Court Opinion

ID: 9740086
Source: CourtListenerOpinion
Date Created: 2023-08-26 20:27:37.750647+00
Date Added: 2024-06-11T07:24:16.123833
License: Public Domain

GILBERT, Justice
(concurring in part, dissenting in part).
I concur that a historical district can include some noncontributing properties and that the standard of review is arbitrary and capricious. However, I respectfully dissent from the majority’s holding that the City did not act arbitrarily or capriciously in this case and would affirm the court of appeals.
This designation procedure hinges on a report (Zellie Report) prepared by the City’s commissioned consultant, Carole *129Zellie (consultant). This consultant studied a section on the southern edge of downtown Minneapolis, where the City’s automotive industry flourished from around the turn of the century to the 1950s. The consultant ultimately recommended that the area be designated a historic district. However, the Zellie Report contains a significant flaw — it ignores the historical and physical change that has occurred in this district since the late 1950s when the auto industry vacated this area. While the Zellie Report concedes that the auto industry era began in 1907 and ended in 1957 with “its dispersal to the suburbs,” the report represents a nostalgic summary of a bygone era and is written as if there had been no change in this area since the 1950s. The Zellie Report carries forward the history of this bygone era without taking into consideration the end of the era and the transformation of the district by the time it was being considered for historical designation.
The current configuration of this district doesn’t even come close to resembling “the hub of the automotive sales district in Minneapolis at the beginning of the 20th Century.” Redevelopment began with the I-94 freeway construction in 1965. Many of the auto-related buildings in this area have also been demolished and replaced by twelve surface parking lots. There are at least seven new buildings within the district, four apartment buildings and three buildings that haven’t been substantially remodeled. The automotive industry was eventually replaced by major educational and religious institutions and multiple housing.
The most significant change in the district came in the “super block” area, which clearly divided the automotive industries’ concentration into two distinct areas. The super block area contains major new structures that now cater to higher education and cover over two square blocks.1 It houses what is now known as the Minneapolis Community and Technical College. Notwithstanding the complete changeover in this two-block area, the consultant recommended that these buildings be included in this historical district. Wisely, the City planning department rejected this part of their expert’s recommendation and excluded this super block from historical designation. As a result, the planning department revision split the district into two portions commonly known as the Fawkes block and the northeast portion.2 It is the northeast portion of the district, which is the subject of this appeal.
Considerable changes have taken place in the northeast section of the district since the late 1950s. For instance, substantial religious institutions emerged in this area. In 1914, across the street from this designated area, the Basilica of St. Mary’s Church was constructed. At the north end is the First Baptist Church. Then, the Northwestern Bible and Train*130ing School was developed here in the 1940s and 1950s. Subsequently, the Billy Graham Association purchased and occupied five buildings in the district beginning in 1950 (buildings 11, 12, 13, 25 and 27). Finally, to complete this cycle, the University of St. Thomas (St. Thomas) campus acquired large portions of the historically designated district and was permitted to demolish five buildings in this area and expanded the downtown campus. This activity began in 2001 and continued through the final historical designation process.
In 1971, the City of Minneapolis zoned the northeast portion high density, multiple residential housing and established the Loring Park Redevelopment District. Thirty-six of the 42 buildings in this area were razed. They were replaced by the Loring Greenway developed in 1976, 43 Greenway Gables town homes in 1980, and the Laurel Village developed in 1986. Four older apartment buildings (buildings 6, 36, 37 and 39) are also part of the northeast section.3 At the time the consultant issued the Zellie Report there was also one hotel in the northeast section (building 26).4
If the City had commenced this historical designation back in 1971, at or about the time the historical district designation was first authorized by the legislature, it might be a different situation. See Act of April 22, 1971, ch. 128, 1971 Minn. Laws 253, 253-54 (codified at Minn.Stat. § 471.193 (1974)). However, after all of this redevelopment activity, only twelve buildings in the northeast portion of this historical district can legitimately be classified as auto industry related (buildings 4, 5, 6, 7, 8, 9, 10, 11, 12, 14, 23 and 36). Although buildings 2, 25 and 37 were designated as contributing, that characterization is inaccurate. Buildings 2 and 39 were demolished by St. Thomas, building 25 underwent extensive renovations, and building 37 is an apartment building. The remaining twelve contributing properties represent less than 30 percent of the surface area of those initially recommended in the northeastern section of the historical district, two of which are apartment complexes (buildings 6 and 36).
As pointed out by a unanimous panel of the court of appeals, the City’s planning commission essentially redrew the boundaries that were recommended by the paid consultant and by the City planning department staff. See Billy Graham Evangelistic Assoc. v. City of Minneapolis, 653 N.W.2d 638, 645 (Minn.App.2002). It is in redrawing these boundaries that the City acted in an arbitrary and capricious manner. First, the inclusion of the Hennepin Avenue properties, buildings 21 though 25, within the district is arbitrary and capricious. The City included the Hennepin Avenue properties within the district despite the planning department’s recommendation to exclude the properties because “[t]his portion of Hennepin Avenue frontage possesses a different character and development potential than the remainder of the district.” See Minneapolis, Minnesota, Code of Ordinances (Code) § 599.280 (2001) (“In making its findings and recommendation, the commission shall consider * * * the city planning commission’s comments”). Moreover, when the Heritage Preservation Commission of the City of Minneapolis (HPC) decided to include the Hennepin Avenue properties *131within the district, it failed to make fold-ings explaining its decision to ignore the planning department’s recommendation and redraw the boundaries. See Code § 599.280 (“[following the public hearing, [HPC] shall make findings with respect to the proposed designation”). Failing to follow procedural guidelines is an indicator that the City acted in an arbitrary manner. See Amcon Corp. v. City of Eagan, 348 N.W.2d 66, 75 (Minn.1984) (“The city’s own comprehensive plan and map designate the property at issue as roadside business. While this designation is not binding, a refusal to zone accordingly is evidence that the city is acting in an arbitrary manner.”). While the zoning and planning committee (zoning) ultimately made written findings justifying the inclusion of the Hennepin Avenue properties, these findings were largely conclusory. Zoning found that two of the five properties are classified as contributing properties and “[including the properties within the historic district will help to preserve the integrity of these buildings and the character of the district.” Such conclusory findings mitigate against a finding that the City acted in a reasonable manner. See Historic Green Springs, Inc. v. Bergland, 497 F.Supp. 839, 850-51 (E.D.Va.1980) (stating that conclusory findings provide minimal insight into whether a decision is arbitrary or capricious).
The arbitrary nature of the decision to include the Hennepin Avenue properties within the district is further illustrated by the fact that the Zellie Report designated only two of the five Hennepin Avenue buildings as contributing. Additionally, both of these “contributing” buildings have lost much of their historical value as they have “undergone varying degrees of alteration, including modernization of windows, redesign of building entrances or blocking of original window openings.” The majority admits that the northeast portion has a “somewhat marginal historic value.” Thus, this “combination of danger signals” — ignoring its own committee’s recommendation, lack of findings and marginal historical value suggest that the City acted arbitrarily when it included the Hen-nepin Avenue properties in the district. See Cable Communications Bd. v. Nor-West Cable Communications P’ship, 356 N.W.2d 658, 669 (Minn.1984) (“The court will intervene, however, where there is a ‘combination of danger signals which suggest the agency has not taken a “hard look” at the salient problems’ and the decision lacks ‘articulated standards and reflective findings.’ ”) (quoting Reserve Mining Co. v. Herbst, 256 N.W.2d 808, 825 (Minn.1977)) (internal citations omitted).
Another indicator that the City acted arbitrarily and capriciously in designating the district historic is that the City bisected building 13 so that it is partially within and partially without the designated district, even though both parts of the building are designated noncontributing. Discussing building 13, the majority concludes that “[w]e are concerned about the sufficiency of the reasons given for the inclusion in the District of only the part of building 13 facing Harmon Place * * * given the somewhat marginal historic value of the northeast portion of the District.” Nevertheless, the majority determines that the City’s bisection of building 13 was rational.
The commission failed to make findings as to why it bisected building 13, or why this decision is rational. The only finding with respect to building 13 was made by the City planning committee that stated buildings 2, 4, 6, 8,10,12, and 13 should be included in the district because all “but one” contribute to the district. However, none of the various government agencies articulated any findings with respect to why building 13, which is located at the *132end of the row and is noncontributing, was included in this group. Additionally, there are not any findings relating to why building 13 was bisected when the entire building is noncontributing. Where an entire building has been designated noncontributing, to designate only one part of the building historic is per se arbitrary, where the City failed to make any findings to justify its decision. Cf. Amcon Corp. v. City of Eagan, 348 N.W.2d 66, 75 (Minn.1984) (holding that “[t]he failure of the city to advance any rationale for not following its comprehensive plan and not granting RB classification is strong evidence of arbitrary action”).
The inclusion of building 13 in the historic district at all is inexplicable considering that the building was constructed in 1980 and in light of the City’s decision to exclude from the district buildings 15 and 17, which are also newly constructed, nonconforming buildings. Accordingly, the City excluded two new properties from the district and included a portion of one new property in the district without articulating a basis in the record to explain why these buildings should be treated in a different manner. Importantly, none of these buildings were associated with the automobile industry in any manner. There is no basis to support this disparate treatment.
The City also acted arbitrarily when during the designation process it allowed St. Thomas to demolish four contributing properties that were originally in the northeast portion (buildings 2, 39, 41 and 42), and then removed the entire parcel owned by St. Thomas from the district. In allowing St. Thomas to demolish buildings, the City treated similarly situated properties differently. As BGEA points out, “[t]he City freed St. Thomas from the restrictions of historic designation but imposed those restrictions [on BGEA].” It is well established that “[a] zoning ordinance must operate uniformly on those similarly situated.” Northwestern College v. City of Arden Hills, 281 N.W.2d 865, 869 (Minn.1979). The majority concludes that BGEA and St. Thomas are not similar because St. Thomas requested a “certificate of appropriateness” instead of challenging the designation of the district. Thus, the majority concludes that “[t]he standards involved in deciding the two questions are divergent and make these property owners dissimilar in the type of relief sought.” However, BGEA and St. Thomas are actually quite similar. They are both nonprofit entities that owned contributing properties within the large district originally proposed by the Zellie Report. Allowing the contributing buildings owned by St. Thomas to be demolished while including similar noncontributing buildings owned by BGEA within the district is per se disparate treatment. Thus, based on this record, the City did act in an arbitrary and capricious manner in treating similarly situated properties differently by allowing the demolition of contributing properties while including noncontributing property.
Finally, although I agree that some noncontributing property can be included within a historical district, those properties should not predominate over contributing properties. Further, noncontributing properties should only be included when they add value or support the architecture of the district. Building 13 adds nothing to the historic or architectural significance of this district. It is a special use, single-user-type of building that has now been stripped of its value and may even be rendered unusable. This arbitrary and capricious action of the City should not be condoned by this court nor should we give our approval to this unbounded exercise of significant governmental power just short of a “taking” in an eminent domain context. The “constrainft]” and “deference” *133the majority accords the City in this appeal amounts to an abdication of our judicial power. The majority’s decision rubber stamps a defective, disparate and improper use of governmental power. If this action by the City is not arbitrary and capricious, what is? We must draw the line somewhere. In doing so, we are not substituting “our own judgment about the historic value of the District” as the majority opinion states, but rather exercising our independent legal judgment to ensure that another branch of government conducts its business according to the law, rather than according to its whim or wishes.

. In 1977, the Minneapolis Technical College was completed at 1415 Harmon. In 1977, the Minneapolis Community College was completed at 1501 Hennepin Avenue. In 1979, the Metropolitan Junior College became the Minneapolis Community College. Furthermore, both the Irene Hixon Whitney Fine Art Center (1989) and the Phillip Helland Center (1986) were opened in this area.

. In splitting this district, the City left the Fawkes block intact. This block had not undergone the same extensive demolition and renovation that has occurred in the balance of the proposed district. In fact, of the original eleven properties in the Fawkes' section, eight of these were designated as contributing properties (buildings 19, 20, 28, 30, 32, 33, 34 and 35). Building number 18 was deemed to be noncontributing because it had been extensively renovated after its original construction in 1946. Building 29 was also deemed to be noncontributing because it was a hotel constructed in 1900 and number 31 was deemed to be noncontributing because it was constructed in 1947, even though it was an addition to building 32, which was indeed part of the Fawkes Auto Company salesroom and garage.

. It appears the Zellie Report included the apartment buildings as contributing properties solely because they had been built between 1907 and 1930 and had "co-existed with the automotive district.”

. Building 26 is outside of the final boundaries established by the City.