Opinion ID: 2122942
Heading Depth: 3
Heading Rank: 4

Heading: Is the Redevelopment Plan Binding on the EDA?

Text: Having concluded that section 469.094 does not apply, we must consider whether there is any other basis to conclude that the EDA exceeded the scope of its authority when it condemned the property owners' property before the EDA had a binding development agreement with a third party. The property owners argue in the alternative that the Redevelopment Plan, adopted by both the EDA and the City Council, is binding on the EDA and that the Plan prohibits the EDA from taking their property without first having a binding development agreement in place. The EDA argues that the Redevelopment Plan is not binding and that even if the Plan is binding, it does not require the EDA to secure a binding development agreement before taking the property owners' property. The EDA argues that the Redevelopment Plan is not binding on it because neither the Plan nor the City Council's resolution adopting the Plan is a modification of the EDA's enabling resolution. The EDA asserts that the enabling resolution demonstrates that it has the power of eminent domain, and that it may exercise that power, absent a modification of the resolution. The property owners argue that the City Council did in fact modify the enabling resolution when it subsequently passed Resolution 01-63 and that those modifications impose compulsory limitations on the EDA. Minnesota Statutes § 469.092, subd. 2, provides that an enabling resolutionthe document that outlines an economic development authority's powersmay be modified at any time, so long as statutory modification procedures in section 469.063 are followed. [4] To modify an enabling resolution, a city council must adopt a written resolution. Minn.Stat. § 469.093, subd. 2. Before adopting such a resolution, a city council must conduct a public hearing, as well as publish a [n]otice of the time and place of hearing, a statement of the purpose of the hearing, and a summary of the resolution in a newspaper of general circulation once a week for two consecutive weeks. Minn.Stat. § 469.093, subd. 1. For at least two reasons, we conclude that the EDA has the stronger argument when it asserts that Resolution 01-63 is not a modification of its enabling resolution. First, nothing in the text of Resolution 01-63 suggests that the City Council intended to modify the EDA's enabling resolution when it enacted Resolution 01-63. Resolution 01-63 does not even mention the enabling resolution, let alone purport to modify the enabling resolution. Rather, it appears that the intent of the City Council in passing Resolution 01-63 was to adopt the Redevelopment Plan and TIF Plan. Resolution 01-63 is titled Resolution Adopting the Redevelopment Plan for the Cedar Grove Redevelopment Area; and Establishing [TIF] District No. 1 Within the Cedar Grove Redevelopment Area; and Adopting the [TIF] Plan Therefor. Resolution 01-63 provides that the EDA and the City propose that the City adopt the [Redevelopment Plan] and establish [TIF] District No. 1. Resolution 01-63 also indicates that all City Council members voted to approve, ratify, establish, and adopt the Redevelopment Plan and TIF Plan. Second, it appears that the City Council did not follow the specific requirements of Minn.Stat. § 469.093 for modifying an enabling resolution. Resolution 01-63 includes a recital claiming that [t]he EDA and City notified Dakota County, Independent School District No. 191, and a county commissioner that there was a public hearing upon published notice, but nothing in the record explicitly demonstrates that notice was given in a manner that conformed to the requirements of Minn.Stat. § 469.093. In fact, the record suggests the City Council did not adhere to section 469.093 requirements. According to an affidavit of publication, the City Council published one public notice article regarding the October 2, 2001 public hearing, rather than one notice per week for two consecutive weeks as section 469.093 requires. In addition, the public notice did not include a summary of the resolution, as section 469.093 requires. The public notice did include a statement as to the purpose of the hearing, but said nothing about modifying the EDA's enabling resolution. Instead, the notice stated that the City Council would hold a public hearing relating to the proposal of the Eagan Economic Development Authority... to adopt the Redevelopment Plan for the Cedar Grove Redevelopment Area [and] to establish [TIF] District No. 1. Based on this record, we find no support for the property owners' assertion that when the City Council adopted Resolution 01-63, it intended to modify the EDA's enabling resolution or that it followed the appropriate procedures to do so. Accordingly, we conclude that Resolution 01-63 is not a modification of the EDA's enabling resolution. Even though we conclude that Resolution 01-63 is not a modification of the EDA's enabling resolution, we disagree with the EDA's assertion that it is not bound by the requirements of Resolution 01-63 and the Redevelopment Plan it adopted. Nothing in chapter 469 or the enabling resolution suggests that the EDA is not required to comply with project guidelines or plans it creates and that the City Council and the EDA adopt. In fact, the EDA's enabling resolution indicates that the EDA should comply with plans that it prepares, adopts, and submits to the City Council for approval because the resolution requires the EDA to submit its plans for development and redevelopment to the City Council for approval. This requirement suggests that the EDA must not only comply with any plan it submits to the City Council if the City Council approves the plan, but also that the EDA's actions and powers can be limited on a project-by-project basis. Further, we believe that if we were to conclude the EDA is not required to comply with the plans that it submits to and has had approved by the City Council, we would render the City Council approval requirement in the enabling resolution meaningless. Moreover, the EDA controlled the creation of the Redevelopment Plan and adopted the Plan. In an EDA resolution passed on August 7, 2001, the EDA stated that it investigated the facts relating to the [Redevelopment Plan] and has caused the Plan[] to be prepared and that it adopted the Redevelopment Plan. The EDA is bound by the resolutions it and the City Council pass. Cf. Mayes v. Byers, 214 Minn. 54, 63, 7 N.W.2d 403, 407 (1943) (A city ordinance within its proper scope has the force and effect of law.). We therefore conclude that Resolution 01-63 and the Redevelopment Plan adopted by that Resolution are binding on the EDA.