Court's Decision to Have Major Impact on Housing Industry
Twin Cities developer Martin Harstad’s suit against the City of Woodbury was heard in the Minnesota Supreme Court today.
Harstad sued the City of Woodbury in 2016, contending the city’s Major Roadway Assessment (MRA) fees, which are used to pay for traffic-related improvements throughout the city, were not permitted under state law. Washington County Court sided with Harstad in 2016, calling Woodbury’s MRA fees “unlawful.” In September 2017, the Court of Appeals upheld a lower court’s ruling.
In November, the League of Minnesota Cities took the unusual step encouraging the Supreme Court to accept Woodbury’s appeal. The Harstad v. Woodbury decision by the Minnesota Supreme Court will have a major effect on the housing industry.
If the Supreme Court upholds the previous rulings, the court would reaffirm the long-held limited taxing authorities of cities as it relates to new development. Should the Supreme Court reverse the lower court decision, cities could gain increased ability to tax new developments and possibly gain the power to withhold development agreements unless developers pay for unrelated road projects requested by the city. A decision from the Supreme Court is expected later this summer.