Minnesota Appeals Court rules against impact fees for road construction

by Eric Christianson

Harstad v. City of Woodbury
(Minnesota Court of Appeals, September 18, 2017)

The City of Woodbury, Minnesota is a growing suburb of Saint Paul. To reduce the public burden of road construction to new subdivisions, the city passed an ordinance in 2016 which provides that the city may not approve a proposed subdivision if it is deemed “premature.” The city may deem a subdivision “premature” if streets “to serve the proposed subdivision” are not “available,” which is defined as streets “existing or readily extended and funded” as “consistent with the phasing in the comprehensive plan.”

However the city provides that a new development without existing road infrastructure may be deemed mature if the developer is willing to “pays its own way” and “all associated costs” for “public infrastructure” will “be the sole responsibility of the developing property owner.” To determine these associated costs, the city has allocated undeveloped land into three phases, each of which has an estimated associated cost per acre associated for “increased traffic and trips that are generated” by expected development in that area. This fee is referred to as a “major roadway assessment” or MRA and is used as the starting point for a negotiated agreement with developers.

Martin Harstad, of Harstad Hills Inc., submitted an application to to develop 77 acres of phase – two land into a 183 – home residential community called “Bailey Park on July 23, 2015. The city informed Harstad about certain deficiencies in the application. Harstad remedied the majority of them and was then informed by the city that the remaining deficiencies where relatively unimportant. This is significant because once the city receives a complete application under Minnesota law, if it does not deny that application with cause, it is automatically approved. After receiving the cost estimate from the city for the major roadway assessment, Harstad challenged the ability of the city to collect this fee in court. He also made a takings claim, arguing that the city had deprived him of use of his property without compensation. Finally he claimed that his application had already been approved as the statutory period that the city had to deny the claim had elapsed.

The district court found for the city on the latter two claims. The permit was not entirely complete, therefor the statutory period had never begun. The court also found that Harstads takings claims were immature as the permit had never been fully submitted nor had the fee been collected. The court did however find that the city had no power to collect fees to pay for road infrastructure.

The City of Woodbury appealed this decision to the Minnesota Court of Appeals.

The Minnesota Court of Appeals focused its analysis on the question of the power of Woodbury to collect a “major roadway assessment.” The City of Woodbury is a statutory city; thus, it “has no inherent powers beyond those expressly conferred by statute or implied as necessary in aid of those powers which have been expressly conferred.”

The city argues it has express authority to impose the MRA under the plain language of Minn. Stat. § 462.358, subd. 2a . Section 462.358, subdivision 1a, provides that “a municipality may by ordinance” regulate the subdivision of land to , among other things, facilitate “adequate provision for transportation.” Minn. Stat. § 462.35 8, subd. 1a . Subdivision 2a states , in relevant part:

The standards and requirements in the regulations [authorized by subdivision 1a] may address without limitation : the size, location, grading, and improvement of lots, structures, public areas, streets, [and] roads . . . . The regulations may prohibit the issuance of permits or approvals for any tracts, lots, or parcels for which required subdivision approval has not been obtained.

The regulations may permit the municipality to condition its approval on the construction and installation of sewers, streets , electric, gas, drainage, and water facilities, and similar utilities and improvements or, in lieu thereof, on the receipt by the municipality of a cash deposit.

The city maintains that subdivision 2a’s “open-ended language” unambiguously authorizes it to condition subdivision approval on a developer’s agreement to pay an MRA that funds necessary road improvements “without limitation on location.”

The Court disagrees. This section only authorizes city planning not the collection of a fee to cover road construction costs. The Court pointed out the legislature has explicitly authorized municipalities to assess water and sewer connection charges against developers to fund public water and sewer improvements made necessary by development. The legislature has never made similar provisions for roadways.

The court agreed with the district court finding that although the city had communicated with Harstad that the remaining deficiencies in his application were minimal, the fact that they were never corrected meant that the statutory period in which the city had to approve or deny the application never began.

Finally the court affirmed the district courts denial of Harstad’s taking claim. The permit has not yet been denied nor has the major roadway assessment been collected, so no taking could have occurred.

The City of Woodbury has appealed to the Minnesota Supreme Court which accepted to hear the case. A date for oral argument has not been set.

Diesel repair business met all criteria for conditional use permit in agricultural zone

Hortian, et al., Relators vs Fischer and Wright County Planning Commission
Minnesota Court of Appeals, December 7, 2015

In 2006 the Wright County Planning Commission granted a CUP to Fischer to operate a diesel repair business as a home-extended business on property that is zoned General Agricultural (AG). Under this zoning classification home-extended businesses are allowed. The Hortians live on the neighboring property and complained about the business multiple times over multiple years. The Wright County Sheriff’s Department inspected the property and noted multiple violations. Fischer was told to file for an amended CUP, which he did. Fischer estimated that 40% of his business was agricultural and that his activities on the property still complied with the zoning classification. Realtors testified that Fischer’s business injured his neighbor’s properties. The Commission granted the amended CUP.

The Hortians appealed the Commission’s decision. On appeal, the Hortians must show that the Commission did not follow the standards for CUPs set forth in the zoning ordinance and that granting the CUP was an abuse of discretion.

The Hortians challenged the county’s interpretation of WCZO §741(3) which mandates that there should be “no outside storage of supplies, equipment or maintenance items; all work and work related items shall be kept in an enclosed structure.” They claim that customers’ cars parked outside of Fischer’s building waiting for repair qualify as “equipment” or “work-related items”.  The Commission instead determined that the cars were neither “equipment” nor “work-related items,” but were rather regulated by another part of the ordinance that only prohibits parking unlicensed or inoperative vehicles.  The Commission attached a specific condition to the amended CUP that “all vehicles and trailers on the property must have current registration and/or licensure unless otherwise exempt by law.” The court sided with the Commission. Considering these vehicles as “equipment” or “work-related items” is a narrow definition that would limit Fischer’s ability to work from home.

The Hortians claimed that the Commission made an error in granting the amended CUP because Fischer’s business is injurious to neighboring properties because of the additional wear on the roads, the high volume of sounds from the tools, and the bright lighting installed around the building. During a site visit the Commission found that none of these were true and that the operation complied with the ordinance.  The court did not dispute that finding, either.

The Hortians argued that Fischer’s business did not fit in an agriculturally zoned area. The Commission found that, while the business is industrial in nature, it serves an agricultural community and an agricultural purpose and therefore fit in the zoning classification.

The Commission did not err by granting the CUP.

Minnesota Environmental Protection Act requires EIS prior to issuance of certificate of need for oil pipeline

In the Matter of the Application of North Dakota Pipeline Company LLC for a Certificate and Permit for the Sandpiper Pipeline Project in Minnesota
Minnesota Court of Appeals, September 14, 2015

Friends of the Headwaters (FOH) challenged a decision by the Minnesota Public Utilities Commission (MPUC) to move forward on a final decision on a certificate of need for an oil pipeline by arguing that this violates Minnesota’s Environmental Protection Act (MEPA).

In 2013 North Dakota Pipeline Company LLAC (NDPC) applied for a certificate of need and a pipeline routing permit to connect oil pipelines in North Dakota to other pipelines in Minnesota and Wisconsin. In early 2014 MPUC approved the permits and allowed hearings and environmental review to move forward.

The Energy Environmental Review and Analysis unit (EERA) gathered 53 route alternatives and one system alternative through public outreach that were accepted by MPUC. Route alternatives are defined as, “a deviation from the [NDPC’s] proposed project with no apparent major engineering or environmental issues.” System alternatives are defined as, “a pipeline route that is generally separate or independent of the pipeline route proposed by [NDPC], and that does not connect to the specified Project endpoints.” MPUC decided to bifurcate the certificate of need and pipeline routing permit proceedings. MPUC told EERA to do an environmental evaluation of all of the systems alternatives to be used during the certificate of need proceedings, but that this would be used to develop a record and “not be equivalent in terms of the specificity and level of detail to a comparative environmental analysis undertaken in the route permit proceeding.”

The issue at stake is whether MEPA requires an environmental impact statement before MPUC can make a final decision on a certificate of need for an oil pipeline.

All parties acknowledge that MEPA environmental review must happen at some point during the approval process, but the question is when this must happen. When certificate of need and routing permit proceeding are conducted together Chapter 7852 of Minnesota administrative rules requires applicants to do a comprehensive environmental assessment for the pipeline routing permit. The Environmental Quality Board has allowed this assessment to take the place of a formal environment impact statement. FOH argues that making a decision on the certificate of need without a formal environmental review violates MEPA.

Minn. Stat. § 116D.04, subd. 2a (2014), requires the responsible governmental unit to prepare a detailed EIS before engaging in any “major governmental action” that creates the “potential for significant environmental effects.” Subdivision 2b says that “a project may not be started and a final governmental decision may not be made to grant a permit, approve a project, or begin a project…” FOH argues that issuance a certificate of need qualifies as making a final governmental decision. The court agreed. The language of those statues is unambiguous and as applied to this situation means that when the MEPA complaint environmental review will not happen until after the certificate of need is issued, an environmental impact statement must be competed as part of the proceedings.

The Court of Appeals reversed the grant of a certificate of need and remands to the MPUC to complete an EIS before holding certificate of need proceedings.

Neighbor testimony sufficient evidence to support CUP denial

by Andrea Vaage

August v Chisago County Board of Commissioners
Minnesota Court of Appeals, August 17, 2015

Jeffrey August purchased a 20-acre tract of land in Sunrise Township, in Chisago County, Minnesota. August built a fenced-in arena and later an announcement system for mounted shooting events he hosted on the property. In 2013, August formed a club, Cowboy Mounted Shooting, which held competitions and clinics. Mounted shooting involves contestants on horseback who shoot .45 caliber blanks at balloons on posts in the middle of the arena. These competitions were held throughout the summer, typically starting in the afternoon and continuing until dusk. In 2014, the Chisago County zoning department inspected the property after hearing complaints. The department found the use of the property did not conform to its zoned agricultural use. The zoning department then recommended August apply for a conditional use permit (CUP). August complied and filed a request to allow a rural retail tourism/commercial outdoor recreation use.

Two entities provided recommendations on the CUP: Sunrise Township and Chisago County Planning Commission. Sunrise Township recommended denial of the CUP based on the excessive and disruptive noise. The County Planning Commission also recommended denial of the CUP based on comments at a public hearing that noise levels were high and consistent and a planning report which stated that, although the noise was below the allowed decibel limit, it was still clearly audible from neighboring properties.

The public hearing for the CUP was held on July 16, 2014. The County Board of Commissioners denied the permit based on that hearing and the recommendations provided by the Planning Commission. August appealed. At issue is whether the denial of the CUP was unreasonable, arbitrary, or capricious. The test to determine if a zoning board decision was sound is two-pronged: the reasons given for denial are legally sufficient and the reasons had a factual basis in the record.

The legal basis for denying the CUP was Section 4.15(D)(5) of the Chisago County Zoning Ordinance (CCO) regulating rural retail tourism. Pursuant to this section, a proposed rural retail tourism use will only be allowed if it “will not negatively impact the neighborhood by intrusion of noise, glare, odor, or other adverse effects.”

The Board established several facts in regards to the noise issue. The Board relied in part on neighbors’ testimony that there was a significant increase in noise and traffic on weekends when the mounted shooting events were held. The arena for these events was located within 500 feet of adjacent homes, and noise was heard by neighboring residents. Additionally, the planning commission members’ trip to the property confirmed the high levels of noise resulting from the gunfire.

August argued the Board cannot rely on neighbor’s testimony, however, the court relied on previous rulings that found that “a municipal entity may consider neighborhood opposition when it is based on something more concrete than non-specific neighborhood opposition.

August also argued that the CUP could only be denied if the noise levels exceeded decibel levels set by the Minnesota Pollution Control Agency (MCPA). The Court found that the county zoning ordinances were not in conflict with the MCPA standards because it regulates noise based on neighborhood intrusion, not decibel levels.

The County Board of Commissioners decided to deny the CUP based on sufficient legal and factual basis and was not unreasonable, arbitrary, or capricious. The Board’s decision is affirmed.

Contempt of Court Holding Affirmed in Minnesota Wind Turbine Case

by Andrea Vaage and Gary Taylor

City of Orono v Nygard
Minnesota Court of Appeals, June 1, 2015

Jay and Kendall Nygard constructed a wind turbine in their backyard in Orono, Minnesota in violation of the City’s zoning code, and after they were denied a permit to do so.  The Nygards challenged the denial in district court and lost; however, in a 2012 decision the Minnesota Court of Appeals reversed and remanded the district court’s decision, finding that list of permitted uses in the zoning code – which did not include wind turbines – was not exhaustive.  On remand the city sent the Nygards a series of questions designed to help the city determine the relevant provisions of the zoning code, which the Nygards refused to answer.  The city thus denied the permit again. The district court supported the denial and ordered the Nygards to remove the wind turbine, pole, and concrete pad supporting the structure. The Nygards refused to comply, whereupon the district court found them in constructive civil contempt of court. The Nygards attempted to stay the contempt proceedings, which the district court denied, leading to this appeal. The Nygards first argued the court lacked subject matter jurisdiction to find them in contempt because contempt proceedings arose from their failure to comply with the district court’s order in their permit dispute, and the district court lacked subject matter jurisdiction over that permit dispute.

Subject matter jurisdiction refers to the ability of a court to adjudicate a class of actions and the questions in those actions. In Minnesota, the party attacking subject matter jurisdiction must show the court lacked authority as well as prove one of three factors:  (1) The subject matter of the action was so plainly beyond the court’s jurisdiction that its entertaining the action was a manifest abuse of authority; (2) Allowing the judgment to stand would substantially infringe the authority of another tribunal or agency of government; or (3) The judgment was rendered by a court lacking capability to make an adequately informed determination of a question concerning its own jurisdiction and as a matter of procedural fairness the party seeking to avoid the judgment should have opportunity belatedly to attack the court’s subject matter jurisdiction.

The Court of Appeals found the Nygards never presented the district court with any evidence or argument to support the existence of any of the three factors, and the Court of Appeals therefore refused to consider the arguments for the first time on appeal.  The Nygards then argued the district court lacked subject matter jurisdiction because the Nygards failed to exhaust all administrative remedies by making an administrative appeal. However, Minnesota law only allows municipalities to make that defense, not the applicant.

The Court affirmed the district court’s judgment and ordered the Nygards to comply with the earlier order to remove the wind turbine and its components.

Minn Court of Appeals upholds new water quality standards for rivers and streams

by Gary Taylor

Minnesota Environmental Science and Economic Review Board, et al v. Minnesota Pollution Control Agency
Minnesota Court of Appeals, August 10, 2015

[For background, an article on the case can be found here.]

Petitioners in this case included the Minnesota Environmental Science and Economic Review Board (a coalition of cities believed to be most affected by the agency rules in question), The Coalition of Greater Minnesota Cities, the League of Minnesota Cities and the Minnesota Soybean Growers Association.  They brought this suit against the Minnesota Pollution Control Agency (MPCA) to challenge the rulemaking process (not the scientific basis for the rules) for adopting new numeric water quality standards (WQS) for certain pollutants to limit eutrophication** of rivers and streams.  The Court of Appeals addressed two issues raised by the parties: (1) the standing of the petitioners to bring suit, and (2) MPCA’s response to public comments on the proposed rules during the rulemaking process.

Standing.  MPCA argued that the petitioners lacked standing because they failed to specify any specific rights with are currently affected by he rulemaking process, and that their potential harms “were too tenuous and rely on too many indeterminate assumptions to establish standing.”  The Court of Appeals disagreed, finding that “petitioners are challenging a rule that created numeric standards, not merely the inclusion of certain rivers on a list that would eventually lead to numeric standards.  Petitioners are among the class of persons who would be affected by a change in WQS; the petitioning groups represent municipalities, wastewater-treatment facilities, sanitary sewer districts, and farming operations, all of which have a more particularized interest than the general citizenry.”  The Court of Appeals concluded that petitioners indeed did have standing.

Response to public comments. Petitioners alleged that MPCA did not comply with statutory rulemaking procedures because it failed to adequately respond to petitioners’ comments during the rulemaking process.  They argued that MPCA relied on outdated studies and failed to make the studies it relied on part of the public record.  Petitioners relied on federal caselaw for the proposition that agency responses to comments must be “meaningful”; that is, the agency must respond in a manner that states the main reasons for its decision and explains why the agency reached the decision it did.

The Court of Appeals refused to second-guess the agency’s use of, or reliance on its chosen scientific or technical sources.  Agency decisions enjoy “a presumption of correctness.” Agencies must at times

make judgments and draw conclusions from suspected, but not completely substantiated relationships between facts, from trends among facts, from theoretical projections from imperfect data, from probative preliminary data not yet certifiable as fact, and the like.

The MPCA responded to all of the written comments received after each public hearing, including a summary of the comment and a response with citations to the documents or sources that provided the basis for the response.  Although petitioners did not agree with the rules adopted, the Court concluded that the MPCA sufficiently explained the reasons for their adoption and provided sufficient supporting documentation.  This met the test for “meaningful” response.

The Court declared the new water quality rules to be valid.


**Eutrophication is a syndrome of ecosystem responses to nitrogen and phosphorus, often leading to changes in animal and plant populations such as algae blooms and the proliferation of rooted plants.

MN county ordinance required formal adoption of planning commission findings on the record at a meeting

by Hannah Dankbar

Bio Wood Processing, LLC v. Rice County Board of Commissioners
Minnesota Court of Appeals, April 13, 2015

Bio Wood Processing recycles wood products into bedding for animals and mulch. Its facility is located in Rice County, near the City of Faribault. The area of the facility is zoned as urban-reserve, and any agriculture businesses must obtain a conditional use permit (CUP). Bio Wood received a CUP in 2011 that restricted the hours they could grind wood.

In 2013 Bio Wood asked to amend its CUP; this included an expansion of its hours of operation. The planning commission allowed longer wood grinding hours, but reduced the total hours of operation. In 2014 Bio Wood applied for another amendment that asked for a new set of conditions that did not include any restrictions on hours of operation. After hearing from company representative and community members who live near the facility, the planning commission took a voice vote and decided to recommend denial of the application.

Between May 1 and 13, 2014 a written document entitled “Findings of Fact” was written with notes from the Planning Commission meeting to pass along to the Board of Commissioners. The Board of Commissioners followed the recommendation and denied the application. Bio Woods appealed.

Bio Woods claimed that the county erred in judgment in multiple ways; (1) the planning commission failed to make findings of fact on the record, (2) the board failed to engage in reasoned decision-making, (3) the board’s findings are not supported by the factual record and (4) the board treated applicants who are similarly situated differently.

Bio Woods claimed that the Planning Commission did not meet the requirements of the county ordinance, which states in part that “the report from the planning commission to the County Board shall take the form of formal findings on the record.” The county argued that nothing in the ordinance required them to write the findings themselves or read them out loud on the record. A notary public did certify a portion of a transcript, but not the section that mentions findings of fact. The court found the plain meaning of the ordinance required the commission to make formal findings in the course of a public meeting, either by stating them orally or by approving a previously prepared document that includes written findings. The court determined that the county did not satisfy the plain meaning of the county ordinance because county staff prepared written findings from a meeting after the meeting happened and submitted the written findings to the County Board without the Planning Commission ever formally adopting them  “on the record.”

The court reversed the Board of Commissioner’s decision to deny the CUP. The matter went back to the county to make valid findings in this case.

Correctional community-residential facility not appropriate in area designated for future industry

by Hannah Dankbar and Gary Taylor

Volunteers of America- Minnesota v City of Saint Paul
Minnesota Court of Appeals, January 20, 2015

Volunteers of America- Minnesota (VOA) claimed the City of St. Paul was wrong to deny their application for a conditional-use permit, saying that the denial was arbitrary and capricious. VOA is a non-profit faith group, which operates a center in Roseville for adults transitioning out of the federal corrections system. The center is licensed by the Minnesota Department of Corrections and has a contract with the federal government. The center had to move because their lease expired in the previous center. The organization selected 1394 Jackson Street in St. Paul and signed a purchase agreement in 2011. The property is zoned I-1 “light industrial.” Even though the property had served as a correctional community-residential facility in the past, VOA had to get a conditional-use permit from the city. VOA had to satisfy the zoning code’s five general conditions and six specific conditions, found in Section 61.501 related to correctional-residential facilities.  The five general conditions are:

  1. The extent, location and intensity of the use will be in substantial compliance with the Saint Paul Comprehensive Plan and any applicable subarea plans which were approved by the city council.
  2. The use will provide adequate ingress and egress to minimize traffic congestion in the public streets.
  3. The use will not be detrimental to the existing character of the development in the immediate neighborhood or endanger the public health, safety and general welfare.
  4. The use will not impede the normal and orderly development and improvement of the surrounding property for uses permitted in the district.
  5. The use shall, in all other respects, conform to the applicable regulations of the district in which it is located.

Section 65.154(d) of the zoning code limits to 16 the number of residents allowed at a community residential facility such as VOA. VOA requested that it be allowed to have 74 residents – the number of residents needed to generate sufficient operating revenue. The planning commission approved a conditional use permit and granted a upward modification of Section 65.154(d) to allow 32 residents.  VOA appealed to the city council, but the permit was denied outright by the council – not because of the occupancy limits – but rather because the application did not satisfy subsections (1) and (4) of Section 61.501.

The city determined that the planning commission erred in finding that the center substantially complies with comprehensive and district plans. The district plan states that the area should be redeveloped as “a business center with light industrial and office-service uses.” VOA asserts that the center should be considered an “opportunity site” that either focuses on mixed use development or the creation of employment centers. Neither the city council nor the Court of Appeals agreed with VOA’s assertion.  The city had plans to redevelop that area for industry for over 30 years, and with several major road construction projects nearing completion, the court said it was reasonable for the city to conclude that VOA’s proposed project does not align with the plan.

The court also found that the city’s conclusion that Jackson Street center would impede normal and orderly development was not arbitrary and capricious. Allowing the center would impede a new industrial/office park that is likely to come to the area and be at odds with the type of industrial development that is a priority to the area.  VOA’s argument that its current facilities in other locations “show a successful track record and positive feedback from neighbors” may alleviate concerns about the proposed center, but it does not establish that the center would not impede future plans for industrial and commercial development.

The city’s denial of VOA’s conditional use permit application was affirmed.

RV a permissible accessory use in R-1 district when principle use of lot is for “recreation”

by Hannah Dankbar

Schultz v Mende, et al. and City of Madison Lake
Minnesota Court of Appeals, December 8, 2014

In July 2007 the Mendes applied for a Conditional Use Permit (CUP) to build a boathouse on their property in the City of Madison Lake, Minnesota. The city council approved and issued the permit “with the condition that at the time of sale conditional use will be reviewed” and that the use follow all applicable provisions of the zoning code. In April 2008 the city found out that the Mendes were selling the property. The city sent a letter to remind the Mendes that the property could only be used as explicitly described in the CUP, and the CUP did not allow for human habitation of the property. Chapter 5, Subd. 4(b)(1)(D) of the city ordinance provides that boathouses cannot be used as a dwellings and cannot contain sanitary facilities.

In Spring 2008 Schultz bought the property from the Mendes believing that he could park a RV or camper on the property to sleep in while using the boathouse. The city told Schultz that, “since the conditional use was granted solely for a boat house and not for any type of residential use, parking a recreational vehicle on this property is a violation of the conditional use permit and an illegal use.” In February 2009, the city reiterated this statement. In August 2009 Schultz asked to amend the CUP; the city denied the application.

In response Schultz brought an action against the Mendes arguing that they misrepresented the use of property. The Mendes responded by filing a complaint against the city, saying that the city’s position was unconstitutional and unenforceable and asked for a declaratory ruling to allow for an RV on the property. The district court found that the zoning ordinance did not preclude the use of an RV on the property, the RV being “clearly accessory and incidental to the primary purpose of the property, which is recreation.” The city appealed the decision.

The property is in an R-1 residential district, which generally allows for “low-density, single family residences and directly related complimentary uses.” The General District Provisions prohibit an individual from dwelling or residing in an “accessory building.” An “accessory building” is defined as “[a] use incidental to and on the same lot as a principal use.” The property does not meet the minimum size requirements to meet the standard for single family housing.

The city considered the RV an accessory building. The district court disagreed with this definition, stating that “buildings” is limited to permanent structures. On appeal the city argued that the district court substituted their own definition for what is provided for in the ordinance. The Court of Appeals agreed that there is room for interpretation in the definitions provided by the ordinance; however, in a separate section of the ordinance “recreational vehicle” is defined as “a vehicular portable structure used for amusement, vacation or recreational activities.”  The Court of Appeals determined that implying that recreational vehicles are buildings, when recreational vehicle is specifically defined in the code is an improper interpretation of the ordinance.

The parties disagreed over the principal use of the property. Schultz and the Mendes say that the principal use is recreation, while the city claims it is the boathouse structure. The Court of Appeals agreed with the district court’s conclusion that the principal use is recreation. Given that the principal use of the property is recreation, the question then becomes whether the recreational vehicle is an allowable accessory use.  The city argued that the recreational vehicle could only be used for storage (and not sleeping) because the boathouse – a facility for storing boats – was the principal use.  Given the courts previous conclusion that the primary use was recreation, the city’s argument was inappropriate.  Under a plain reading of the ordinance, both RVs and boathouses are permissible accessory uses to the primary recreational use.  RVs are accessory uses as long as they carry a current registration and are in “operable condition.” Boat houses are also allowed as long as they are not “designed or used for human habitation” and do not “contain water supply or sewage treatment facilities.”

Because the zoning ordinances are ambiguous and the city’s interpretations leads to an “absurd result” the Court of Appeals upheld the district court’s ruling in favor of the Mendes.



MN township not authorized to levy permit review expenses against landowner

by Rachel Greifenkamp

Great Western Industrial Park, LLC v. Randolph Township
Minnesota Court of Appeals, September 8, 2014)

South of the Twin Cities along the Minnesota-Wisconsin border lies Randolph Township. Here, Recovery Technology Solutions (RTS) was considering purchasing land from Great Western Industrial Park, LLC to use as the site for a facility for recycling asphalt shingles. RTS submitted an application to Randolph Township for a conditional use permit that was denied, and so RTS decided against purchasing the available land. After the denial of the application RTS received a letter stating that it was to reimburse the township for all expenses incurred in the application review, which totaled $31,666.41 (mostly legal and consulting fees). When RTS did not pay the expenses the township wrote a letter to Great Western (the landowner) notifying it of its responsibility for the expenses, as well as interest, late charges, recording charges, and attorney’s fees. The township also informed Great Western that the amount was going to be certified to the County Auditor for collection with the 2014 property taxes.  Great Western sued.

Minn. Stat. 366.012 states:

If a town is authorized to impose a service charge for a governmental service provided by the town, the town board may certify to the county auditor of the county in which the recipient of the services owns real property, on or before October 15 for each year, any unpaid service charges which shall then be collected together with property taxes levied against the property.

Minn. Stat. 462.353 provides:

A municipality may prescribe fees sufficient to defray the costs incurred by it in reviewing, investigating, and administering an application for an amendment to an official control established pursuant to sections 462.351 to 462.364[governing municipal planning and development] or an application for a permit or other approval required under an official control established pursuant to those sections. Except as provided in subdivision 4a,[1] fees as prescribed must be by ordinance. Fees must be fair, reasonable, and proportionate and have a nexus to the actual cost of the service for which the fee is imposed.

Noting that any prescribed fee “must be by ordinance,” the Court of Appeals reviewed the township’s zoning and fee ordinances and found no provision that permits the township to impose a fee on a property owner when a CUP application is denied and the CUP applicant fails to pay the costs incurred by the township in processing the application. The township relied on a section in the fee ordinance that requires that a $300 nonrefundable fee and a minimum $1,200 escrow payment be submitted with a CUP application, but the court found that this language does not authorize the township to impose a service charge on the owner of the property for which the CUP was sought.

The township was not authorized to impose a service charge against Great Western for the expenses incurred by the township in processing RTS’s conditional use permit application, and the ruling fell in favor of Great Western.






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