The owners of the Broadmoor Valley mobile home park in Marshall have filed an answer to a lawsuit from the Minnesota Housing Finance Agency.

In documents filed in Ramsey County District Court on April 17, attorneys for Schierholz & Associates ask the court to rescind the agreement for a $500,000 grant the Broadmoor Valley owners were awarded in 2022.

The Minnesota Housing Finance Agency sued Schierholz & Associates earlier this year, alleging that the Broadmoor Valley owners broke the conditions of its grant agreement by announcing plans to close the mobile home park. Minnesota Housing’s complaint also alleged that Schierholz & Associates raised rents at the park by more than 5%, without prior approval from Minnesota Housing.

The conditions of the grant agreement included that Broadmoor Valley continue to operate as a manufactured home community for 25 years, and that they keep housing affordable by limiting rent increases.

However, in counterclaims filed this month, attorneys for Schierholz & Associates alleged that Minnesota Housing violated Schierholz’s constitutional rights by taking the use of the property. The $500,000 grant was not enough to fully fund infrastructure improvements at Broadmoor Valley, the counterclaims said. Schierholz & Associates applied for additional grant funds in 2022 and 2023, but was denied both times. The counterclaims alleged that the Minnesota Attorney General’s Office asked Minnesota Housing to deny the grant applications.

At the same time, Broadmoor Valley could not be sold, and the owners could not collect enough rent to fund the needed infrastructure improvements, the counterclaims alleged.

The counterclaims allege that Minnesota Housing acted in bad faith, and that they violated Schierholz’s rights under both the U.S. and Minnesota state constitutions.

Schierholz & Associates are asking for the court to rescind the grant agreement and the restrictive covenants on Broadmoor Valley. They are also seeking damages, and compensation for the loss of the use of the Broadmoor Valley property.

Broadmoor Valley closure

meeting is next week

At the same time the Minnesota Housing lawsuit is going on, Schierholz & Associates have announced they plan to close down Broadmoor Valley by March 1, 2026. The city of Marshall will be holding a public hearing on the closure on May 7.

The hearing will be at 5:30 p.m. at the Marshall Middle School auditorium.

Under Minnesota laws, the owners of a manufactured home park have to give 12 months’ notice before closing the park. State laws also require the city to hold a public hearing, which will be a chance for park residents to say how they will be affected by the closure. Displaced residents could be eligible for money for relocation costs from Minnesota’s manufactured home relocation trust fund.

At the hearing, the city will also need to appoint a neutral third party to act as an arbitrator for relocation fund payments, state statutes say.

Before the meeting, Schierholz & Associates president Paul Schierholz said he is calling on Broadmoor Valley residents to support him and his company at the public hearing. On Monday, Schierholz provided the Independent with copies of a letter, in English and Spanish, that he said were sent to residents.

The letter claimed that board members of the Broadmoor Valley resident association were involved in a “dubious scheme” with the Attorney General’s Office, to force the sale of Broadmoor Valley to a cooperative. Schierholz’s letter said this “gave false hope to the residents of Broadmoor Valley.”

“Six valuable years and tons of money have been wasted. Despite the interference, if allowed, I can execute a beautiful redevelopment plan that would win approval from the residents of Broadmoor Valley, the residents of Marshall, the city of Marshall, and the state of Minnesota,” the letter said.

“It would be helpful if the residents of Broadmoor Valley and the Board members united behind my company and myself. Being part of the solution instead of part of the problem would facilitate the execution of this plan. The board members would be wise to share with me their conversations and correspondence with the other parties involved.”

In the letter, Schierholz said he wanted to keep Broadmoor Valley open, and he planned to give a presentation at the May 7 hearing.

“Many residents showing up and supporting us will help keep the community open and prosperous. You have nothing to lose but a lot to gain,” the letter said.