Dakota County District Court File No. C4027356
Considered and decided by Kalitowski, Presiding Judge, Randall, Judge,
and Schumacher, Judge.
Minn. Stat. § 469.1771, subd. 1 (2000), confers original jurisdiction upon the district court to review a municipality's determination of a tax-increment financing district.
The opinion of the court was delivered by: Robert H. Schumacher, Judge
Appellants Roger and Gladys Reiling, Ray and Marilyn Sandford, Patricia and Frank Pavlik, and Ray-Mar Rental challenge the district court's grant of summary judgment dismissing their claim, alleging that respondent City of Eagan improperly included their property in a redevelopment tax increment financing (TIF) district. By notice of review, respondent argues the district court lacked subject-matter jurisdiction to review respondent's quasi-judicial TIF determination. We affirm.
By resolution passed in February 2002, the Eagan city council created a redevelopment TIF district pursuant to Minn. Stat. § 469.174, subd. 10 (2000). Minnesota State Highway 55 bisects the district into a northern area that includes primarily residential property owned and inhabited by appellants and a southern area occupied primarily by commercial and industrial property.
A municipality may create a redevelopment TIF district only after finding by resolution that at least 70% of the parcels in the district are occupied by improvements covering at least 15% of the area of each parcel and that at least 50% of the buildings, excluding outbuildings, are"structurally substandard." Minn. Stat. § 469.174, subd. 10(a)(1)(e). A building is considered structurally substandard if the cost of modifying the building to satisfy the building code applicable to new buildings is greater than 15% of the cost of constructing a new structure of the same square footage and type on the site. Id., subd. 10(c). In determining whether a building is structurally substandard, a municipality may consider
reasonably available evidence, such as the size, type, and age of the building, the average cost of plumbing, electrical, or structural repairs, or other similar reliable evidence. * * * An interior inspection of the property is not required, if the municipality finds that (1) the municipality or authority is unable to gain access to the property after using its best efforts to obtain permission from the party that owns or controls the property; and (2) the evidence otherwise supports a reasonable conclusion that the building is structurally substandard. Id.
A TIF redevelopment district can be comprised of"contiguous or noncontiguous" geographic areas. Id., subd. 9. If a redevelopment TIF district consists of two or more noncontiguous areas, each area must independently meet the statutory definition of a redevelopment district. Id., subd. 10(f). The terms"contiguous" and"noncontiguous" are not defined in any of the applicable statutes.
Respondent's resolution establishing the redevelopment TIF district included the findings and supporting documentation required by Minn. Stat. § 469.175, subd. 3 (2000). Among the materials before the city council was a property inspection report prepared by Bonestroo, Rosene, Anderlik & Associates, an engineering firm. The Bonestroo report noted that appellants' residential parcels, on the north side of highway 55, are all located on an unpaved street with no curbs, gutters, or storm drainage structures and that none of appellants' residences are served by municipal sewer or water services. The report concluded the proposed redevelopment TIF district met the statutory criteria for a redevelopment district and that, without exception, the cost of modifying appellants' buildings to satisfy the building code applicable to new homes would be greater than 15% of the cost of constructing a similar building on each site.
After respondent passed the resolution, appellants brought an action in district court seeking a temporary injunction prohibiting respondent from including their parcels in the redevelopment TIF district. Appellants argued highway 55 divides the district into noncontiguous areas and that each area must independently meet the statutory definition of a redevelopment district as required by section 469.174, subd. 10(f). Appellants contended their area, considered independently, did not meet the definition and must be excluded from the district. Appellants also ...