The information in this blog is not intended to be legal advice. Postings are for informational purposes only and cannot replace specific legal advice from an attorney.

Friday, July 22, 2011

Cheers to the Mankato Moondogs and Duluth Huskies!

Update your city code! A plethora of new liquor licenses have sprouted this summer, in spite of the state shutdown.

Cities may now issue
an on-sale wine license and an on-sale malt liquor license to a person who owns a summer collegiate league baseball team, or to a person holding a concessions or management contract with the owner. This license allows beverage sales at a ballpark or stadium located within the city during baseball games—notwithstanding any law, local ordinance, or charter provision. Effective date was April 20, 2011. Go Mankato Moondogs, Duluth Huskies, Willmar Stingers, Rochester Honkers, Alexandria Aces!

What other new liquor licenses did the 2011 legislature approve? Lots! As of May 25 of this year, cities have authority under state law to issue all of the following new liquor licenses:

The “Surly bill” authorizes brewer taproom license. A city may now issue one on-sale malt liquor brewer taproom license to the holder of a brewer’s license. This license authorizes sale of malt liquor produced by the brewer for consumption on the premises of, or adjacent to, one brewery location owned by the brewer. Only small brewers (brewing no more than 250,000 barrels of malt liquor annually, or producing no more than 250,000 gallons of wine annually) may receive a brewer taproom license. The license fee, imposed by the city, must cover but generally not exceed the costs of issuing the license, inspecting the premises, and other directly related costs of enforcement. The city must provide the licensee’s name and information to the commissioner of Public Safety within 10 days of issuing the license.

Speedway liquor licenses: Cities may now issue on-sale liquor licenses to auto racing facilities located in the city. The license authorizes sales both to persons attending any and all events at the facility, and sales in a restaurant, bar, or banquet facility located on the premises of the auto racing facility on all days of the week. The license may be issued for a space that is not compact and contiguous, but the licensed premises may include only the space within a defined area as described in the application for the license.

Wine festival license: A city may issue a temporary license to “a bona fide association of owners and operators” of wineries sponsoring an annual festival to showcase wines produced by members of the association. This is an on-sale license authorizing the sale of table, sparkling, or fortified wines produced by the wineries by the glass. However, no more than two glasses per customer may be sold. Dispensing free samples of the wines offered for sale is allowed within designated premises of the festival. The wine festival license is subject to all laws and ordinances governing the sale, possession, and consumption of table, sparkling, or fortified wines. A “bona fide association of owners and operators of wineries” is defined as an association of more than 10 wineries that has been in existence for more than two years at the time of application for the temporary wine festival license.

Temporary farm winery license at county fairs: A city may now issue and charge a fee to a farm winery for a temporary on-sale license for sale of the farm winery’s beverages at a county fair in the city. The farm winery must already have a state issued on- and off-sale farm winery license. The license is subject to all laws and ordinances governing the sale of intoxicating liquor. To be valid, a temporary on-sale farm winery license must first be approved by the commissioner of Public Safety.

Private, nonprofit college liquor license: Notwithstanding any other law, local ordinance, or charter provision, a city may issue an on-sale intoxicating liquor license to a private, nonprofit college located in the city. Alternatively, the city may issue it to any entity holding a caterer’s permit and a contract with the private, nonprofit college for catering on the premises of the private, nonprofit college, or for any portion of the premises as described in the approved license application. The license may be issued for space that is not compact and contiguous, provided that all such space is included in the description of the licensed premises on the approved license application. The license authorizes sales on all days of the week to persons attending events at the private, nonprofit college.

Remember, as a previous excellent blogger noted, the state Liquor Act favors city ordinance regulation of liquor sales. Minn. Stat. § 340A.509 states, “a local authority may impose further restrictions and regulations on the sale and possession of alcoholic beverages within its limits.” As a result, cities may craft a local ordinance regulating the sale of liquor in the city and many related issues - but keeping your code updated allows a city to issue all of these new licenses if the council decides to do so.

Monday, March 14, 2011

Water Conservation Rate Structures in Ordinance

What’s all this buzz about a conservation rate structure and city water? The idea is, the more water you use, the more you pay. A state law tries to make conserving water pay -- and using water cost you more.[i] The law currently requires public water suppliers in the metro area, serving more than 1,000 people, to include a “conservation rate structure” in city ordinances dealing with water rates.

So how does a conservation rate structure work? It’s up to the city water system. Conservation is the key but cities can use a variety of approaches to achieve it.

So what goes into water rates to begin with? To make this a little more fun, think of buying a Twins baseball ticket. Some of your money goes for maintenance and operation of the stadium, a bit of the price of each ticket goes to a sales tax to pay for the stadium itself – and then you pay extra for the best seat in the house.

In the same way, city water rates use volume charges to cover operation and maintenance of the system and a base rate to cover infrastructure costs.[1] After that, a city may use block rates (like that Twins ticket in that primo section behind home plate) where higher water usage puts you into a higher cost bracket for all the water you use. Just as Twins tickets may run a little higher because fans are paying for that new stadium, city water rates vary if a new water plant is being planned or built or paid off.

What are some ways to set a conservation rate? Cities may use a seasonal rate to encourage conservation in the summer when usage skyrockets due to lawn watering. Seasonal rates might include a surcharge or an added fee to discourage constant watering. And, those fees or surcharges might disappear in the winter.

Cities must also consider the number of residential units in an apartment building. Water usage to an apartment building is divided by the number of residential units. If the average amount of water used by each apartment is higher than a residential home, those users, or that building, will pay more too.

Why was this law passed, how is it enforced and when does it take effect? The law seeks to eliminate the practice of charging less the more water you use, which of course, encourages consumption not conservation. Currently, a metro city water system serving more than 1,000 people must have a conservation rate structure in place before it requests approval from the state Department of Health to construct a new public water supply well or requests an increase in the authorized volume of water appropriation. The need to have a conservation rate structure kicks in for all remaining city water systems (including greater Minnesota) serving more than 1,000 people on Jan. 1, 2013.

Monday, February 14, 2011

Hot topic: Can cities regulate private wells?

Let’s talk about wells and city water. Does your city provide water to the community? What if one of the bigger businesses in your city decides to drill their own well, not to use for drinking water (bringing up that word I can never remember how to pronounce – potable, meaning drinkable) but to wash cars or clean equipment? What if, to save money, all the townhouse associations in your city want to drill their own private wells and have the greenest grass on the street?

What can cities do about it? Since 1949 cities have had authority to regulate “the use of wells, cisterns, reservoirs, waterworks, and other means of water supply” in city boundaries. Minn. Stat. 412.221, subd. 11. This authority includes the power to prohibit private wells in a city.

Zoning law provides yet more authority for cities to prohibit private wells or to prescribe areas of the city where private wells may be located on a parcel of property. Minn. Stat. § 462.357, subd. 1. City zoning authority is broad and certainly contemplates regulation of structures including private wells.

Is this news? Yes. In the past few years, cities were receiving letters and calls from the Minnesota Department of Health (MDH) questioning city authority to prohibit or regulate private wells used for irrigation or anything other than drinking water. The confusion stems from laws passed in 1989 that give MDH the authority to regulate the construction, repair and sealing of wells. Minn. Stat. § 103I.111. This ’89 law surely preempts city regulation of these activities – but it does not impinge on a city’s ability to prohibit or regulate well drilling in city boundaries. Lawyers love to split hairs but here we say yes to both city and state regulation. In short, MDH only says HOW to install a well assuming there can be one, and whether there can be one or where a well might be allowed in a city is a city matter.

Why does this matter? Minnesota has more freshwater than any of the other contiguous 48 states.[1] But the supply is not endless. City water systems must protect groundwater supplies and conserve water resources. If all or even a few of the businesses or townhouse associations in your city drill their own wells and use many gallons of water it will quickly cause problems for city water systems.

So what should cities do to protect local water supplies and infrastructure? To protect your city water supply and system, pass an ordinance that deals with private wells. Work with your city attorney to include wells used for irrigation, sprinkling or other uses, not just regulating wells for drinking water. The statutes and case law make it clear that cities have authority to regulate the use of wells to the extent of prohibiting them, and requiring the property owner connect to the city's water system in the interest of health safety and welfare. But remember, the limited tasks of constructing, repairing, and sealing the well are subject to MDH regulatory authority.

Monday, January 31, 2011

Who will board the windows and doors?

Over on Maple Lane there is a house that no one lives in. Maybe it has been foreclosed? Maybe it is a rental that no one wants to rent? It could be any number of things. But one thing that is certain is that when the people left, they did not secure the house. The front door is open. The windows are uncovered and some have been broken. I have seen kids coming and going doing who knows what inside. A couple of times at night I thought I saw lights like someone was staying in there. Once I thought I even saw someone taking a large bundle of something from the house. Apparently the owners are not going to secure the building, so who will?

One option may be for the city to step in and see to it that the building is secured. Minnesota Statute § 463.251 provides a process by which a city can secure a building that is considered hazardous because it is open to trespass and has not been secured. The statute spells out the process to follow and an ordinance is not required to use this process. (See the Dangerous Properties memo for more information.) However, an ordinances is required if the city wants to be able to secure buildings when it presents an immediate danger to the health and safety of persons in the community (e.g. “emergency securing”).

Oftentimes when a city adopts an ordinance that allows for emergency securing of buildings, the ordinance also duplicates the language in state law. It is helpful to spell out who can determine that an emergency exists and the process that will be followed. Here is what the League’s Sample Ordinance Regarding Securing of Vacant Buildings says:


Pursuant to Minn. Stat. § 463.251, subd. 4, when the city building official, police chief, or fire chief determines that an emergency exists with respect to the health or safety of persons in the community and immediate boarding and securing of a building is required, and where immediate danger will exist to children, transients, or others members of the community without the immediate boarding or securing of the building, the building official, police chief, or fire chief may waive all notice requirements herein and immediately board or otherwise secure the building, provided that:

(1) The conditions showing the existence of an emergency are documented in writing by the building official, police chief, fire chief, or their designees.

(2) Notice is mailed immediately by the department invoking this Section to the owner of record of the premises, the taxpayer identified in the property tax records for the parcel, the holder of the mortgage or sheriff’s certificate, and any neighborhood association for the neighborhood in which the building is located that has requested notice.

The model ordinance includes the statutory definitions of “neighborhood association” and “secure,” as well as additional definitions for “unoccupied building,” “unsecured building,” and “vacant building.” These additional definitions are intended to help the city determine when a building is unoccupied, unsecured, or vacant. Having a set definition helps to minimize arbitrary or inconsistent application.

If you already have an ordinance on the books, it is a good idea to review it if you haven’t done so in the last year or so. There were some sizable changes made in 2009 and you want to make sure that your ordinance includes these changes so that it is consistent with state law.

In 2009, Minnesota Statute § 463.251, subd. 2 was amended to include specific information that must be included in the notice that is served on the owner and other specified people. The required written notice must include a statement that:

(1) Informs the owner and the holder of any mortgage or sheriff’s certificate of the requirements that the owner or holder of the certificate has six days to comply with the order or provide the council with a reasonable plan and schedule to comply with the order and that costs may be assessed against the property if the person does not secure the building.

(2) informs the owner and the holder of any mortgage or sheriff's certificate that, within 14 days of the order being served, the person may request a hearing before the governing body challenging the governing body's determination that the property is vacant or unoccupied and hazardous; and

(3) notifies the holder of any sheriff's certificate of the holder's duty under Minnesota Statute § 582.031, subd. 1(b) , to enter the premises to protect it from waste and trespass if the order is not challenged or set aside and there is prima facie evidence of abandonment of the property as described in Minnesota Statute § 582.032, subd. 7.

A couple of other minor changes were made:

· The holder of the sheriff’s certificate of sale has the right to comply with the order or give the council a plan and schedule to comply with the order.

· The right to request a hearing on the order was also added.

· The time line to comply, offer a plan, or request a hearing went from six to fourteen days. In 2010, the legislature went back and changed the time line again, this time from fourteen back to six days.

The League’s sample ordinance includes the law changes from both 2009 and 2010. For more information, please check out the League’s memo “Dangerous Properties.” The subject will also be covered in a session about foreclosed properties in the League's spring Safety and Loss Control Workshops.