Bill Text: MN HF2630 | 2011-2012 | 87th Legislature | Introduced
Bill Title: Regulatory taking compensation provided which do not arise to the level of taking under constitutional analysis, and attorney fee payment authorized.
Sponsorship: Partisan Bill (Republican 1)
Status: (Introduced - Dead) 2012-03-01 - Introduction and first reading, referred to Civil Law [HF2630 Detail]
Download: Minnesota-2011-HF2630-Introduced.html
1.2relating to eminent domain; providing for compensation in regulatory takings
1.3that do not arise to the level of a taking under constitutional analysis; authorizing
1.4payment of attorney fees; proposing coding for new law in Minnesota Statutes,
1.5chapter 557.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. [557.13] REGULATORY TAKINGS COMPENSATED.
1.8 Subdivision 1. Definitions. For the purposes of this section:
1.9(a) "Existing use" means (1) an actual, present use or activity on the real property,
1.10including periods of inactivity that are normally associated with or are incidental to the
1.11nature or type of use; or
1.12(2) activity or reasonably foreseeable, nonspeculative land uses that are suitable for
1.13the real property and compatible with adjacent land uses and that have created an existing
1.14fair market value in the property greater than the fair market value of the actual, present
1.15use or activity on the real property.
1.16(b) "Government action" means a governmental entity's application of a law,
1.17ordinance, rule, policy, or guideline that affects real property, including action on an
1.18application or permit.
1.19(c) "Governmental entity" means the state or a political subdivision of the state, and
1.20any entity that has been granted the power of eminent domain.
1.21(d) "Inordinate burden" or "inordinately burdened" means an action of a
1.22governmental entity that has directly restricted or limited the use of real property such that
1.23the owner is permanently unable to attain the reasonable, investment-backed expectation
1.24for the existing use of the real property or a vested right to a specific use of the real
1.25property with respect to the real property as a whole, or that the owner is left with
2.1existing or vested uses that are unreasonable such that the owner bears permanently a
2.2disproportionate share of a burden imposed for the good of the public, which in fairness
2.3should be borne by the public at large.
2.4"Inordinate burden" or "inordinately burdened" does not mean: (1) temporary
2.5impacts on real property other than a moratorium on development under section 462.355,
2.6subdivision 4, lasting more than one year; (2) impacts on real property occasioned by
2.7governmental abatement, prohibition, prevention, or remediation of a public nuisance at
2.8common law or a noxious use of private property; or (3) impacts on real property caused
2.9by an action of a governmental entity taken to grant relief to the owner of the real property.
2.10In determining whether reasonable, investment-backed expectations are inordinately
2.11burdened, consideration may be given to the factual circumstances leading to the time
2.12elapsed between enactment of the law or regulation and its first application to the subject
2.13property.
2.14(e) "Owner" includes all persons with any interest in the real property subject to a
2.15taking, whether as proprietors, tenants, life estate holders, encumbrancers, beneficial
2.16interest holders, or otherwise.
2.17(f) "Vested right" is to be determined by applying the principles of equitable estoppel
2.18or substantive due process under the common law or by applying the statutory law of
2.19this state.
2.20 Subd. 2. Government action; right to compensation. When a governmental action
2.21inordinately burdens an existing use of real property or a vested right to a specific use of
2.22real property, the owner is entitled to relief, which may include compensation for the actual
2.23loss to the fair market value of the real property caused by the governmental action. This
2.24section provides a cause of action arising out of governmental actions that may not rise to
2.25the level of a taking under the state constitution or the Constitution of the United States.
2.26 Subd. 3. Procedure; notice of claim to governmental entity. Not less than 150
2.27days before filing an action under this section against a governmental entity, an owner
2.28who seeks compensation under this section must present the claim in writing to the
2.29governmental entity. The owner must submit, along with the claim, a valid appraisal that
2.30supports the claim and demonstrates the loss in fair market value to the real property.
2.31If the governmental action is the culmination of a process that involves more than one
2.32governmental entity, or if a complete resolution of all relevant issues, in the view of
2.33the owner or the governmental entity to which a claim is presented, requires the active
2.34participation of more than one governmental entity, the owner shall present the claim
2.35to each governmental entity. The governmental entity shall provide written notice of
2.36the claim to all parties to any administrative action that gave rise to the claim, and to
3.1owners of real property contiguous to the owner's property at the addresses listed on
3.2the most recent county tax rolls.
3.3 Subd. 4. Procedure; settlement offer required. During the notice period, unless
3.4extended by agreement of the parties, the governmental entity shall make a written
3.5settlement offer to effectuate one or more of the following options:
3.6(1) an adjustment of land development or permit standards or other provisions
3.7controlling the development or use of land;
3.8(2) increases or modifications in the density, intensity, or use of areas of development;
3.9(3) the transfer of developmental rights;
3.10(4) land swaps or exchanges;
3.11(5) mitigation, including payments in lieu of on-site mitigation;
3.12(6) location on the least sensitive portion of the property;
3.13(7) conditioning the amount of development or use permitted;
3.14(8) a requirement that issues be addressed on a more comprehensive basis than a
3.15single proposed use or development;
3.16(9) issuance of the development order, a variance, special exception, or other
3.17extraordinary relief;
3.18(10) purchase of the real property, or an interest in the real property, by an
3.19appropriate governmental entity or payment of compensation; or
3.20(11) no changes to the action of the governmental entity.
3.21 Subd. 5. Procedure; statement of allowable uses. During the notice period, unless
3.22a settlement offer is accepted by the owner, each governmental entity provided notice
3.23pursuant to subdivision 3 shall issue a written statement of allowable uses identifying the
3.24allowable uses to which the property may be put. The failure of the governmental entity to
3.25issue a statement of allowable uses during the notice period shall be deemed a denial for
3.26purposes of allowing an owner to file an action in the district court under this section. If a
3.27written statement of allowable uses is issued, it constitutes the last prerequisite to judicial
3.28review for the purposes of the judicial proceeding created by this section, notwithstanding
3.29the availability of other administrative remedies.
3.30 Subd. 6. Procedure; if settlement reached. If the property owner accepts the
3.31settlement offer, the governmental entity may enter into a settlement agreement with
3.32the owner. The settlement agreement must protect the public interest served by the
3.33regulations at issue and be the appropriate relief necessary to prevent the governmental
3.34regulatory effort from inordinately burdening the real property. Whenever a governmental
3.35entity enters into a settlement agreement under this section that would have the effect of
3.36contravening the application of a statute as it would otherwise apply to the real property,
4.1the governmental entity and the property owner shall jointly file an action in the district
4.2court for the county in which the real property is located for approval of the settlement
4.3agreement by the court to ensure that the relief granted protects the public interest served
4.4by the statute at issue and is the appropriate relief necessary to prevent the governmental
4.5regulatory effort from inordinately burdening the real property.
4.6 Subd. 7. Procedure; if settlement rejected. If the owner rejects the governmental
4.7entity's settlement offer and statement of allowable uses, the owner may file a claim for
4.8compensation in the district court for the county in which the property is located, a copy
4.9of which shall be served contemporaneously on each governmental entity that made a
4.10settlement offer and a statement of allowable uses that was rejected by the owner.
4.11 Subd. 8. District court determination of inordinate burden. (a) The district
4.12court shall determine whether an existing use of the real property or a vested right to a
4.13specific use of the real property existed and, if so, whether, considering the settlement
4.14offer and statement of allowable uses, the governmental entity or entities have inordinately
4.15burdened the real property. If the actions of more than one governmental entity,
4.16considering any settlement offers and statement of allowable uses, are responsible for the
4.17action that imposed the inordinate burden on the real property of the owner, the court shall
4.18determine the percentage of responsibility each governmental entity bears with respect
4.19to the inordinate burden.
4.20(b) A governmental entity may take an interlocutory appeal of the court's
4.21determination that the governmental action resulted in an inordinate burden. An
4.22interlocutory appeal does not automatically stay the proceedings; however, the court may
4.23stay the proceedings during the pendency of the interlocutory appeal. The district court's
4.24determination is not final until any interlocutory appeal is concluded. If the governmental
4.25entity does not prevail in the interlocutory appeal, the court shall award to the owner costs
4.26and reasonable attorney fees incurred by the owner in the interlocutory appeal.
4.27 Subd. 9. Jury trial on compensation. If the court determines that governmental
4.28action resulted in an inordinate burden on the private property, and has determined the
4.29percentage of responsibility of each governmental entity, the court shall impanel a jury to
4.30determine the total amount of compensation due to the owner for the loss in value due to
4.31the inordinate burden to the real property. The compensation award shall be determined by
4.32calculating the difference in the fair market value of the real property, as it existed at the
4.33time of the governmental action at issue, as though the owner had the ability to attain the
4.34reasonable investment-backed expectation or was not left with uses that are unreasonable,
4.35whichever the case may be, and the fair market value of the real property, as it existed at
4.36the time of the governmental action at issue, as inordinately burdened, considering the
5.1settlement offer together with the statement of allowable uses, of the governmental entity
5.2or entities. In determining the award of compensation, consideration may not be given
5.3to business damages relative to any development, activity, or use that the governmental
5.4action, considering the settlement offer together with the statement of allowable uses has
5.5restricted, limited, or prohibited. The award of compensation shall include a reasonable
5.6award of prejudgment interest from the date the claim was presented to the governmental
5.7entity.
5.8 Subd. 10. Attorney fees. The court may award costs and reasonable attorney fees to
5.9an owner who prevails in an action brought in district court under this section and incurred
5.10by the owner from the date of filing the district court action if the court determines that the
5.11governmental entity's settlement offer did not constitute a bona fide offer to the owner
5.12that reasonably would have resolved the claim, based upon the knowledge available to
5.13the governmental entity and the owner during the notice period. The court may award
5.14costs and reasonable attorney fees to the governmental entity that prevails in an action
5.15brought under this section and incurred by the governmental entity from the date of filing
5.16the district court action if the court determines that the owner did not accept a bona fide
5.17settlement offer that reasonably would have resolved the claim, based upon the knowledge
5.18available to the governmental entity and the owner during the notice period. Any proposed
5.19settlement offer or any proposed decision, except for the final written settlement offer or
5.20the final written statement of allowable uses, and any negotiation or rejection in regard
5.21to the formulation, either of the settlement offer or the statement of allowable uses,
5.22is inadmissible in the subsequent proceeding established by this section except for the
5.23purposes of the determination pursuant to this paragraph.
5.24 Subd. 11. Alternative dispute resolution. This section does not supplant methods
5.25agreed to by the parties and lawfully available for arbitration, mediation, or other forms of
5.26alternative dispute resolution, and governmental entities are encouraged to utilize methods
5.27to augment or facilitate the processes and actions contemplated by this section.
5.28 Subd. 12. Section 15.99 does not apply. A claim brought under this section is not a
5.29request subject to section 15.99.
1.3that do not arise to the level of a taking under constitutional analysis; authorizing
1.4payment of attorney fees; proposing coding for new law in Minnesota Statutes,
1.5chapter 557.
1.6BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:
1.7 Section 1. [557.13] REGULATORY TAKINGS COMPENSATED.
1.8 Subdivision 1. Definitions. For the purposes of this section:
1.9(a) "Existing use" means (1) an actual, present use or activity on the real property,
1.10including periods of inactivity that are normally associated with or are incidental to the
1.11nature or type of use; or
1.12(2) activity or reasonably foreseeable, nonspeculative land uses that are suitable for
1.13the real property and compatible with adjacent land uses and that have created an existing
1.14fair market value in the property greater than the fair market value of the actual, present
1.15use or activity on the real property.
1.16(b) "Government action" means a governmental entity's application of a law,
1.17ordinance, rule, policy, or guideline that affects real property, including action on an
1.18application or permit.
1.19(c) "Governmental entity" means the state or a political subdivision of the state, and
1.20any entity that has been granted the power of eminent domain.
1.21(d) "Inordinate burden" or "inordinately burdened" means an action of a
1.22governmental entity that has directly restricted or limited the use of real property such that
1.23the owner is permanently unable to attain the reasonable, investment-backed expectation
1.24for the existing use of the real property or a vested right to a specific use of the real
1.25property with respect to the real property as a whole, or that the owner is left with
2.1existing or vested uses that are unreasonable such that the owner bears permanently a
2.2disproportionate share of a burden imposed for the good of the public, which in fairness
2.3should be borne by the public at large.
2.4"Inordinate burden" or "inordinately burdened" does not mean: (1) temporary
2.5impacts on real property other than a moratorium on development under section 462.355,
2.6subdivision 4, lasting more than one year; (2) impacts on real property occasioned by
2.7governmental abatement, prohibition, prevention, or remediation of a public nuisance at
2.8common law or a noxious use of private property; or (3) impacts on real property caused
2.9by an action of a governmental entity taken to grant relief to the owner of the real property.
2.10In determining whether reasonable, investment-backed expectations are inordinately
2.11burdened, consideration may be given to the factual circumstances leading to the time
2.12elapsed between enactment of the law or regulation and its first application to the subject
2.13property.
2.14(e) "Owner" includes all persons with any interest in the real property subject to a
2.15taking, whether as proprietors, tenants, life estate holders, encumbrancers, beneficial
2.16interest holders, or otherwise.
2.17(f) "Vested right" is to be determined by applying the principles of equitable estoppel
2.18or substantive due process under the common law or by applying the statutory law of
2.19this state.
2.20 Subd. 2. Government action; right to compensation. When a governmental action
2.21inordinately burdens an existing use of real property or a vested right to a specific use of
2.22real property, the owner is entitled to relief, which may include compensation for the actual
2.23loss to the fair market value of the real property caused by the governmental action. This
2.24section provides a cause of action arising out of governmental actions that may not rise to
2.25the level of a taking under the state constitution or the Constitution of the United States.
2.26 Subd. 3. Procedure; notice of claim to governmental entity. Not less than 150
2.27days before filing an action under this section against a governmental entity, an owner
2.28who seeks compensation under this section must present the claim in writing to the
2.29governmental entity. The owner must submit, along with the claim, a valid appraisal that
2.30supports the claim and demonstrates the loss in fair market value to the real property.
2.31If the governmental action is the culmination of a process that involves more than one
2.32governmental entity, or if a complete resolution of all relevant issues, in the view of
2.33the owner or the governmental entity to which a claim is presented, requires the active
2.34participation of more than one governmental entity, the owner shall present the claim
2.35to each governmental entity. The governmental entity shall provide written notice of
2.36the claim to all parties to any administrative action that gave rise to the claim, and to
3.1owners of real property contiguous to the owner's property at the addresses listed on
3.2the most recent county tax rolls.
3.3 Subd. 4. Procedure; settlement offer required. During the notice period, unless
3.4extended by agreement of the parties, the governmental entity shall make a written
3.5settlement offer to effectuate one or more of the following options:
3.6(1) an adjustment of land development or permit standards or other provisions
3.7controlling the development or use of land;
3.8(2) increases or modifications in the density, intensity, or use of areas of development;
3.9(3) the transfer of developmental rights;
3.10(4) land swaps or exchanges;
3.11(5) mitigation, including payments in lieu of on-site mitigation;
3.12(6) location on the least sensitive portion of the property;
3.13(7) conditioning the amount of development or use permitted;
3.14(8) a requirement that issues be addressed on a more comprehensive basis than a
3.15single proposed use or development;
3.16(9) issuance of the development order, a variance, special exception, or other
3.17extraordinary relief;
3.18(10) purchase of the real property, or an interest in the real property, by an
3.19appropriate governmental entity or payment of compensation; or
3.20(11) no changes to the action of the governmental entity.
3.21 Subd. 5. Procedure; statement of allowable uses. During the notice period, unless
3.22a settlement offer is accepted by the owner, each governmental entity provided notice
3.23pursuant to subdivision 3 shall issue a written statement of allowable uses identifying the
3.24allowable uses to which the property may be put. The failure of the governmental entity to
3.25issue a statement of allowable uses during the notice period shall be deemed a denial for
3.26purposes of allowing an owner to file an action in the district court under this section. If a
3.27written statement of allowable uses is issued, it constitutes the last prerequisite to judicial
3.28review for the purposes of the judicial proceeding created by this section, notwithstanding
3.29the availability of other administrative remedies.
3.30 Subd. 6. Procedure; if settlement reached. If the property owner accepts the
3.31settlement offer, the governmental entity may enter into a settlement agreement with
3.32the owner. The settlement agreement must protect the public interest served by the
3.33regulations at issue and be the appropriate relief necessary to prevent the governmental
3.34regulatory effort from inordinately burdening the real property. Whenever a governmental
3.35entity enters into a settlement agreement under this section that would have the effect of
3.36contravening the application of a statute as it would otherwise apply to the real property,
4.1the governmental entity and the property owner shall jointly file an action in the district
4.2court for the county in which the real property is located for approval of the settlement
4.3agreement by the court to ensure that the relief granted protects the public interest served
4.4by the statute at issue and is the appropriate relief necessary to prevent the governmental
4.5regulatory effort from inordinately burdening the real property.
4.6 Subd. 7. Procedure; if settlement rejected. If the owner rejects the governmental
4.7entity's settlement offer and statement of allowable uses, the owner may file a claim for
4.8compensation in the district court for the county in which the property is located, a copy
4.9of which shall be served contemporaneously on each governmental entity that made a
4.10settlement offer and a statement of allowable uses that was rejected by the owner.
4.11 Subd. 8. District court determination of inordinate burden. (a) The district
4.12court shall determine whether an existing use of the real property or a vested right to a
4.13specific use of the real property existed and, if so, whether, considering the settlement
4.14offer and statement of allowable uses, the governmental entity or entities have inordinately
4.15burdened the real property. If the actions of more than one governmental entity,
4.16considering any settlement offers and statement of allowable uses, are responsible for the
4.17action that imposed the inordinate burden on the real property of the owner, the court shall
4.18determine the percentage of responsibility each governmental entity bears with respect
4.19to the inordinate burden.
4.20(b) A governmental entity may take an interlocutory appeal of the court's
4.21determination that the governmental action resulted in an inordinate burden. An
4.22interlocutory appeal does not automatically stay the proceedings; however, the court may
4.23stay the proceedings during the pendency of the interlocutory appeal. The district court's
4.24determination is not final until any interlocutory appeal is concluded. If the governmental
4.25entity does not prevail in the interlocutory appeal, the court shall award to the owner costs
4.26and reasonable attorney fees incurred by the owner in the interlocutory appeal.
4.27 Subd. 9. Jury trial on compensation. If the court determines that governmental
4.28action resulted in an inordinate burden on the private property, and has determined the
4.29percentage of responsibility of each governmental entity, the court shall impanel a jury to
4.30determine the total amount of compensation due to the owner for the loss in value due to
4.31the inordinate burden to the real property. The compensation award shall be determined by
4.32calculating the difference in the fair market value of the real property, as it existed at the
4.33time of the governmental action at issue, as though the owner had the ability to attain the
4.34reasonable investment-backed expectation or was not left with uses that are unreasonable,
4.35whichever the case may be, and the fair market value of the real property, as it existed at
4.36the time of the governmental action at issue, as inordinately burdened, considering the
5.1settlement offer together with the statement of allowable uses, of the governmental entity
5.2or entities. In determining the award of compensation, consideration may not be given
5.3to business damages relative to any development, activity, or use that the governmental
5.4action, considering the settlement offer together with the statement of allowable uses has
5.5restricted, limited, or prohibited. The award of compensation shall include a reasonable
5.6award of prejudgment interest from the date the claim was presented to the governmental
5.7entity.
5.8 Subd. 10. Attorney fees. The court may award costs and reasonable attorney fees to
5.9an owner who prevails in an action brought in district court under this section and incurred
5.10by the owner from the date of filing the district court action if the court determines that the
5.11governmental entity's settlement offer did not constitute a bona fide offer to the owner
5.12that reasonably would have resolved the claim, based upon the knowledge available to
5.13the governmental entity and the owner during the notice period. The court may award
5.14costs and reasonable attorney fees to the governmental entity that prevails in an action
5.15brought under this section and incurred by the governmental entity from the date of filing
5.16the district court action if the court determines that the owner did not accept a bona fide
5.17settlement offer that reasonably would have resolved the claim, based upon the knowledge
5.18available to the governmental entity and the owner during the notice period. Any proposed
5.19settlement offer or any proposed decision, except for the final written settlement offer or
5.20the final written statement of allowable uses, and any negotiation or rejection in regard
5.21to the formulation, either of the settlement offer or the statement of allowable uses,
5.22is inadmissible in the subsequent proceeding established by this section except for the
5.23purposes of the determination pursuant to this paragraph.
5.24 Subd. 11. Alternative dispute resolution. This section does not supplant methods
5.25agreed to by the parties and lawfully available for arbitration, mediation, or other forms of
5.26alternative dispute resolution, and governmental entities are encouraged to utilize methods
5.27to augment or facilitate the processes and actions contemplated by this section.
5.28 Subd. 12. Section 15.99 does not apply. A claim brought under this section is not a
5.29request subject to section 15.99.
