ZONING
Constitutional challenges to odor and zoning ordinances

Sanimax USA, LLC v. City of S. St. Paul, 95 F.4th 551 (8th Cir. 2024)

The facts: Sanimax operates a rendering plant in South St. Paul that processes animal carcasses and organic byproducts. The city was long the center of the livestock trade but shifted to light industrial uses in recent years. The city adopted a comprehensive plan that set forth future land use policies and worked to address odor issues from “holdover” companies like Sanimax. The city issued its first odor pollution ordinance in 2014, amending it in 2017. In 2019, the city passed a zoning ordinance placing Sanimax in a light industrial district. That ordinance made Sanimax a legal nonconforming use, meaning Sanimax could continue to operate, but not expand. A 2020 ordinance was enacted to address significant resident frustration, which resulted in Sanimax receiving administrative citations and fines.

The type of case: Sanimax filed Section 1983 lawsuits alleging first that the city violated its First Amendment rights by retaliating against it for contesting earlier ordinances. Next, it alleged the zoning ordinance violated the equal protection clause of the Fourteenth Amendment because other similarly situated businesses were excluded from the light industrial district. Third, it alleged that the 2020 odor ordinance was unconstitutionally vague, which is a violation of the due process clause of the Fourteenth Amendment. The city prevailed on all issues at the lower court.

The issues: On appeal, Sanimax argued the lower court erred in disregarding evidence showing the city enacted ordinances specifically to target the company. One email showed the city planner commenting that the city’s previous odor ordinance was not strong enough. A second discussed a wish to enact the 2020 ordinance to impose fines rather than simply require Sanimax to develop odor management plans. And a third explained the city intended to use the ordinance to punish noncooperative businesses like Sanimax to the extent the code allowed.

The court’s ruling: The U.S. Court of Appeals for the Eighth Circuit held that the emails did not show the city had a retaliatory or bad faith motive. Rather, the communications showed the city was faced with frustrated residents and an acute odor problem and altered its response to increase enforcement. The court also rejected the assertion Sanimax was treated differently than other similar businesses. The two businesses offered by Sanimax as comparators, or similar organizations, tanned hides rather than rendering animal products. Additionally, during a time the city received 79 odor complaints about Sanimax, it received seven total from the other two businesses. Finally, the court held the language of the ordinance was similar enough to traditional nuisance statutes it was not too vague for Sanimax to know what was prohibited.

What this means for cities: In addressing holdover nuisances after a significant shift in industry or zoning, the city must show that any ongoing nuisance behavior is the impetus for an ordinance adoption or change, versus retaliation for past pushback by a company.

EMPLOYMENT LAW
Minnesota’s Veteran’s Preference Act

Zepeda v. Saint Paul, No. A23-1210 (Minn. Ct. App. Mar. 11, 2024) (nonprecedential opinion)

The facts: Kenneth Zepeda is an honorably discharged veteran who worked for the City of Saint Paul as a fire engine operator. Zepeda and five other responders answered a medical call for a combative patient. After responders got the patient inside the ambulance, he continued to resist by kicking and spitting. Zepeda eventually manipulated a pressure point on the patient, causing him to submit. Zepeda and the other responders were placed on paid leave while another county investigated. Results were presented to the Minneapolis city attorney’s office for consideration of criminal charges, but that office declined to press charges. St. Paul informed Zepeda it intended to terminate his employment based on his use of verbal aggression and physical force, including applying pressure to the neck of the patient. At an arbitration hearing, Zepeda testified he was relying on a use-of-force continuum he learned as a military police officer, and he used the minimum amount of force necessary to gain compliance. He admitted he had never been trained on use of pressure points by the city.

The type of case: Under the Minnesota Veteran’s Preference Act, honorably discharged veterans cannot be terminated from public-sector employment except for when incompetency or misconduct are proven at a hearing. Here, the arbitrator found the city had grounds to terminate. Zepeda appealed to the district court, which affirmed the arbitrator’s decision, and then to the Minnesota Court of Appeals.

The issues: Zepeda contended the arbitrator applied the wrong standard of proof in determining his misconduct because the conduct underlying his discharge was treated as potentially criminal. Criminal cases have higher burdens of proof. Zepeda also argued the arbitrator’s findings were factually inconsistent, particularly regarding whether Zepeda’s misconduct was from lack of training.

The court’s ruling: The Minnesota Court of Appeals upheld the arbitrator’s decision, saying if there is no standard of proof specified in the Veteran’s Preference Act, the Legislature intended the preponderance-of-the-evidence standard to apply. This standard requires the city to prove something is more likely than not, versus a higher criminal standard like beyond a reasonable doubt. The court also found there were no inconsistencies in the arbitrator’s findings and that even if there had not been a specific policy to follow, the remainder of Zepeda’s crew, having received the same training, knew not to taunt or abuse a patient.

What this means for cities: Cities do not need to prove employee misconduct beyond a reasonable doubt when seeking to terminate a veteran, even if the behavior that gave rise to the termination formed the basis for a separate criminal investigation. Additionally, cities may be able to show that certain behaviors are prohibited even absent a specific policy.

REAL PROPERTY
Petitions for detachment

Ossawinnamakee Rd. Homeowners v. Comm’r of City of Breezy Point, No. A23-1186 (Minn. Ct. App. Mar. 25, 2024) (nonprecedential opinion)

The facts: A group of 135 property owners, consisting of 51 single family homes, four townhome buildings, and 62 garage or storage units, filed a petition for detachment from the City of Breezy Point. All parcels were zoned R-2, or medium density residential. Breezy Point provides police and public works services, including road maintenance and snow plowing, and contracts with Pequot Lakes Fire Department for firefighting services. The parcels do not receive city sewer or water service.

The type of case: Petitions for detachment are filed with the Office of Administrative Hearings (OAH). Property that is rural in character can be detached from the city when certain conditions are met. Following a hearing before an administrative law judge (ALJ), the petition was denied. The homeowners applied for review in the district court, which affirmed the OAH’s denial, and then this appeal followed.

The issues: While the parties stipulated to several of the requirements for detachment, they disagreed about whether the parcels were rural in character and whether, if the parcels were detached, the city could carry on the functions of government without undue hardship.

The court’s ruling: In upholding the decision of the OAH and the district court, the Minnesota Court of Appeals found the ALJ’s determination that the parcels were not rural was supported by substantial evidence. Almost all the lots were developed with residential structures, one included multifamily housing units and all were zoned medium-density residential. There were 135 property owners in less than 85 acres, and the city provided several services. The court of appeals rejected the homeowners’ assertion that the parcels’ lack of streetlights, sidewalks, gutters, or fire hydrants necessarily rendered them rural.

The appellate court also agreed the city would suffer an undue hardship if the parcels were detached. The ALJ had found the city receives $110,845.40 in property taxes from the parcels, or 4% of the city’s property tax levy. The ALJ also found the lost revenue would equal the loss of two public works employees or one full-time police officer.

What this means for cities: To effectively withstand a petition for detachment, cities should detail both the amount of property tax revenue lost and what the lost revenue represents in terms of the city’s ability to carry out municipal functions. Cities should be mindful there is no statutory definition of “rural” in this context and be able to detail the characteristics of the disputed parcels by referring to factors like zoning and services provided.

Written by Lisa Needham, research attorney with the League of Minnesota Cities. Contact: [email protected] or (651) 281-1271.