rehabilitate the property and
38  use the property as housing for low and moderate income persons and
39  families; and
40    (3)  the organization person has sent notice to the enforcing officer
41  and the parties in interest of the property, by certified or registered mail,
42  mailed to their last known address and posted on the property at least 30
43  days but not more than 60 days before the date the petition is filed, of
HB 2356

 1  the organization's person's intent to file a petition for possession under
 2  K.S.A. 12-1750 through 12-1756e, and amendments thereto.
 3    (b)  The proceeding shall be commenced by filing a verified petition
 4  in the district court in the county in which the property is located. The
 5  petition shall state that the conditions specified in subsection (a) exist. All
 6  parties in interest of the property shall be named as defendants in the
 7  petition. Summons shall be issued and service shall be made pursuant to
 8  K.S.A. 60-303, and amendments thereto. Service may be made by pub-
 9  lication if the organization petitioner with due diligence is unable to make
10  service of summons upon a defendant pursuant to subsection (a)(3) of
11  K.S.A. 60-307, and amendments thereto.
12    (c)  Any defendant may file as part of such defendant's answer, as an
13  affirmative defense, a plan for the rehabilitation of the property. The
14  court shall grant the defendant 90 days to bring the property into com-
15  pliance with applicable fire, housing and building codes. The court, for
16  good cause shown, may extend the ninety-day compliance period. If the
17  property is brought into such compliance within the ninety-day period or
18  extension of time thereof, the petition shall be dismissed. If the defendant
19  fails to bring the property into such compliance within the ninety-day
20  period or extension of time thereof, or if the defendant's plan is otherwise
21  insufficient, the defendant's affirmative defense shall be stricken.
22    (d)  At the hearing on the organization's petition, the organization
23  petitioner shall submit to the court a plan for the rehabilitation of the
24  property and present evidence that the organization petitioner has ade-
25  quate resources to rehabilitate and thereafter manage the property. For
26  the purpose of developing such a plan, representatives of the organization
27  the petitioner or the petitioner's designees may be permitted entry onto
28  the property by the court at such times and on such terms as the court
29  may deem appropriate.
30    (e)  The court shall make its own determination as to whether the
31  property is in fact abandoned consistent with the terms of K.S.A. 12-1750
32  through 12-1756e, and amendments thereto.
33    (f)  If the court approves the petition, the court shall enter an order
34  approving the rehabilitation plan and granting temporary possession of
35  the property to the organization petitioner. The organization petitioner,
36  subject to court approval, may enter into leases or other agreements in
37  relation to the property. Whether the court approves or denies the peti-
38  tion, the organization petitioner shall provide the governing body a copy
39  of the order within 10 days of the organization's petitioner's receipt or
40  knowledge of such order.
41    Sec. 5.  K.S.A. 1996 Supp. 12-1756b is hereby amended to read as
42  follows: 12-1756b. An organization person which has possession of prop-
43  erty pursuant to K.S.A. 12-1756a, and amendments thereto, shall file an
HB 2356

 1  annual report with the governing body of the city concerning the reha-
 2  bilitation and use of the property. The city shall require reports and status
 3  dates to be filed as it deems appropriate under the circumstances but no
 4  less frequently than once a year. The report shall include statements of
 5  all expenditures made by the organization person including, but not lim-
 6  ited to, payments for the rehabilitation, operation and maintenance of
 7  and repairs to the property, and for real estate taxes, and payments to
 8  mortgagees and lienholders during the preceding year and shall include
 9  statements of all income and receipts from the property for the preceding
10  year.
11    Sec. 6.  K.S.A. 1996 Supp. 12-1756c is hereby amended to read as
12  follows: 12-1756c. The owner of property of which temporary possession
13  has been transferred to an organization any person pursuant to K.S.A.
14  12-1756a, and amendments thereto, shall be entitled to regain possession
15  of the property by petitioning to the district court of the county in which
16  such property is located for restoration of possession and, upon notice to
17  the organization such person for a hearing on such petition. At the hear-
18  ing, the court shall determine proper compensation to the organization
19  such person for its expenditures, including management fees, based on
20  the organization's such person's reports to the court. The court, in deter-
21  mining the proper compensation to the organization person, may consider
22  income or receipts received from the property by the organization person.
23  After the owner pays the compensation to the organization person as
24  determined by the court, the owner shall resume possession of the prop-
25  erty, subject to all existing rental agreements whether written or verbal,
26  entered into by the organization person.
27    Sec. 7.  K.S.A. 1996 Supp. 12-1756d is hereby amended to read as
28  follows: 12-1756d. If property of which temporary possession has been
29  transferred to an organization a person pursuant to K.S.A. 12-1756a, and
30  amendments thereto, is sold for unpaid taxes, an organization a person
31  with temporary possession may redeem the property in the same manner
32  as the owner and amounts paid to redeem the property shall be included
33  as expenditures in the organization's such person's report to the court.
34    Sec. 8.  K.S.A. 1996 Supp. 12-1756e is hereby amended to read as
35  follows: 12-1756e. If an owner of property of which temporary possession
36  has been transferred to an organization a person pursuant to K.S.A. 12-
37  1756a, and amendments thereto, takes no action to regain possession of
38  the property in the five-year period following the granting of temporary
39  possession of the property to the organization, the organization thereto,
40  such person may file a petition for judicial deed and upon due notice to
41  the named defendants and an order may be entered granting a quit-claim
42  judicial deed to the organization such person providing that the property
43  shall be used for low and moderate income housing for at least a 10-year
HB 2356

 1  period after the deed is granted.
 2    Sec. 9.  K.S.A. 1996 Supp. 12-1756f is hereby amended to read as
 3  follows: 12-1756f. The enforcing officer shall maintain a list of all organ-
 4  izations persons who are interested in rehabilitating abandoned property
 5  and who have requested to be included on such list. The organizations
 6  persons on such list shall be given written notice of abandoned property
 7  which may be available for rehabilitation by any such organization. The
 8  enforcing officer may require that requests to be included on such list be
 9  submitted annually to the enforcing officer.
10    Sec. 10.  K.S.A. 1996 Supp. 79-3102 is hereby amended to read as
11  follows: 79-3102. (a) Before any mortgage of real property, or renewal or
12  extension of such a mortgage, is received and filed for record, there shall
13  be paid to the register of deeds of the county in which such property or
14  any part thereof is situated a registration fee of .26% of the principal debt
15  or obligation which is secured by such mortgage. In the event the mort-
16  gage states that an amount less than the entire principal debt or obligation
17  will be secured thereby, the registration fee shall be paid on such lesser
18  amount.
19    (b)  If the governing body of any city has established a housing de-
20  velopment fund pursuant to section 10, prior to registration of any mort-
21  gage of real property in such city, an additional fee of $.04 for each $100
22  and major fraction thereof of the principal debt or obligation which is
23  secured by such mortgage and upon which no prior registration fee has
24  been paid, except as provided in any of the following provisions. The
25  Wyandotte county register of deeds shall deposit all moneys realized from
26  the fee in the city's housing development fund pursuant to section 11.
27    (b) (c)  As used herein, ``principal debt or obligation'' shall not include
28  any finance charges or interest.
29    (c) (d)  In any case where interest has been precomputed, the register
30  of deeds may require the person filing the mortgage to state the amount
31  of the debt or obligation owed before computation of interest.
32    (d) (e)  No registration fee whatsoever shall be paid, collected or re-
33  quired for or on: (1) Any mortgage or other instrument given solely for
34  the purpose of correcting or perfecting a previously recorded mortgage
35  or other instrument; (2) any mortgage or other instrument given for the
36  purpose of providing additional security for the same indebtedness, where
37  the registration fee herein provided for has been paid on the original
38  mortgage or instrument; (3) any mortgage or other instrument upon that
39  portion of the consideration stated in the mortgage tendered for filing
40  which is verified by affidavit to be principal indebtedness covered or in-
41  cluded in a previously recorded mortgage or other instrument with the
42  same lender or their assigns upon which the registration fee herein pro-
43  vided for has been paid; (4) any lien, indenture, mortgage, bond or other
HB 2356

 1  instrument or encumbrance nor for the note or other promise to pay
 2  thereby secured, all as may be assigned, continued, transferred, reissued
 3  or otherwise changed by reason of, incident to or having to do with the
 4  migration to this state of any corporation, by merger or consolidation with
 5  a domestic corporation as survivor, or by other means, where the original
 6  secured transaction, for which the registration fee has once been paid, is
 7  thereby continued or otherwise acknowledged or validated; (5) any mort-
 8  gage or other instrument given in the form of an affidavit of equitable
 9  interest solely for the purpose of providing notification by the purchaser
10  of real property of the purchaser's interest therein; (6) any mortgage in
11  which a certified development corporation certified by the United States
12  small business administration participates pursuant to its community ec-
13  onomic development program; (7) any mortgage or other instrument
14  given for the sole purpose of changing the trustee; or (8) any mortgage
15  for which the registration fee is otherwise not required by law.
16    (e) (f)  The register of deeds shall receive no additional fees or salary
17  by reason of the receipt of fees as herein provided. After the payment of
18  the registration fees as aforesaid the mortgage and the note thereby se-
19  cured shall not otherwise be taxable.
20    New Sec. 11.  (a) Any city, by adoption of an ordinance, may create
21  a housing development fund to assist persons seeking to rehabilitate aban-
22  doned property. Such assistance may take the form of grants or loans, but
23  shall be provided only to individuals who have taken possession of such
24  property pursuant to K.S.A. 12-1750 et seq., and amendments thereto.
25  Moneys may be budgeted and transferred to such fund from any source
26  which may be lawfully utilized for such purposes.
27    (b)  Moneys credited to such fund from annually budgeted transfers
28  shall not thereafter be subject to the provisions of K.S.A. 79-2925 through
29  79-2937 and amendments thereto. In making the budget of the city, the
30  amounts credited to, and the amount on hand in, such housing devel-
31  opment fund and the amount expended therefrom shall be shown thereon
32  for the information of taxpayers. Moneys in such fund may be invested
33  in accordance with K.S.A. 10-131 and amendments thereto with the in-
34  terest credited to the fund.
35    Sec. 12.  K.S.A. 1996 Supp. 12-1750, 12-1752, 12-1753, 12-1756a, 12-
36  1756b, 12-1756c, 12-1756d, 12-1756e, 12-1756f and 79-3102 are hereby
37  repealed.
38    Sec. 13.  This act shall take effect and be in force from and after its
39  publication in the statute book.