AN ACT to amend and reenact section 40-11-04.2 of the North Dakota Century Code, relating to the transfer of real property by exclusive and nonexclusive listing agreements.
Summary
HB 1401 amends North Dakota law governing how cities may sell municipal real property through real estate brokers. The bill updates section 40-11-04.2 to allow a city, by resolution, to identify property for sale, set a maximum fee/commission rate, and reserve the right to reject any insufficient offers. After publishing the resolution on the city website for at least 14 days, if the city has a website, the city may use licensed brokers under either nonexclusive listing agreements or an exclusive listing agreement chosen through a competitive process.
For exclusive listings, the bill requires broker proposals to be evaluated based on the broker’s experience, experience with similar property, marketing strategy, and proposed fee or commission. It also clarifies that when a city negotiates a purchase agreement with a buyer represented by a broker, the city may agree to pay the buyer’s broker compensation, and that the city must consider the financial impact of doing so when negotiating listing agreements.
Impact
The bill narrows and clarifies the procedures cities must follow when disposing of municipal real property through brokers, affecting local government real estate transactions and the terms of broker compensation. It amends North Dakota Century Code section 40-11-04.2 to expressly authorize exclusive listing agreements selected through a competitive process, while preserving nonexclusive listings and adding factors for evaluating broker proposals. It also gives cities explicit authority to pay buyer-broker compensation and requires consideration of that cost in the city’s overall fee structure.
Sentiment
The bill appears to have been broadly supported and noncontroversial. It passed the House 89-0 and the Senate 44-0, indicating unanimous approval in both chambers. The lack of recorded committee transcript discussion suggests there was little public or legislative dispute over the measure.
Contention
No notable opposition is reflected in the available record. The main policy issue embedded in the bill is how cities should manage broker selection and compensation when selling public property, including whether to use exclusive listings and how to account for buyer-broker fees. Any potential concern would likely center on municipal discretion, transparency in broker selection, and the fiscal impact of broker commissions, but no specific dissenting viewpoints are documented.