Court of Appeals 07.14.09

I feel compelled in some way to report on the Court’s latest opinion release, especially since there’s a published land-use decision.  That said, even I’m having a hard time finding much to take away from these cases.  The neighbor-petitioner in Krummenacher v. Minnetonka challenges the city’s ability to allow expansion of nonconforming use by variance; the statute since 2004 has been pretty clear about a city’s ability to allow expansion through a hearing/permit process of its choosing.  An unpublished opinion on a negligent-repair case from Waseca is a helpful run-down of the benefits of having a road-repair policy, but nothing out of the ordinary.  And like most end runs, the legal outcome of “Gun SMOKE Monologues” fails to surprise. 

Summertime blues, maybe?

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Supreme Court affirms Krengel case

This morning, the Supreme Court released its opinion affirming the decision in West St. Paul v. Krengel.  The Court of Appeals previously ruled against the City’s use of a nuisance-abatement injunction because the City lacked evidence of two instances of public nuisance within a 12-month period.  The Supreme Court “simplified” the analysis, finding that Krengel had “abated” the nuisance and thus the law barred the City from seeking the injunction.  The Court makes clear that the amount of time the nuisance is cleared doesn’t matter, though timing was central to the Court of Appeals opinion: “the abatement of statutorily-defined nuisance activity … prevents the prosecuting attorney from seeking an injunction under the Public Nuisance Law.”  In a footnote to that sentence, the Court refuses to interpret “within 12 months,” finding it irrelevant.

By shaping their ruling this way, the Supreme Court has either exposed a big hole in the nuisance-abatement statute or rendered a section of it effectively meaningless.  When a city gets to the point (usually after a long, long history with the property) of filing for a nuisance injunction, the property owner has three choices: fight, fix the problem immediately, or enter into a nuisance abatement plan.  In developing a nuisance-abatement plan, especially for a behavioral nuisance problem like in the Krengel case, the city wants to get at some of the underlying causes behind the nuisance, like chemical dependence, and wants to be able to verify compliance.  Despite a clause in the statute which seems to indicate that the city can pick up the injunction case if there’s a failure to comply with the abatement plan, the Supreme Court today rules that the “abatement” of a nuisance completely severs any ability to pursue the injunction.  Without the ability to bring the injunction back before the court, there is no remedy available to a city for failures to comply with the nuisance abatement plan which are not in themselves public nuisances.  All agreement terms beyond “knock it off” are unenforceable.

With that as the rule, it’s not clear why cities should even bother with agreements – either the nuisance exists or it doesn’t.  If the city can’t follow through on making the owner address root causes or even agree to compliance inspections, there’s no upside to stopping the injunction process because the owner promises to straighten things out.  Remember, barring someone from their property for a year is a compliance tool of last resort, after code citations and other efforts to solve the problem have utterly failed.  At this stage, there’s no trust between the city and the landowner.  From the City’s perspective, it seems better to get the temporary injunction and then discuss achieving compliance over time.  This doesn’t seem to be what the Legislature had in mind (it made several tweaks to timing provisions in reaction to the Court of Appeals decision).  Without a statutory remedy for abatement-agreement problems (say, making those a basis for obtaining an injunction, or at least allowing the parties to agree to make them the basis for an injunciton), a public-nuisance injunction case is going to be an all-or-nothing matter.

Court of Appeals 07.07.09

The Court released two unpublished opinions in our area of coverage, an assessment appeal out of Rochester, and a nonconforming use dispute from Oronoco Township.  To read the Oronoco Township opinion is to believe that the justices rolled their eyes at the landowners’ case, and maybe they did.  The problem with this kind of writing is while unpublished opinions aren’t precedent, they are helpful to practitioners tasked with fitting the law to the facts in front of them.  So when the Court gets a matter where the Town and the landowner have already been through three rounds, it’s worth it to give more descriptive detail than “the Overbys constructed a shed.”  A shed?  Are we talking about a “kit from Menard’s” shed or a “truck terminal in your backyard” shed?  It really does make a difference to us in the ability to use the opinion as an anecdote – if there’s some economic substance here (which would be implied by the extended legal battle) then counsel can use this case to persuade owners, applicants, and Board members about the need to read local rules.  People can see their situation in a reasonably presented set of facts and can be swayed from doing dumb things.   If we’re just looking at a ridiculous homeowner who won’t move a tool shed twenty feet (as indicated by the eye-rolling), then nobody identifies.  The opinion as written makes the appellants out to be fools – a few more details would let the rest of us judge for ourselves.

Admittedly, the Rochester case is less likely to be used as an anecdote someday – when it turns out that your city assessment exceeds any benefit by over a million dollars, there’s not much that you’re going to do to save it at that point.  Rochester and MnDOT created a TID district with improvement fees.  A commercial property declined to pay the fee (as was their right), so Rochester assessed (also fully disclosed from the start).  Problem is, Rochester assessed the TID fee ($1.7 million) on the basis of all improvements in the district, which turned into a problem when the trial judge cut out the improvements paid for with Federal dollars.  The remaining “city” project was nowhere close to providing $1.7 million in value increase.  The Court of Appeals affirmed, refusing to extend the MacKubin Street reimbursement doctrine (city can still assess state-aid funded road projects even if reimbursed)  to projects partially or totally funded with Federal money.

“Very boring but extremely informative”

Not exactly the credo I’m after, but I’ll take compliments when they’re given.

Unallotment – missing a step?

It’s July 1st, and the “final” numbers are out on the unallotment plan for the biennium that starts today.  I’m still not sold on the idea that an executive tool to deal with the shortfalls at the end of a budget year can be used to shape the budget at the outset of the year.  I think I’ve put my finger on why:

Subd. 4.Reduction.

(a) If the commissioner determines that probable receipts for the general fund will be less than anticipated, and that the amount available for the remainder of the biennium will be less than needed, the commissioner shall, with the approval of the governor, and after consulting the Legislative Advisory Commission, reduce the amount in the budget reserve account as needed to balance expenditures with revenue.

(b) An additional deficit shall, with the approval of the governor, and after consulting the legislative advisory commission, be made up by reducing unexpended allotments of any prior appropriation or transfer. Notwithstanding any other law to the contrary, the commissioner is empowered to defer or suspend prior statutorily created obligations which would prevent effecting such reductions.

(c) If the commissioner determines that probable receipts for any other fund, appropriation, or item will be less than anticipated, and that the amount available for the remainder of the term of the appropriation or for any allotment period will be less than needed, the commissioner shall notify the agency concerned and then reduce the amount allotted or to be allotted so as to prevent a deficit.

The text is from Minn. Stat. 16A.152, with emphasis on what seems to trigger the unallotment process.  Now, the Commissioner of Finance has sent the Governor a message stating that “probable receipts for the general fund will be less than anticipated, and that the amount available for the remainder of the [2010-2011] biennium will be less than needed.”  This is clearly a cut-and-paste from the statute, right down to the brackets to cram in “2010-2011.”  This begs the question: receipts will be less than anticipated when?  The MMB’s actual estimates that would seem to be in play pre-date the Legislature’s last actions.  In other words, the Legislature “anticipated” the amounts of revenue depicted in those forecasts and updates – which is presumably why they passed additional revenues to support the spending bills.  The Commissioner’s letter giving the Governor the green light compares the November 2008 and Feburary 2009 forecasts, revenue performance in March, April and May of this year, and general pessimism to support his determination that 2010 and 2011 revenue will be “less than anticipated.”  (Note, though, that the year-end rollup from MMB projects 2010-2011 revenues as better than expected in the February forecast).  Of course, this is all data that was available when the Legislature passed the budget – which should set the baseline for our “expectations” of revenue.  Not that much changed between May 22 and June 4 to say otherwise.

Putting cynicism aside, here’s the real structural question: how is even the best analysis on or before June 30, 2009 of “less than anticipated” revenues, a credible “determination of probable receipts” over the entire biennium?  The Governor is proposing cuts and shifts to both 2010 and 2011 budget allocations.   Almost by definition, any forecasting done during budgeting, or even projections done now at the outset of the biennium, is “anticipation” of future revenue.  How can today’s numbers logically support a “determination” of shortfall in March 2010?  March 2011?  The records on the last round of unallotment show it to be a dynamic process highly related to the actual reality of incoming revenue.  Now matter how hard anyone tries, there’s no way to make a credible statement about the reality of revenue performance until a significant amount of the data is in and real revenue can be compared against estimates.

Unallotment, as a budget tool, is intended for adjustments to fiscal reality at the end of a fiscal year.    Without even getting into the separation-of-powers concerns raised, it seems pretty evident that it is not a tool to “fix” the budget at the start of a biennium.  Now the question is, who wants to do anything about it?

Court of Appeals 06.30.09

Yes, the Supreme Court decided another momentus case yesterday, but that’s been fairly well covered elsewhere.

The Court of Appeals issued several opinions of interest yesterday, all unpublished.  The Court reversed and remanded a CUP denial by Otter Tail County – not surprising, as the planning commission and county board deadlocked on the a developer’s revised proposal and ended up using their first set of drafted findings to justify denial.  The County catches a break in the Court’s remand for additional consideration instead of simple direction to issue a permit.  The Court upholds summary judgment for Minneapolis in the Trocaderos defamation claim against a City Council member – if you’re going to say negative things about a litigious property owner, make sure they are “substantially true.” 

I don’t know what to say about this St. Paul house-demolition case: the City is within its rights and followed procedure, and the Court recognized that in ruling in the City’s favor.   I don’t know what’s gone on behind the scenes in the last year.  It’s true that this woman’s legal claims probably lie against the schlemiels who sold her the duplex without telling her it was slated for “nuisance abatement,” and action was imminent.  Identifying all of those “known unknowns,” decisions like this still leave me cold – would it have killed anyone to have a new set of hearings once they found out that someone bought the property on the deadline and hadn’t ever been sent a notice?  Why do these hyper-technical cases get this far?  Maybe more to the point: why does Saint Paul still insisting on demolishing houses to the exclusion of all other options when: a)  nobody is clamoring to build on city lots;  and b) it’s increasingly being demonstrated that vacant lots are worse for the neighborhood than bad buildings?  This is increasingly looking like a bad policy blindly defended to avoid acknowledging any error.