Several years ago, a change was made to the Minneapolis tiered rental license model. This is a system by which the city ranks each rental property based upon a number of criteria to place it in a tier. Tier 1 properties generally require very little city intervention and are well maintained while tier 3 rental properties are considered to need excessive city services and are often poor maintained.
So, why does this matter to me as a Minneapolis landlord? The tiering system increases rental license costs and increases the frequency of Minneapolis rental license inspections (which can increase costs of repairs).
| Tier | Inspection Cycle | Rental License Renewal Fee |
| 1 | 8 Years | $70 |
| 2 | 5 Years | $112 |
| 3 | 1 Year | $373 |
The system is built around a comprehensive set of criteria based upon how much city time and resources a rental property consumes. While complex, it is actually a fair and reasonably designed system. Click here to see the Minneapolis rental license tier criteria.
Point values are assigned for different type of issues at the property. Once you accumulate a level of points across a 2 year rolling period, you are immediately put in the next tier. Here are the tier point levels
| Tier | 1-3 Unit Buildings | 4+ Unit Buildings, Condos, Mixed Use |
| 1 | 0-30 | 0-15 |
| 2 | 31-64 | 16-34 |
| 3 | 65+ | 35+ |
As you can see, larger buildings are only allowed to accumulate about 1/2 as many points as a single family home. Plus, points are assigned to multi-unit buildings just for having multiple units (for example, a 4 plex in Minneapolis starts with 3 points each year), with the thought that multi-unit building will by their nature consume more city resources.
Here is an example of violations or items that can add points:
- Up to 3 Solid waste warning letters=5 points
- Up to 6 housing code violations=10 points
- 1 Disorderly conduct of tenants or guests=15 points
So, 4 solid waste letters and 1 disorderly conduct will very quickly put you into tier 2 with a multi-unit building.
As I mentioned above, the criteria seems more than reasonable. My wish was that this information was available online. Unfortunately, Rental Management Guys has taken over some apartment buildings in Minneapolis that are tier 3. It would be nice to quickly identify what cause them to hit tier 3 so we can put a plan together to get the build under control (or know that the cause may have been from 2 years ago and was resolved previously).
In summary, be aware than any notice, interaction or letter from the city can add up to put you in a different Minneapolis rental license tier which in turn will cost you more money each year and increase the frequencies of your inspections.
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