The National Self Storage Association is well-known in the self storage industry for providing educational resources, conferences & trade shows, as well as legal guidance. However, the primary purpose of the SSA is to advocate for self storage operators in the United States. Headquartered close to Washington D.C., the association is a registered lobbying entity that takes actions to influence laws affecting self storage operators. They team up with the state associations to help get lien laws updated and fight against laws harmful to self storage operations.
The SSA and individual state associations have been very busy advocating for the industry in 2021. With legislative efforts currently in motion in 27 states all at various legislative process levels, it can be challenging to keep up with the progress and results of each proposition or bill. With the risks associated with a wrongful lien sale, it is also critical to understand what efforts are in place and how they will impact your self storage business.
As your partner in success, it has long been our aim at OpenTech to help you interpret and adhere to self storage lien laws. With the addition of our Auction Review Service, ARS, we made it official: we are committed to supporting our clients and all self storage industry operators by keeping a direct pulse on the lien laws around the country. We have a dedicated ARS team, led by professional, veteran self storage auctioneers, who undergo training to know and understand self storage lien laws. This team requires ongoing education, including following legislative updates to make sure our clients know when changes are happening, and how they might impact your operation. See below for upcoming changes that might apply to you.
House Bill 1027 was signed into law by Governor Hutchinson on March 15, 2021, and is now known as Act 363. It is scheduled to go into law 90 days after the legislative session ends on April 30, 2021. The law now explicitly states a storage auction can be held online and defines an “Independent Bidder” to help operators know and prove their lien sale was commercially reasonable.
The bill also removes the newspaper advertising requirement by allowing operators to advertise in any commercially reasonable manner, resulting in at least three independent bidders. This provision means storage operators can use their unit listing on StorageTreasures as their legal ad. Please note that the auction listing must be visible on StorageTreasures for a full seven days before the sale’s close.
Operators can find reports of when units were posted and how long they were posted in their account reports. Additionally, StorageTreasures has a Commercially Reasonable Auction Assurance feature that tracks independent bidders viewing your auction listing. If the listing did not have at least three independent bidders, the sale would be canceled, and you would be notified.
Link to bill — https://legiscan.com/AR/text/HB1027/2021
Senate Bill 201 affects several Utah statutes related to legal notices and the use of a newspaper of general circulation. While the bill was not directed entirely at self storage, it provides excellent relief for storage operators from costly newspaper ads.
Governor Cox signed the bill on March 17, and it will go into effect on May 4, 2021. Under the new law, operators do not have to advertise in a newspaper if they can prove delivery of the Notice of Sale via email or with a Certified Mail receipt.
An advertisement is still required even if the above conditions are met. However, after completing the requirements, the operator may choose how they feel best to advertise the sale. The operator can use their StorageTreasures listing as their advertisement, but a few conditions must be met. The listing must include the following items:
- The address of the self storage facility
- The unit number
- The tenant’s name
- The time, place, and manner of sale
The ad or listing must be visible on StorageTreasures for at least 15 days before the sale if you choose this option to advertise.
Link to bill — https://le.utah.gov/~2021/bills/static/SB0201.html
3. North Dakota
Senate Bill 2330 was signed into law by Governor Burgum on March 23, 2021. The bill revises several parts of the self storage statute, beginning with modifying the definition of “default” and “storage space” to give operators more clarity and protection. What will probably excite operators in North Dakota more is the addition of email and verified mail as legal means of sending your tenant the notice of sale form. This means you no longer need to use Certified Mail.
Verified mail is defined as any mail or personal delivery service which includes proof of mailing. One of the most popular verified mail methods is to use first-class mail with A Certificate of Mailing. This method is significantly cheaper than Certified Mail at approximately $1.60 per letter. Go to your local post office to get more information about using the Certificate of Mailing.
SB 2330 also removed the requirement to advertise your sale in a newspaper of general circulation. You can now advertise in any commercially reasonable manner resulting in at least three independent bidders. Because of this, like Arkansas, your StorageTreasures unit listing would count as a legal way to run your ad. Your listing on StorageTreasures will need to be active and visible for at least seven full days before the sale.
Link to the bill — https://www.legis.nd.gov/assembly/67-2021/documents/21-1018-03000.pdf
House Bill 98 was signed into law on March 25, 2021. The bill which removes the newspaper requirement will go into effect on June 28, 2021. The bill says “at least three days before the sale, advertise the time, place, and terms of the sale in a newspaper of general circulation in the jurisdiction where the sale is to be held or posted on a publicly accessible website that advertises self-storage lien sales or public notices.”
There are no additional requirements for the legal ad such as the tenant’s name or unit number. Operators in Kentucky would be able to use their StorageTreasures listing as their advertisement since StorageTreasures regularly advertises self storage lien sales. The unit will need to be visible on the website for three (3) full days. There are reports available in every users’ account showing when auctions were posted and how long they were posted. These reports can be accessed at any time.
Link to the bill — https://apps.legislature.ky.gov/recorddocuments/bill/21RS/hb98/orig_bill.pdf
Stay tuned to our blog for future updates about self storage lien laws.
Author: Cheli Rosa
This blog post was authored by licensed auctioneer Cheli Rosa. Cheli an Auctioneer and Marketing & Communications Manager for StorageTreasures, managed by OpenTech Alliance. She helps clients at StorageTreasures have successful auctions and increase debt recovery percentages. Cheli regularly speaks at national and state self storage association events and contributes to many industry publications. She served on the Board of the Florida Self Storage Association and has been in the self storage industry for nine years. She was formerly the Director of Marketing at StorageStuff.Bid Online Storage Auctions and the Social Media Manager for Sentry Self Storage Management. Her passion is helping clients figure out what they need before they know it themselves. She is a Mom, an avid reader, and a Pinterest addict.