Back to the Mar-Apr 2022 issue

Can Cities Recoup Charges From Properties in Foreclosure?


Q: We sometimes have a situation where a property goes into foreclosure with unpaid utility charges. Can the city recoup those unpaid charges?

Paid or unpaid billsLMC: Yes. The best way for a city water and sewer utility to recoup unpaid charges from properties in foreclosure is to certify unpaid charges as soon and as often as possible. The local ordinance must articulate certification procedures. While county auditors may only “spread” the unpaid water and sewer charges once a year “to be collected as other taxes are collected,” cities may certify the charges at multiple times throughout the year. Once unpaid water and sewer charges are certified to the county, they are a valid lien against the property. When a foreclosed property is eventually sold, the unpaid charges must be paid.

During foreclosure proceedings, the defaulting owner of the property is responsible for utility charges (not the bank or mortgage holder). In rental situations, where a building with tenants enters foreclosure proceedings, utilities must be paid in accordance with the lease agreement between the tenant and the property owner. For more information, see the LMC information memo at

Answered by Research Manager Amber Eisenschenk:

Human Resources

Q: Our city is looking for new ways to attract and retain employees, and we are considering implementing employee incentive pay. Does state law allow cities to do that?

job seeker with a job offerLMC: Minnesota cities have the power to prescribe the compensation and employment conditions for employees. However, the Minnesota Constitution also requires that all public funds be expended for a public purpose authorized by statute.

As cities struggle to find new ways to attract and retain employees, some are looking at hiring incentives (one-time lump sum payment for a new hire) or referral incentives (payment to current employees who help the city find a new employee).

While cities are generally prohibited from awarding retroactive bonus pay, there may be ways for a city to structure other types of incentive pay. In general, the city should take the following measures when establishing incentive programs:

  • Work closely with the city attorney.
  • Establish specific criteria or goals in advance that must be met to receive the incentive pay.
  • Have the city council approve the pay incentives as a formal part of the employee compensation plan.
  • Document that employees know about the incentive pay and know how they can earn it.

For more information about employee compensation and incentive plans, see chapter 4 of the League’s HR Reference Manual at

Answered by Human Resources Director Laura Kushner:


Q: What are the legal requirements for the daily attire and personal protective equipment for public works staff?

Two construction workers deciding where to grab a coffeeLMC: The federal Occupational Safety and Health Administration (OSHA) and state statutes require that employees wear high-visibility personal protective equipment (PPE) when working around moving motor vehicles. This would include staff who are doing road work in the public right of way, lawn mower operators who are driving mowers in the roadway or right of way, and anyone else who works around moving traffic. Some cities issue high-visibility vests, and others have issued apparel such as high-visibility T-shirts, sweatshirts, and/or coats. (See Minnesota Administrative Rules, part 5207.0100.)

OSHA also requires employees to wear specific foot protection if they are subject to foot injuries from falling, rolling objects, or objects that could pierce the sole. Public works staff might do some jobs that require protective footwear and some jobs that don’t. This may require a change of shoes. For example, an employee may wear sneakers while mowing grass. If while mowing, they get called to check a sewer problem and they need to open a manhole, they should change their shoes first. (See OSHA Standard Number 1910.136.)

When it comes to daily attire, that’s a local decision. Cities should review the job description and develop a uniform policy to fit those needs, keeping safety in mind.

Answered by Loss Control Consultant Troy Walsh: