June 17, 2014 at 12:00 am
Now that the second regular session of Maine’s 126th Legislature has concluded, we wanted to call your attention to some of the upcoming legal changes that could affect the business of commercial real estate developers and associated service providers. We have called out three new laws that are of particular interest:
- LD 1389, An Act to Expedite the Foreclosure Process – Public Law 2013, chapter 521
This new law creates an expedited process for the foreclosure of vacant and abandoned property in uncontested cases. Upon proof of abandonment by clear and convincing evidence in an uncontested case, a court may now declare a property abandoned and advance the foreclosure on its docket. The redemption period has been shortened from 90 to 45 days. This change may make it easier for real estate developers to acquire foreclosed properties, and should ease the burden on commercial lenders by providing a shorter time horizon for the re-sale of a foreclosed property.
The new law assigns a plaintiff certain duties upon entry of an order of abandonment, including a duty to assume the duties of a landlord if the premises include dwelling units and to notify the municipality in which the premises is located. If a court has determined that a property has been abandoned, the foreclosure sale of that property may be adjourned only once and for not more than seven days absent an order of the court. The Act also amends Title 14 to clarify the standards of foreclosure mediation.
Additionally, the Act amends the real estate transfer tax law to ensure that the transfer tax is paid on property when there is a foreclosure sale whether the property is transferred by deed, assignment or otherwise. Finally, the Act clarifies the obligations of property preservation companies that act on behalf of mortgage servicers to take possession of homes and authorizes their regulation by the Department of Professional and Financial Regulation, Bureau of Consumer Credit Protection.
- LD 1043, An Act to Improve the Regional Economic Development Revolving Loan Program – Public Law 2013, chapter 605.
This law amends an existing law regarding the Regional Economic Development Revolving Loan Program of the Finance Authority of Maine (FAME). The amended law expands the purposes of the loan program to include revitalization of downtowns and building stronger communities and a sustainable economy. Further, entities that participate in the program as lenders are now permitted to use revenue from commitment fees and interest to cover operating costs, including loan fund management. Additional program changes include allowing different types of businesses, mixed-use facilities, and others to participate, increasing the size of the companies that can participate, and increasing the loan amount for corporations and for qualified childcare projects. The effective date of the Act, however, is contingent upon the Legislature appropriating or allocating funds of at least $1 million to FAME for the purposes of the Act.
- LD 1755, An Act To Amend the Mandatory Shoreland Zoning Laws To Exclude Subsurface Waste Water Disposal Systems, Geothermal Heat Exchange Wells and Wells or Water Wells from the Definition of "Structure" – Public Law 2013, chapter 489.
This law amends the definition of “structure,” as that term is defined in the state’s shoreland zoning laws, to exclude subsurface wastewater disposal systems, geothermal heat exchange wells, and water wells. The primary effect is that these features will not be subject to restrictive setbacks within the shoreland zone. This change may impact developers or businesses who are seeking to acquire or operate on property in the shoreland zone.
For additional details on the select laws noted above, or to access the complete version of Pierce Atwood’s 2014 Summary of New Maine Laws, please click here. If you have questions about how these or other newly enacted laws may affect your business, please do not hesitate to contact John Formella (207-791-1100 or email@example.com), or Brian Rayback (207.791.1188 or firstname.lastname@example.org).
Categories: Maine Real Estate Insider