by Victoria Heldt
City of Brainerd v. Brainerd Investment Partnership
(Minnesota Court of Appeals, April 2, 2012)
In this case, the Court consolidated two related appeals into one opinion. Both appeals involved the City of Brainerd’s attempt to widen a road and to pay for the project with a special assessment tax. College Drive (a two-lane road) had become a heavily traveled route for regional traffic, so the City sought to reconstruct a portion of it into a four-lane road. Under chapter 429 of Minnesota statute, there are two methods through which a resolution such as this could be passed. If at least 35% of the property owners adjacent to the road submit a petition in favor of the project, it would require a simple majority vote of the city council to be passed. If no such petition is filed, the project would require a four-fifths majority vote of the city council to be passed.
Central Lakes College (CLC) owns more than 35% of the property adjacent to the road; however, since it is an “instrumentality of the State of Minnesota,” it cannot be required to pay any special assessments levied on the property. Jeff Hulsether (Brainerd’s City Engineer) sent a letter to Kari Christiansen (CLC Vice President of Administrative Services) inquiring if CLC would be willing to pay a portion of the special assessments. In December 2009, CLC sent a letter stating that it “intended” to pay the special assessments pending budgetary issues. After reviewing a feasibility report in September 2010, CLC sent a memo to the City confirming that it would pay the assessments. Subsequently, CLC filed with the city council a petition in favor of the project. The city council approved the road project by a 4-3 vote.
Brainerd Investment and the Andas appealed, arguing that CLC should not be considered an “owner” of property adjacent to the road project because CLC cannot be subject to special assessments, and that under chapter 249 of Minnesota Statutes, property that is not subject to special assessment cannot be included in the 35% ownership test. As a result, it was argued, the project needed a four-fifths affirmative vote of the council, not a simple majority vote, to pass.
In January 2011, the City commenced an eminent-domain proceeding in order to get temporary construction easements and permanent utility easements for the property. Anda challenged the proceeding on the grounds that the City’s failure to comply with Minnesota statute 429 regarding the 35% rule precluded it from taking the property. Subsequently, the City and the CLC created an official agreement stating CLC will pay the special assessment. The district court ruled in favor of the City in both cases.
The Court identified two issues at hand. The first was whether the CLC, as an instrumentality of the State of Minnesota, is considered an owner under statute and can therefore be included when using the 35% ownership test. The second issue was whether a condemnation petition can be authorized if the assessment process is defective under chapter 429.
In regards to the first argument, appellants cited three attorney general opinions in which the state has been determined not to be an owner under special assessment statutes. Furthermore, the appellants noted that when the legislature amended chapter 429 in the 1950’s, it relied heavily on the language in one of those opinions. The Court dismissed the use of the attorney general opinions to support appellants’ arguments, stating that the opinions conflict with the plain language of chapter 429. The statue allows “owners” of the adjacent properties to petition. The common definition of an owner is “one who has the right to possess, use, and convey something.” The CLC clearly fits that description, and should be included as an “owner.” Appellants further argued that public policy supports their argument because the state has the ability to petition private property owners for additional support. Appellants further noted that the state (or the CLC) could decline to pay the assessment. The Court responded that according to the record, the CLC has every intention of helping pay for the project. It concluded that the district court did not err when it deemed CLC’s petition valid. Since CLC’s petition was indeed valid, the Court did not consider the condemnation issue. The district court’s decision was affirmed.