# Petition for Writ of Certiorari — AVR, Inc. v. City of St. Louis Park

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Petition for Writ of Certiorari
- **Published:** January 1, 1999
- **Citation:** 526 U.S. 1114

## Text

Supreme Court, U.S.
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No. OFFICE Of THE etchs

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Supreme Court of the Hnited States
October Term, 1998

AVR, INC.,
a Minnesota Corporation,
Petitioner,
v.
CITY OF ST. LOUIS PARK.
a Minnesota Municipal Corporation,
Respondent.

ON PETITION FOR A WRIT OF CERTIORARI
TO THE STATE OF MINNESOTA COURT OF APPEALS

PETITION FOR A WRIT OF CERTIORARI

Anthony J. Gleekel

Counsel of Record
Gerald S. Duffy
SIEGEL, BRILL, GREUPNER,

DUFFY & FOSTER, P.A.

100 Wahine Avenue South
1300 es ay Square
Minneapolis, Minnesota 55401
(612) 339-7131

Attorneys for Petitioner

1999 ~ Bachman Legal Printing ® (612) 339-9518 @ 1-800-715-3582 @ Fax (612) 337-8053

QUESTION PRESENTED

Whether a lawful non-conforming use, not considered a
nuisance or prohibited by any precepts of property law, can
be terminated through amortization, without payment of just
compensation under the Fifth Amendment of the United
States Constitution.

eu tian

THE PARTIES

Petitioner is a Minnesota Corporation.
Respondent is a Minnesota Municipal Corporation.

ul

TABLE OF CONTENTS
meer eNIE eee
I one ee tens i
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De er iv
OPINIONS BELOW....................... Ete AO ae TR LOE |
I re ae |
STATUTES AND RULESINVOLVED................ 2
STATEMENT OF THE CASE... ccccccsccsccccsceeseeeeo-. 3
REASONS FOR GRANTING THE PETITION... 9

THE MINNESOTA COURT OF APPEALS’
DECISION ALLO WING TERMINATION OF
A LAWFUL US E OF PROPERTY
FUNDAMENTALLY ALTERS THE
CONSTITUTIONAL RIGHT TO JUST
COMPENS ATION RESULTING FROM A

Somer oe Tere YY... ............... 10
og ETP CE 17
oe abi a te ASSIS ST UROL Aa ee A-i

lil

TABLE OF AUTHORITIES
CASES:
Agins v. Tiburon, 447 U.S. 255 (1980) 0.0... cccscseeeeeeeeeenees 9,12

Apple Valley Red-E-Mix vy. City of St. Louis Park, 359
NW. 20 SAS CG, CA. PRI FB a csesstics ands sanovicascondyechores 3

Armstrong v. United States, 364 U.S. 40 (1960)... 13

AVR, Inc. v. City of St. Louis Park, 585 N.W. 2d 411

CIES, TR, AUS, FRED ce isivcesousineeveccsnaibincinniiaentineatsainns 6
Chicago, B. & O.R. Co. v. Chicago, 166 U.S. 226 (1897).....13
Dolan y. City of Tigard, 512 U.S. 374 (1994)... 912543

First English Evangelical Lutheran Church of Glendale v.
County of Los Angeles, 482 U.S. 304 (1987) ........ ee 12

Keystone Bituminous Coal Ass'n v. De Benedictis,
480. U.S. 470 CSD even ecbarintonrecdibiind dino 12

Lucas v. South Carolina Coastal Council, 505 U.S. 1003
ER isa ii cisnciscaceincis Scosgnbexiaiens ale iemeatees 9-12, 14, 15, 16, 17

Lynch v. Household Fin. Corp., 405 U.S. 538 (1972)........... 11

Naegle Outdoor Advertising Company v. Village of
Minnetonka, 162 N.W. 2d 206 (Minn. 1969) ................04. 7

iV

Ea nl DEAE sla ta elle as Sell als ied’

Nollan v. California Coastal Comm'n, 483 U.S. 825
LEDER bsbincvdtabayisecalsnuccaioiiis colacissacsdeen acs Retin 9, 12,13

Penn Central Transp. Co. v. City of New York, 438 U.S

J

ERPO EAP 1) samisnd Aegud csvussiossusvenkupaesaceccaeasoed bicisiceacccans 10, 12

Pennsylvania Coal Co. v. Mahon, 260 U.S. 393
AUS 5 ROR L SE SRP ier an ohana cee seed Ot Ha PERN OM 10, 15

State v. Apple Valley Redi-Mix, Inc., 379 N.W.2d 136
CAIRO: ADD: IES) ios iisisihicasesauckicdbcs dedeaskcaks 4

Swanson vy. City of Bloomington, 421 N.W.2d 307

CRTNNE SS FO ssi criiscsshaeyntdiidiasssiacn den mec hack es 7

a
9
oS ge a

Petitioner respectfully asks that the Writ of Certiorari be
issued to review the decision of the State of Minnesota Court
of Appeals filed on October 20, 1998. Discretionary review
was denied by the Minnesota Supreme Court in an Order filed
on December 15, 1998.

OPINIONS BELOW

The Minnesota Supreme Court's Order denying review of
the Minnesota Court of Appeals’ decision is unreported but is
included herein at App. A-73. The decision of the Minnesota
Court of Appeals is reported at 585 N.W.2d 411 (Minn. Ct.
App. 1998) and is included herein at App. A-56 through
App. A-72.

The Order Granting Respondent's Motion for
Summary Judgment; Order Dismissing Petitioner's Complaint
of the State District Court (Hennepin County, Minnesota) is
not reported but is included herein at App. A-1 through App.
A-48.

JURISDICTION

The Minnesota Supreme Court's Order denying review of
the Minnesota Court of Appeals’ decision was filed on
December 15, 1998. The United States Supreme Court has
jurisdiction to review the Minnesota Court of Appeals'
decision by Writ of Certiorari pursuant to 28 U.S.C. §1257.

CONSTITUTIONAL PROVISIONS,
STATUTES AND RULES INVOLVED

U.S. Const. Amend. V:

No person shall be held to answer for a capital, or
otherwise infamous crime, unless on a presentment
or indictment of a Grand Jury, except in cases arising
in the land or naval forces, or in the Militia, when in
actual service in time of War or public danger; nor
shall any person be subject for the same offense to
be twice put in jeopardy of life or limb; nor shall be
compelled in any criminal case to be a witness
against himself, nor be deprived of life, liberty, or
property, without due process of law; nor shall
private property be taken for public use, without
just compensation.

STATEMENT OF THE CASE

This case involves the City of St. Louis Park's adoption
of an ordinance terminating Petitioner's lawful use of its
property to house a ready-mix concrete plant. The
prohibition came in the form of a two year amortization
period. The 2.6 acre parcel is surrounded by ccmmercial and
light industrial uses. App. A-3.

The plant was originally constructed in 1954, and became
a legal, non-conforming use in 1959 when the City adopted an
ordinance requiring a special use permit for ready-mix plants
in an industrial zoning district. The ordinance also provided
that no special permits could be granted if a plant were within
400 feet of a residential district. While the Petitioner's
property was zoned industrial, it was located within 400 feet
of a residential district. App. A-3.

In 1973, the City adopted an extensive amendment to its
existing zoning ordinance. The 1973 amendments eliminated
29 industrial uses (including ready-mix plants) in any district
within the City. Petitioner purchased the plant in 1974.
App. A-3.

Petitioner challenged the 1973 zoning ordinance. The
Minnesota Court of Appeals voided the ordinance as it
pertained to the Petitioner's plant, and ruled that Petitioner
was permitted to fully operate its ready-mix facility as a legal
pre-existing, non-conforming use. See Apple Valley Red-E-Mix
v. City of St. Louis Park, 359 N.W.2d 313, 315 (Minn. Ct.
App. 1984). Petitioner continued to Operate, repair and
maintain its plant. App. A-4.

In 1984, the City brought criminal charges against
Petitioner alleging a violation of its air pollution and public
nuisance ordinances for allegedly emitting cement dust. The
Minnesota Court of Appeals struck down the City's

3

ordinance under which Petitioner was charged because the
ordinance set more stringent air quality standards than those
in the Minnesota Pollution Control Act. See State v. Apple
Valley Redi-Mix, Inc., 379 N.W.2d 136, 139 (Minn. Ct. App.
1985). App. A-5.

In 1991, the City filed a complaint against Petitioner
charging Petitioner's plant as a nuisance, alleging violations of
noise limitations under the City's ordinances. The Minnesota
District Court dismissed the City's complaint. App. A-5

In 1990 and 1991, the City's Planning Commission and
City Council held public hearings on City-wide amendments
to the City's Comprehensive Guide Plan. Termination of
certain non-conforming uses using amortization was
considered. The Planning Commission reported that
approximately 200 non-conforming uses would be terminated
as a result of amortization. The City later reduced to 66, the
number of non-conforming uses to be subject to the proposed
amortization. The remaining uses were either multi-family
residential uses or non-residential in nature. The number of
non-conforming uses proposed to be terminated was later
reduced to three properties, the Petitioner's plant, an auto-
salvage yard, and a bar. Eventually the number of non-
conforming uses subject to amortization was reduced to one:
the Petitioner's plant.

In 1992, the City adopted a Comprehensive Zoning
Ordinance. Section 14-7-4 of the Ordinance, which relates to
the amortization on non-conforming uses, provides in relevant
part:

The Council may by ordinance amend the Zoning
Ordinance to establish an amortization period for
individual land uses not permitted in the City. The
amortization period shall commence’ upon

4

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publication of the Ordinance establishing the length
of the amortization period.

App. A-6 to A-7. Again, the Petitioner's plant was the only
use to be terminated. The Ordinance also included the
rezoning of Petitioner's property to multi-family residential.

Following hearings before the City Planning Commission
and the City Council, the City again amended its Zoning
Ordinance, specifically to adopt a two year amortization
period for Petitioner's plant. The Ordinance provided in
relevant part:

The reasonable amortization period applicable to the
ready-mix facility owned and operated by Apple
Valley Red-E-Mix at 3270 Gorham Avenue South.
St. Louis Park, Minnesota, shall be two years,
commencing upon the publication of this Ordinance.

App. A-7 to A-8.

On October 2, 1995, the City Council adopted the
Ordinance. The effective date of the Ordinance was October
11, 1995, with the Petitioner's plant scheduled to close on
October 11, 1997,

The City submitted no empirical or objective evidence,
whether by expert or otherwise, sustaining any finding that
Petitioner's plant created excessive noise, traffic. or dust, or
that the Petitioner's plant was a nuisance or constituted a
noxious or harmful use. The two year period was based for
the most part on the City's conclusion that the Petitioner had
recouped its investment in the subject property since
Petitioner purchased the property in 1974. App. A-67. The
City produced no measurement of the noise or dust emitted
from the plant, but instead relied solely on complaints from

5

residents of one condominium complex built in the early

1980's across the street from the plant. App. A-8 to A-9.
Petitioner, on the other hand, produced several experts

and submitted evidence regarding the denial of the use of the

property, life of the plant, harm to the Petitioner's business if —

the plant closed, climatological data (thwarting the neighbors
concerns about dust), the harmless nature of the plant's
operation, surrounding uses, and, amongst other evidence, the
fact that the property would not be ripe for redevelopment
for several years. The City confirmed that there was no
redevelopment plan for the property or the surrounding area.
App. A-27 to A-28.

By agreement between the parties, the closure of the
Plant was stayed while the Petitioner challenged the
amortization. By order of the State District Court, the plant
closed on February 13, 1999.

Petitioner filed suit against the Respondent on December
22, 1995. After cross motions for summary judgment, the
Minnesota District Court granted the City's motion for
summary judgment by order entered February 20, 1998.
After reviewing the evidence, the District Court concluded
that the City had not acted in an arbitrary, capricious or
unreasonable manner, and that the amortization of the plant
did not constitute a taking of Petitioner's property.

The Petitioner appealed the District Court's decision to
the Minnesota Court of Appeals. By a published opinion
filed October 20, 1998, the Minnesota Court of Appeals

affirmed the District Court's decision. See AVR, Inc. v. City of

St. Louis Park, 585 N.W.2d 411 (Minn. Ct. App. 1998).
App. A-56 to A-72. Petitioner's Statement of the Issues to
the Minnesota Court of Appeals included facial and as-
applied constitutional challenges including that the City's
adoption of a two year amortization period was a violation of

6

Bie et eee wor ee

the Petitioner's constitutional rights to due process, equal
protection and constituted a taking of property without just
compensation. App. A-53 and A-62.

The evidence submitted to the District Court (as
reviewed by the Minnesota Court of Appeals) was the record
before the City at the public hearings before the Planning
Commission and City Council. There was no additional
evidence submitted, as pursuant to Swanson v. City of
Bloomington, 421 N.W.2d 307, 313 (Minn. 1988), tne parties
were prevented from augmenting the record.

On appeal, the Minnesota Court of Appeals affirmed the
District Court's decision. !

The Fifth Amendment taking claim was raised by
Petitioner in its complaint and as an issue on appeal. App. A-
53 and A-62. Both the District Court and the Minnesota
Court of Appeals reviewed the takings claim in their analysis
that the two-year amortization period had not extinguished

‘An issue before the District Court and the Minnesota Court of
Appeals was the reasonableness of the amortization period and whether the
termination over a certain period of time constitutes a taking. The basis of
the Minnesota Court of Appeals’ analysis was the case of Naegle Outdoor
Advertising Company v. Village of Minnetonka, 162 N.W.2d 206 (Minn.
1969). The plaintiff in Naeg/e facially challenged a billboard amortization
ordinance as an unconstitutional taking without just compensation. In
determining the constitutionality of the ordinance, the Minnesota Supreme
Court concluded: "if the value of the plaintiff's property interest was
extinguished before the running of the three-year period, there would be no
taking, or if the value of freedom from new competition from the statutory
period equaled the value of the property interest remaining at the end of the
period, there would be just compensation for the taking.” Naegle, 162
N.W.2d at 213. The Minnesota Supreme Court's constitutional analysis
in Naegle was simple. If the ordinance artificially cuts short the useful life
of the billboard, just compensation was required; and if no useful life
remained, no just compensation was required. Concluding that the
petitioner had recouped its initial investment in the subject property, the
Minnesota Court of Appeals determined that the amortization did not effect
a taking. /d.

the useful life of the plant (as both courts defined that term).
According to the courts, had useful life remained,
compensation for a taking was required. App. A-34 to A-42
and A-65.

REASONS FOR GRANTING THE PETITION

This Court has held that a regulation effects a
compensable taking under the Fifth Amendment if it "does not
substantially advance legitimate state interests [citations
omitted] or denies an owner economically viable use of his
land." Agins v. Tiburon, 447 U.S. 255, 260-61 (1980) and
Nollan v. California Coastal Commission, 483 U.S. 825, 834
(1987).

Insight into the application of the Agins test has recently
been provided by this Court in Lucas vy. South Carolina
Coastal Council 505 U.S. 1003 (1992) and Dolan y. City of
Tigard, 512 U.S. 374 (1994). In Lucas, the Court clarified the
principle that unless the use of property is prohibited by law
or limited by precepts of property law, a taking occurs if the
Agins test is satisfied. Here, in spite of the fact that
Petitioner's plant was held not to be a nuisance or create any
public harm, it was summarily terminated. The period of
amortization was based in large part on recoupment of
Petitioner's investment in the property. The result is denial of
the Petitioner's use of the property (at least until
redevelopment of the surrounding area)* and a regulation that
does not substantially advance a legitimate state interest — as
that concept is defined in Nollan and Dolan.

This Court has not had the Opportunity to address
amortization of non-conformities. This case provides the
Opportunity to address how summary termination of "non-
noxious uses" fits in the paradigm enumerated in Lucas.

’ Petitioner's property will not be the subject of redevelopment for
several years. App. A-28. Petitioner submitted uncontroverted evidence
to the City that the Property was too small to develop as a residential use.

9

THE MINNESOTA COURT OF APPEALS' DECISION
ALLOWING TERMINATION OF A LAWFUL USE OF
PROPERTY FUNDAMENTALLY ALTERS THE
CONSTITUTIONAL RIGHT TO JUST
COMPENSATION RESULTING FROM
A TAKING OF PROPERTY.

The Minnesota Court of Appeals' decision upholding
amortization of the plant without compensation (based on
recoupment of investment), where the plant was lawfully
operating, was not limited by precepts of property law and
did not create a nuisance or cause public harm, ignores this
Court's current statement that when a regulation goes "too far"
it becomes a taking. Pennsylvania Coal Co. v. Mahon, 260
U.S. 393, 415 (1922). This fundamental change in regulatory
taking jurisprudence will allow the summary termination of
any non-conformity without compensation.

Review of the application of the Fifth Amendment to
land use regulation has been approached by this Court on an
ad hoc factual basis:

Nevertheless, our decision in Mahon offered little
insight into when, and under what circumstances, a
given regulation would be seen as going "too far" for
purposes of the Fifth Amendment. In 70-odd years
of succeeding "regulatory takings” jurisprudence, we
have generally eschewed any "'set formula’ for
determining how far is too far, preferring to "engag[e]

in... essentially ad hoc, factual inquiries."

Lucas, 505 U.S. at 1015 (citing Penn. Central Transp. Co. v.
City of New York, 438 U.S. (1978)). This Court has wisely
chosen cases which will provide further insight on the

10

Ee ee a a ee

parameters of the Fifth Amendment as it relates to regulatory
takings. This is another opportunity.

The United States Constitution affords property owners
rights equal to personal liberties. This Court has long
recognized a property owner's rights:

The dichotomy between personal liberties and
property rights is a false one. Property does not
have rights. People have rights. The right to enjoy
property without unlawful deprivation, no less than
the right to speak or the right to travel, is in truth. a
"personal right," whether the "property" in question
be a welfare check, a home, or a savings account. In
fact, fundamental interdependence exists between the
personal right to liberty and the personal right to
property. Neither could have meaning without the
other.
Lynch v. Household Fin. Corp., 405 U.S, 538. 552 (1972).
The protection of property rights arises out of the Fifth
Amendment. This Court has painstakingly defined when, on
the spectrum of property regulation, a regulation justifies
compensation under the Fifth Amendment. In Lucas. the
Court concluded:

Justice Holmes recognized in Mahon, however. that
if the protection against physical appropriations of
private property was to be meaningfully enforced,
the government's power to redefine the range of
interest included in the ownership of property was
necessarily constrained by constitutional limitations.
260 US., at 414-415, 67 L. Ed. 322, 43 S. Ct 158, 28
A.L.R. 1321. If, instead, the uses of private

1]

property were subject to unbridied, uncompensated
qualification under the police power, "the natural
tendency of human nature [would be] to extend the
qualification more and more until at last private
property disappear[ed]." /d., at 415, 67 L. Ed. 322,
43 S. Ct. 158, 28 A.L.R. 1321. These considerations
gave birth in that case to the oft-sited maxim that,
"while property may be regulated to a certain extent,
if regulation goes to far it will be recognized as a
taking.”

505 U.S. at 1014. The Court again in Dolan recognized the
importance of the Takings Clause as it related to other
amendments included in the Bill of Rights:

We see no reason why the Takings Clause of the
Fifth Amendment, as much a part of the Bill of
Rights as the First Amendment or Fourth
Amendment, should be relegated to the status of a
poor relation in these comparable circumstances.

512 U.S. at 392. Insight into the determination of at what
point regulation has gone "too far” has been reviewed by this
Court on several occasions in the past two decades. See Penn
Central Transp. Co. v. City of New York, 438 U.S. 104 (1978);
Agins v. Tiburon, 447 U.S. 255 (1980); Keystone Bituminous
Coal Ass'n v. DeBenedictis, 480 U.S. 470 (1987); Nollan v.
California Costal Comm'n, 483 U.S. 825 (1987); First English
Evangelical Lutheran Church of Glendale v. County of Los
Angeles, 482 U.S. 304 (1987) and Lucas v. South Carolina
Coastal Council, 505 U.S. 1003 (1992); Dolan v. City of
Tigar, 512 U.S. 374 (1994).

12

« ee ee ee oe a ee ee

This case directly presents the issue of whether an
immediate termination of a viable, lawful land use constitutes
a compensable taking under the Fifth Amendment of the
Constitution. While planning authorities have used
amortization as a means to eliminate non-conformities since
the 1950's, state and federal courts vary on the constitutional
impact on the property owner. The regulation of the
Petitioner's property in this case is far more significant than
the regulation of the property owner in Dolan (a building
permit conditioned upon dedication) or Nollan (a building
permit conditioned upon granting a public easement). In both
of those cases, this Court accepted Certiorari, in part, to
determine whether a taking existed as a result of the conditions
to the approvals. Here, the ongoing use of Petitioner's
property was terminated. The Minnesota Court of Appeals’
departure from current regulatory taking jurisprudence must
be rectified.

The Takings Clause of the Fifth Amendment of the
United States Constitution, applicable to the states through
the Fourteenth Amendment, Chicago, B. & OR. Co. y.
Chicago, 166 U.S. 226 (1897), states: "[njor shall private
property be taken for public use without just compensation."
The principal purpose of the Takings Clause is "to bar
government from forcing some people alone to bear public
burdens, which, in all fairness and justice, should be borne by
the public as a whole." Armstrong v. United States, 364 U.S.
40, 49 (1960). In this case, had the City, after 20 years of
failed attempts to eliminate Petitioner's plant, commenced
eminent domain proceedings under relevant state statues,
Petitioner would have faced a physical taking and received just
compensation. The City, on the other hand. to avoid paying
Petitioner for its property, terminated the Petitioner's plant,
forcing the Petitioner to hold the property without any

13

economically viable use (at least until the property and the
surrounding property are ripe for redevelopment). The plant
cannot be converted to another use.

The issue presented in this Petition naturally follows
previous regulatory takings cases as well as provides equally
important insight into when and under what circumstances a
regulation effects a taking. The Petition presents the Court
with a question that has never been before the Court.
Specifically, this Petition gives the Court the opportunity to
decide whether a regulation, immediately terminating a viable,
legal, non-conforming use, denies a property owner all present
economic use of its property, and constitutes a taking. This
case provides an extraordinary circumstance in that one
property owner (one of 200 non-conformities within the
City) is forced to carry the burden of the entire City, requiring
Petitioner to "carry with [it] a heightened risk that [its]
private property is being pressed into some form of public
service under the guise of mitigating serious public harm."
Lucas, 505 U.S. at 1018.

The City's termination of Petitioner's plant conflicts
directly with the Court's holding in Lucas. In Lucas, the
Court clarified the age old precept that "harmful or noxious"
uses may be proscribed by government without the
requirement of compensation. /d. at 1022. Lucas confirmed
that the "noxious use logic [could not] serve as a touchstone to
distinguish regulatory 'takings' - which require compensation
from regulatory deprivations that do not require
compensation." /d. at 1026. To do so, the Court concluded,
would "nullify Mahon's affirmation of the limits to the
noncompensable exercise of police power." /d. Here, the
Petitioner's plant was specifically held not to be a noxious or
harmful use, but was terminated because the Minnesota Court

14

of Appeals held that recoupment of investment was sufficient
to determine whether a taking occurred.

Prohibiting, limiting or eliminating a land use, not
otherwise allowed under law or not part of the owner's title.
will not justify compensation under the Takings Clause. This
concept was clarified in Lucas:

Where the State seeks to sustain regulation that
deprives land of all economically beneficial use, we
think it may resist compensation only if the logically
antecedent inquiry into the nature of the owner's
estate shows that the proscribed use interests were
not part of his title to begin with. [footnote omitted]
This accords, we think, with our "takings"
jurisprudence which has traditionally been guided by
the understandings of our citizens regarding the
content of, and the state's power over, the "bundle of
rights" that they acquire when they obtain title to
property. It seems to us that the property owner
necessarily expects the uses of its property to be
restricted, from time to time, by various measures
newly enacted by the State in legitimate exercise of
its police powers; "[a]s long recognized, some values
are enjoyed under an implied limitation and must
yield to the police power."

Id. at 1027 (quoting Pennsylvania Coal Co. v. Mahon. 260
U.S. at 413). Thwarting the South Carolina Supreme Court's
conclusion that compensation is not required because of its
finding regarding Lucas's ajleged unlawful use of his property,
the Court concluded:

15

Instead, as it would be required to do if it sought to
restrain Lucas in a common-law action for public
nuisance, South Carolina must identify background
principles of nuisance and property law that prohibit
the uses he now intends and the circumstances in
which the property is presently found. Only on this
showing can the State fairly claim that, in proscribing
all such beneficial uses, the Beachfront Management
Act is taking nothing. [footnote omitted]

Id. at 1031-32. Short of prohibition by other means, a
regulation that denies the property owner all economically
viable use, or that does not substantially advance a legitimate
state interest, is a taking.

This case directly conflicts with Lucas because, in spite
of the fact that Petitioner's plant was in use for several years
(not a use to be prohibited) and the City failed on two
occasions to find the plant a nuisance, the Minnesota Court of
Appeals, ignoring federal taking jurisprudence (explicitly that
in Lucas), held that the Fifth Amendment to the Constitution
did not afford the Petitioner compensation. That decision is a
far departure from the current state of the law. This Petition
should be granted to guide courts, property owners and
planning authorities as to if and when amortization effects a
taking. Allowing immediate amortization of a lawful use
based on recoupment of investment will have a wide impact.
[It is hard to imagine a non-conforming use that has not already
recouped its investment.

* Following the Minnesota Court of Appeals decision, one can
conclude that a ready-mix plant less profitable will have more time to
operate.

16

This Petition affords the Court an Opportunity to expand
and clarify the holding in Lucas to determine if the immediate
termination of a lawful use constitutes a compensable taking,
whether permanent or temporary.

CONCLUSION

The Petition for a Writ of Certiorari should be granted to
rectify the departure from regulatory takings jurisprudence
raised by the Minnesota Court of Appeals’ decision.

Respectfully submitted,

Anthony J. Gleekel, #185395
Counsel of Record

Siegel, Brill, Greupner, Duffy
& Foster, P.A.

100 Washington Avenue South

1300 Washington Square

Minneapolis, MN 55401

(612) 339-7131

Attorneys for Petitioner

17

INDEX TO THE APPENDIX

Order Granting Defendant's Motion for Summary
Judgment; Order Dismissing Plaintiff's Complaint
dated January 15, 1998

COTO THERE EEE EHH EEE OTHE EEE EEE E EEE

Notice of Appeal to Court of Appeals dated
March 20, 1998

FORESHORE THEE THEE HEE EEEEEEH EEE EERE HHH E ES

Appellant's Statement of the Case dated
March 20, 1998

POOR TEETH EEE EEE EEE EOE EEE EEE EERE EEE REE EROS

Court of Appeals’ Decision

SPOT TOT THEEHHEEEETEH OTE EOE EEE HEHEHE EEE EOE

Minnesota Supreme Court Order Denying Petition for

Review of Decision of Court of Appeals.................... A-73
City of St. Louis Park Ordinance ........::oi.0.cccicccsiccecessceots A-74

LO he ee ee ie

STATE OF MINNESOTA DISTRICT COURT

COUNTY OF HENNEPIN FOURTH JUDICIAL DISTRICT

AVR, Inc.,

a Minnesota corporation,
ORDER GRANTING
Plaintiff, DEFENDANT'S MOTION
FOR SUMMARY

Vv.

JUDGMENT; ORDER
DISMISSING PLAINTIFF'S

City of St. Louis Park. COMPLAINT

Defendant.
File No. AP 96-182

The above-entitled matter came on for hearing before the
undersigned judge of district court, on the 6th day of August,
1997, upon cross-motions for summary judgment.

Wm. Christopher Penwell, Esq., and Anthony J. Gleekel,
Esq., appeared on behalf of plaintiff; Roger N. Knutson, Esq.,
and Thomas M. Scott, Esq., appeared on behalf of defendant.

Upon all the files, memoranda, the argument of counsel
and the court being fully advised in the premises,

IT IS HEREBY ORDERED:

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That defendant's motion for summary judgment
is granted.

That plaintiff's motion for summary judgment is
denied.

That plaintiff's Complaint is dismissed.

That the attached Memorandum be made a part

hereof.

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LET JUDGMENT BE ENTERED ACCORDINGLY.

Dated this 15" day of January, 1998.

BY THE COURT

Peter Albrecht
District Court Judge

MEMORANDUM
STATEMENT OF FACTS

This action represents the latest of many attempts by
defendant City of St. Louis Park to terminate the operation of
plaintiff's ready-mix facility.’ Defendant St. Louis Park is an
inner ring suburb of Minneapolis with approximately 43,000
residents. Plaintiff Apple Valley Redi-Mix ("AVR"), which
was constructed in 1954, sits on a 2.6 acre parcel at 3270
Gorham Avenue in St. Louis Park. The plant is located just to
the north of Highway 7 and Louisiana Avenue.

In 1959, the City of St. Louis Park enacted a zoning code
which provided, in part, that a ready-mix plant would be
permitted in an industrial zone only if it obtained a special use
permit. The code provided further that the city would not
grant a special use permit if the facility were located within
400 feet of a residential district. The ready-mix facility is
located within 400 feet of a residential district: the City
refused to grant a special use permit. Thereafter, the facility
was Classified as a preexisting nonconforming use.

In 1973, the City adopted an amendment to the zoning
code which implemented changes in policy and industrial land
use designation. The ordinance eliminated 29 industrial uses
that previously had been permitted in the City, including a
ready-mix and concrete block plant. Plaintiff purchased the
plant in 1974, for $260,000.00, when it was already a
nonconforming use under the City’s zoning ordinance.

In 1980, the City adopted a new Comprehensive Plan.
Plaintiff was put on notice that the City intended to phase out
the ready-mix plant.”

' Much of the early history of the dispute between the parties is set
forth in Apple Valley Red-E-Mix v. City of St. Louis Park, 359 N.W.2d

313 (Minn. Ct. App. 1984).

* The 1980 Plan provided, in part:
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In May 1981, AVR engaged in activities at the plant
which were characterized by the City as "improvements." On
November 6, 1981, the City and AVR entered into a
stipulation which would have allowed Red-E-Mix to complete
the improvements, and, if AVR's operation was held to be a
nonconforming use, to vacate the premises within six years.
AVR repudiated the agreement.

AVR brought a declaratory judgment action seeking a
determination that the 1973 zoning ordinance was invalid,
because it eliminated ready-mix plants as a permitted use in
industrial zones. The trial court agreed with AVR. Its
decision was affirmed, as modified, by the court of appeals.”

A commercial area is projected at the southeast corner of Oak
Park Village located on the west side of Louisiana Avenue
north of Highway 7. This site could serve as a convenience
retail and service center or office-type development could be
considered. Drive-in type facilities, fast food restaurants, car
washes, and other similar uses would not be allowed at this
location.

Commercial use is designated on the north side of Walker at
Republic and Gorham Avenues where both commercial and
light industrial uses exist, offering opportunity for smaller
businesses which are characteristically found near downtown
areas but which do not involve outside storage.

No expansion of commercial or industrial type uses is proposed
on Louisiana Avenue, Browndale, or Gorham north of Lake
Street.

Heavy industrial uses including a concrete ready mix plant and
outdoor storage of heavy equipment are to be phased out, and
the sites are to be used for commercial, office, or possibly as a
second choice high density rental use.

Ex. 25 at 17-11 - 17-12.

* On appeal, the City sought to litigate an issue that was not presented
to the trial court; that is, whether AVR's expansion plans violated the code
provisions which prohibit the expansion of nonconforming uses.

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In 1984, in a criminal complaint the City charged AVR
with violating its air pollution and public nuisance ordinances
by allegedly emitting cement dust. The trial court dismissed
the charges against Redi-Mix, because the ordinances at issue
conflicted with the Minnesota Pollution Control Act, Minn.
Stat. § 116.01-.45 (1984) and were therefore invalid.’

In December of 1991, the City of St. Louis Park filed a
complaint in which it charged AVR with ten counts of
violating noise limits (§ 11-509(4)) and one count of making
unnecessary noise (§ 12-703).° The charges originated with
complaints from people who lived across the street from the
plant in an area zoned residential. Neighbors alleged that
AVR's employees had violated the prohibition against making

* The trial court's dismissal of the charges against AVR was affirmed
by the court of appeals. It wrote:

[T]he question is whether the ordinances in issue forbid what
the statute permits. The ordinances do not describe any
quantifiable air quality standard. The ordinances could set a
more stringent air quality standard than the Minnesota Pollution
Control Agency. . . . St. Louis Park could very well prosecute
under its ordinances a party who is in compliance with the
Standards set forth in MPC Act. This conflict renders the
ordinances in issue invalid.

State v. Apple Valley Redi-Mix, Inc., 379 N.W.2d 136, 139 (Minn. Ct.
App. 1985).

“3 11-509(4) Operational Limits for Various Sound Sources. No
person shall engage in, permit or allow construction activities involving
the use of power equipment, manual tools, movement of equipment, or
other activities resulting in noise pollution at any time other than between
7:00 a.m. and 10:00 p.m. on weekdays and 9:00 a.m. and 10:00 p.m. on
weekends and holidays.

§ 12-703 Making Unnecessary Noise. No Person in any public or
private place, shall make, or assist in making, by any manner or means,
any loud, unpleasant or raucous noise or odor disturbing to others unless
the same be reasonably necessary to the preservation of life, health, safety,

Or property.

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loud noises before 7:00 a.m. By Order dated May 7, 1992,
this court dismissed the Complaint against AVR:

The problem with [City of St. Louis Park's]
ordinances in question is that by their very vagueness
(an issue in and of itself, not reached by this Court)
they set a standard that may well be more stringent
than the statute. There is therefore an irreconcilable
conflict between the two, and [AVR's] motion must
be granted.

Order at 3.

In 1992, defendant City of St. Louis Park adopted a
Comprehensive Zoning Ordinance. Section 14:7-4, which
relates to the amortization of nonconforming uses, provided:

Council shall by ordinance amend the Zoning
Ordinance to establish an amortization period for
individual land uses not permitted in the City. The
amortization period shall commence upon
publication of the ordinance establishing the length
of amortization period.

Ex. 28.

Section 14:7-4.1, which related specifically to the
amortization of plaintiff Apple Valley Red-E-Mix, provided:

The reasonable amortization period applicable to the
ready-mix facility owned and operated by Apple
Valley Red-E-Mix at 3270 Gorham Avenue South,
St. Louis Park, Minnesota shall be two (2) years,
commencing upon publication of this ordinance. At
the conclusion of the two-year amortization period,

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iii tiie iad

Apple Valley Red-E-Mix's nonconforming ready-
mix use shall terminate and cease to operate. In
accordance with Minnesota Statutes Section 462-362
and St. Louis Park Ordinance Code Section 14:8-7.1,
this section shall be enforceable by mandamus,
injunction, or any other appropriate remedy in any
court of competent jurisdiction.

In conjunction with its adoption of the 1992 zoning
ordinance and the amortization of AVR, the City made
extensive findings.° Plaintiff, through its attorneys and other

° The city's findings are contained in Ex. 66:
A. Concrete Plants.

53. The City Council finds that Apple Valley Red-E-Mix
at 3270 Gorham is a concrete plant and herein restate and
incorporate Findings | to 52.

54.. The City Council finds the City will realize
significant benefits from terminating concrete or ready
mix plants in the City after a reasonable amortization
period. The benefits, among others are:

a. Residential neighbors will not be disturbed or annoyed by
the noise generated by the concrete plant and trucks that haul
materials to and from the concrete plant.

b. The City's Police Department and Inspections Department
will not receive telephone calls from the residenis of 3300
Louisiana Avenue complaining about dust and noise from
Apple Valley Red-E-Mix will be eliminated. (sic)

c. Heavy truck traffic which causes excessive wear and tear
on the City's streets will be eliminated. The City will have to
spend less time and fewer resources cleaning the street.

d. Problems resulting from dirt, grit and particles from the
cement plant settling on the streets cause City Staff to sweep

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consultants, actively participated in the 1992 zoning
ordinance process, which established the amortization
procedure. The 1992 Zoning Ordinance required a owners of
nonconforming property to register the use with the city no
later than December 31, 1993. The submission of plaintiff
AVR was accepted as substantially complete on June 29,
1995. The City Council and Planning Commission held a
joint public hearing on July 11, 1995, for the purpose of

routinely the streets. This problem and its associated costs will
be eliminated.

e. Eliminating a use that is not permitted anywhere within
the City promotes the City goal to promote and protect against
depreciation in residential property values.

f. Eliminating Apple Valley Red-E-Mix will promote the
quiet peace and enjoyment of the residents living at 3300
Louisiana Avenue.

g. The aesthetics in the neighborhood will improve by
eliminating the existing cement plant.

55. The burden on owners of Apple Valley Red-E-Mix
are:

a. Apple Valley Red-E-Mix may have to relocate its
mixing equipment, if in its judgment, it is cost effective to
move an old plant

b. Apple Valley Red-E-Mix may experience a
temporary loss of income during the relocation of its St.
Louis Park facility unless cement orders from the St. Louts
Park facility are filled by other Apple Valley operations.

56. The City Council finds that the process and
procedures established in the Zoning Ordinance relating to
establishment of an amortization period are adequate to
assure Apple Valley sufficient time to recover its
economic investment will be provided in the structures
and machinery on its property used in connection with its
cement plant operation.

Ex. 66 at 11-12

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adopting an amortization ordinance relating to the AVR
facility. At this meeting, the city presented its report and
recommendation. AVR's attorney, vice president and planner
made oral presentations and submitted documents to bolster
its position that the AVR plant has an indefinite remaining
physical life. City Record, Ex. 39 at 38-115.

The Planning Commission next considered the proposed
amortization of the AVR facility at its regular meeting on
August 2, 1995. City Record, Exs. 21 and 40, including a
Supplemental Staff Report and documents. City Record Exs.
14-18 and 49. The Committee considered all testimony and
submissions related to the proposed amortization submitted
prior to and at the meeting by AVR, as well as additional
written comments submitted by members of the public. The
Planning Commission recommended to the City Council that
a reasonable amortization period for the AVR facility was two
years. City Record, Ex. 40 at 101-02.

At a special meeting on September 13, 1995, the City
Council was presented with an additional staff report,
received additional testimony and written submissions and
considered the proposed AVR Amortization Ordinance based
upon all of the facts, submissions and testimony in the record.
The Council approved the first reading of the AVR
Amortization Ordinance and directed staff to prepare findings
of fact for final action at the time of the second reading of the
ordinance.

On October 2, 1995, the City Council adopted the AVR
Amortization Ordinance. The effective date of the Ordinance
was October 11, 1995, with the AVR plant scheduled to close
on October 11, 1997.

In conjunction with adoption of the AVR Amortization
Ordinance on October 2, 1995. the City Council adopted
Resolution No. 95-131 (City Record, Ex. 42 at 3-5) which
contained the following Findings of Fact supporting its two-
year amortization determination:

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FINDINGS OF FACT

1. The purpose of the City's ordinance providing for the

amortization of nonconforming uses, as stated in St. Louis
Park Code of Ordinances Section 14:7-4A is as follows:
St. Louis Park is a fully developed City and as such, there are
certain uses which are no longer compatible with the nature of
the community. In general, these uses tend to create noise,
traffic, and dust problems and have a negative impact on
property values and aesthetics due to the fact that they are
incompatible with the surrounding area. It is the intent of the
City to gradually eliminate those uses which because of their
location or manner of operation, create a negative impact on
the health and welfare of the neighborhood in which they
exist. To the extent practical and consistent with good land
use planning and zoning principles, the City has made every
effort to accommodate permitting uses in districts where they
are less likely to cause negative impact.

In reaching its conclusion to provide for the gradual
elimination of all nonconforming uses not permitted in any
zoning district in the City, the City Council has weighed the
interests of the individual property owners who will be
required to gradually terminate their nonconforming use and
the health, welfare and safety of the community generally and
the surrounding neighborhoods specifically.

2. With respect specifically to AVR, the City Council
made ten specific findings in connection with the adoption of
the City's comprehensive zoning ordinance in 1992 as to the
operation of the AVR facility and application of the
Amortization Ordinance to that facility.

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3. The Minnesota Supreme Court has directed, in the
Naegele Outdoor Advertising Co. of Minnesota v. Village of
Minnetonka decision, that any amortization period must be
"reasonable." Courts in other jurisd.ctions have identified at
least seven (7) factors by which the reasonableness of an
amortization period may be evaluated. The St. Louis Park
Code of Ordinances incorporates those specific factors in its
Amortization Ordinance. The City's Amortization Ordinance
specifies that the following factors must be considered in
determining the length of an amortization period:

(1) Information relating to the structure located on
the property;

(2) Nature of the use:

(3) Location of the property in relation to the
surrounding uses;

(4) Description of the character of and uses in the
surrounding neighborhood;

(5) Cost of the property and improvements to the
property;

(6) Benefit to the public by requiring the
termination of the nonconforming use:

(7) Burden on the property owner by requiring the
termination of the nonconforming use;

(8) The length of time the use has been in existence;
and

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(9) The length of time the use has_ been
nonconforming. :

4. The Minnesota Supreme Court has approved, in the
Naegele decision, the use of amortization as a procedure for
the elimination of the nonconforming use, and the City has
exercised its discretion consistent with a _ reasonable
application of the law and after due consideration of the
evidence relating to the factors set forth in paragraph 3.

Factor (1): Information relating to the structure

located on the property.

5. There are two structures located on the AVR
property associated with the ready-mix operation, including
an industrial shed (garage and shop) and the batching plant.
The construction type of both structures is industrial steel and
masonry, and both structures have steel exterior walls [on]
which rust is evident. The industrial shed measures 133.55’ x
60', with 8,013 square feet of floor area. (The floor area of
the batching plant is in dispute. City Assessor's records show
that the batching plant has 1,417 square feet of floor area,
while AVR's appraisal states that the batching plant has 3,506
square feet of floor area. This dispute does not appear to be
material for purposes of the amortization period established
herein.)

6. AVR proposed in 1986 to completely replace the
existing two structures with what it characterized as a "state
of the art" ready-mix plant. The city denied AVR's request as
a violation of its City Code, because the City Code prohibited
the expansion or intensification of a nonconforming use.

Factor (2): Nature of the use.

7. The AVR facility manufactures ready-mix - concrete
by mixing aggregate that is trucked from the Apple Valley
gravel pit and loaded into the cement mixer by conveyer belt,
where it is mixed with cement, fly ash, and water before being
loaded into cement mixing trucks for transportation to
construction sites.

8. The batching plant includes a gravity flow tower that
is approximately 60-70' tall and is highly visible from the
surrounding residential neighborhood. The buildings do not
meet the City's current architectural] standards for any Zoning
District, even the industrial zoning districts, due to the
unfinished steel exteriors on the Structures. As the steel
continues to rust, the aesthetics will continue to decline,
resulting in a potential diminution of the value of the
surrounding property.

9. The ready-mix use cannot be conducted within an
entirely enclosed building and high volumes of heavy truck
traffic delivering aggregate from the gravel pit and
transporting ready-mix to construction Sites are a necessary
part of the use. The noise, dust, traffic, and other features
incident to the ready-mix operation are thus largely
unavoidable while the facility is Operating. Those features
conflict and are incompatible with residential uses, including
the residential properties immediately adjacent to and across
from the facility.

10. Testimony from residents indicated substantial noise
generated by the facility which may result from cleaning of
trucks or aggregate being unloaded as well as Saturday noise.
AVR acknowledged that Processing begins as early as 6:00
a.m. and submitted information at the request of City Staff

A-13

that Saturday operations at the AVR St. Louis Park Facility
have increased in the last five years, with the Facility
operating 25% of all Saturdays in 1994 and 50% of the
Saturdays during the months of June and July when residents
most want to enjoy their patios or have windows open.

Factor (3): Location of the property in relation
to surrounding uses.

11. The neighborhood that includes AVR has changed
substantially since the ready-mix plant was constructed in
1954. At that time, the area was zoned for industrial uses and
was much more industrial in character than it is today.
Redevelopment in the area since 1954, and even since AVR's
acquisition in 1974, has been substantial and consistent with
the City's Comprehensive Plan and zoning policy direction.

12. The facility became a nonconforming use on or about
February 5, 1960, the effective date of a new zoning
ordinance. Under the 1960 ordinance, ready-mix and concrete
block plants were permitted in the I-1 Industrial Use Zoning
District only (1) by special permit and (2) only if the plant
was located more than 400 feet from any residential use. The
facility was located within 400 feet of a residential use to the
east and, thus, AVR did not meet the criteria for a special use
permit.

13. At present, the area that includes AVR is in the
process of redeveloping, and the ready-mix facility is now
surrounded by Residential and Commercial Use Districts that
contain the Park Tavern Restaurant, the "3300 on the Park"
condominium complex, the Oak Park Village townhomes, and
a single-family neighborhood that includes a small City park
and a public library. In addition, redevelopment plans for the

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areas immediately surrounding AVR emphasize construction
of additional multiple-family residential housing.

14. The ready-mix use is fundamentally incompatible
with existing and planned uses and with the City's zoning and
Oak Hill Neighborhood Comprehensive Plan.

Factor (4): Description of the character of and uses
in the surrounding neighborhood.

15. AVR is surrounded by a. stable single-family
residential neighborhood to the east, three businesses of
primarily office or quasi-industrial character to the north,
none of which apparently involve industrial activity similar to
AVR's use and in any event do not involve outdoor processing
activities; a vacant building that formerly was used by a
security company, immediately to the south: a multiple-family
residential neighborhood to the west across Louisiana
Avenue; and, to the southwest a restaurant that serves both the
single-family residential neighborhood to the east of AVR as
well as the multiple-family residential neighborhood to the
west.

16. Other existing, small commercial uses in the vicinity
do not present the intense conflicts with the neighborhood and
surrounding residential development and redevelopment that
the AVR ready-mix facility does.

Factor (5): Cost of the property and improvements
to the property.

17. AVR purchased the ready-mix facility from
Suburban Ready-Mix in 1974 for $260,000.00 and AVR was
or should have been aware of its nonconforming use status at
the time it purchased the facility. Suburban Ready-Mix had

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operated the facility for almost twenty (20) years, and AVR
has operated it for the last twenty (20) years. AVR
acknowledges that the original investment is_ fully
depreciated.

18. Based upon information reported by AVR,
subsequent improvements to the property — totaled
$123,168.00. AVR's remaining non-depreciated investment in
the ready-mix facility is approximately $40,000.00 as of
January 1, 1995, while its annual income allocable to this
Facility is almost $200,000.00.

Factor (6): Benefit to the public by requiring
termination of the nonconforming
use.

19. Elimination of AVR's heavy industrial structures.
[sic] including the highly visible 60 to 70-foot batching plant
tower, would improve ihe quality of life of nearby residents
and business people who view the facility daily from their
properties. Elimination of these structures, which do not
conform to the City's architectural standards also would
improve the general appearance and image of the area.
Aesthetics contribute to the quality of life.

20. Numerous complaints have been received over the
years regarding traffic, noise and dust generated by AVR.
Elimination of the use would eliminate such complaints and
would thereby save time and effort by City employees and
costs for City taxpayers.

21. Redevelopment activities may accelerate after the
termination of AVR's nonconforming use, and may make the
property available for different uses consistent with the City's
Comprehensive Plan and the zoning ordinance.

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22. Elimination of the ready-mix facility and the
associated redevelopment of the AVR property could feasibly
increase property values in the immediate vicinity of AVR by
providing more aesthetic views and decreased traffic, noise,
and dust for neighboring single-family and multiple-family
residential developments. Increased property values would
translate into increased real estate tax generation, providing a
benefit for the entire City.

23. Elimination of the substantial heavy truck traffic to
and from AVR, which often occurs during peak automobile
use times, would improve the quality of life for residents,
users of the nearby City park, and customers of the
neighboring commercial areas, by eliminating traffic, noise,
and dust that are incident to the operation of heavy industrial
trucks.

Factor (7): Burden on the property owner by
requiring the termination of a
nonconforming use.

24. AVR was or reasonably should have been aware of
the nonconforming status of the ready-mix facility when it
purchased the facility in 1974. Over the ensuing 21 years,
AVR has fully depreciated and recaptured its initial
investment.

25. AVR will have to terminate its ready-mix operation
in St. Louis Park. As a result, AVR will lose the advantages
of the monopolistic position that the nonconforming facility
has enjoyed throughout AVR's ownership of it.

26. AVR has asserted a number of difficulties it expects
to encounter upon termination of its nonconforming use, but

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has not provided factual support for its contentions. Many of
the difficulties it suggests will occur from the termination
would be a direct result of the loss of the favorable market:
position it enjoys due to its nonconforming status. AVR's
suggested “burdens” fail to adequately address the existence
and market position of its other facilities in and around the
seven-county metropolitan area.

27. The definition of "market area" and the purported
results of AVR's relocation search conflict with data presented
by City Staff concerning the relevant market area and the
availability of possible sites for relocation in metropolitan
area cities. Further, AVR has failed to include acquisition of
an existing ready-mix facility among its replacement options.
AVR has not demonstrated to the satisfaction of the City
Council, that it made reasonable efforts to relocate or to
identify all relocation options, in spite of its awareness that
competitors were taking advantage of relocation and
upgrading opportunities during the 1980's. The amortization
period also allows AVR an additional two (2) years to
relocate and/or adjust its operations.

28. AVR has profited from the nonconforming status of
its St. Louis Park facility. AYR has failed to relocate to a
conforming site on its own initiative despite having full
opportunity to do so for more than twenty (20) years. To the
extent that AVR has benefited from the monopolistic
advantage it has enjoyed because of its nonconforming status
since 1974, rather than relocate its facility, any burden that
may be imposed on AVR by the two-year amortization period
is in part a self-imposed burden.

29. While the City does not necessarily agree with
AVR's apparent view that relocation is impossible and has
been impossible for some time, to the extent that the City

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were to adopt such a view, it would tend to reinforce that
AVR's nonconforming use in St. Louis Park has for some
time enjoyed an advantageous market position which has
substantially benefited AVR, allowing it to fully recapture its
investment in the facility.

30. Based upon a reasonable 15-mile service radius for
each of its facilities, continued operation of the St. Louis Park
AVR Facility is not critical to the overall AVR ready-mix
business, because the market area of the St. Louis Park AVR
facility is almost entirely duplicated by four of AVR's other
facilities.

31. AVR has not proven that it cannot relocate or that it
has made reasonable efforts to do so. Information submitted
by AVR indicates that its search considered potential sites
that were significantly larger in size than the present site, and
that AVR did not consider acquiring an existing ready-mix
plant among its relocation options.

32. Even though AVR will have to discontinue its
nonconforming use in St. Louis Park at the end of the
amortization period, AVR will still own the property on
which the ready-mix plant is constructed. At the end of the
amortization period, AVR will be free to use the property for
use that is permitted under the current zoning designation.

Factor (8): The length of time the use has been
in existence.

33. Suburban Ready-Mix established the ready-mix plant
on the current site in 1954 and operated it until AVR took
Over the operation in 1973. AVR purchased the ready-mix
plant in February, 1974, and has operated a ready-mix facility

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on the property since that time. The ready-mix use thus has
been in existence since 1954, i.e. for 41 years.

Factor (9): The length or time the use has been
nonconforming.

34. The ready-mix plant became a _ pre-existing
nonconforming use on or about February 5, 1960, the
effective date of a new zoning ordinance adopted by the City
on December 28, 1959. Under that ordinance, the property on
which the ready-mix plant was constructed was included in an
I-1 zoning district. Ready-mix plants were permitted in the I-
| district only (1) by special permit and (2) if the plant was
not within 400 feet of a residential use. The facility was
within 400 feet of a neighboring residential property, so,
unable to obtain a special permit, the ready-mix facility
became a pre-existing nonconforming use on or about
February 5, 1960, and has remained so for the intervening 35
years.

Other factors and considerations

36. To assist it in determining the length of a reasonable
amortization period for AVR’s St. Louis Park facility,
including evaluating the useful life of the facility, the City
retained the accounting firm of Arthur Andersen & Company
("Arthur Andersen"), and the appraising firm of Patchin &
Associates, Inc. ("Patchin"). The City Council finds that
Arthur Andersen [was] qualified to advise it on matters
related to accounting and to provide an expert opinion on
which the City may reasonably rely. The City Council further
finds that Patchin 1s qualified to advise it on property
valuation matters and to provide an expert opinion on which
the City may reasonably rely.

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37. Arthur Andersen has advised the City that the useful
life of AVR's St. Louis Park facility has expired. Specifically,
Arthur Andersen found that, under Generally Accepted
Accounting Practices ("GAAP"), the facility's useful life
expired no later than 1994, Additionally, Arthur Andersen
found that, under management cost recovery methods, AVR
has fully recovered its investment in the St. Louis Park facility
and has earned a return on its investment of approximately
560 percent. Arthur Andersen further opined that the use of
GAAP and management cost recovery methods could provide
the City with evidence of a reasonable amortization period.

38. Patchin has advised the City that the appraisal
submitted by AVR is inadequate for use in the amortization
process and has urged the City not to use it as a basis for
determining the reasonable amortization period to be applied
to the St. Louis Park facility.

39. Based upon the expert opinions of Arthur Andersen
and Patchin, the age of the St, Louis Park facility, AVR's
proposal to the City nine years ago to replace the existing St.
Louis Park structure, AVR's testimony regarding necessary
size of potential relocation sites, and the voluntary relocation
and/or new construction actions of other ready-mix businesses
in the Twin Cities area, AVR’s St. Louis Park Facility has
passed its useful life and AVR has had a reasonable
opportunity to recover its economic investment.

40. Consideration by the City Council of, and any
findings made by the City Council related to the generation by
AVR of noise and dust or other types of pollution, to the
extent the City Council considered or made findings related to
such generation, individually and collectively constitute
additional justification and grounds upon which the City
Council determined the reasonable amortization period

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applicable to AVR. Even in the absence of such
consideration and findings, the amortization period
determined herein to be applicable to AVR is reasonable
based upon the other evidence in the record.

41. No single factor considered by the City Council is
necessarily determinative of the length or reasonableness of
the amortization period to be applied to AVR. Each of the
individual factors evaluated by the City Council, however,
was considered independent of the other factors and may, in
conjunction with any additional factor or factors considered,
provide sufficient and rational basis for the determination of
the appropriate and reasonable amortization period.

42. The City Council believes that its determination of a
reasonable amortization period for AVR, and adoption of that
amortization period through amendment of the City's zoning
ordinance in accordance with Ordinance Code Section 14:7-
4(D)(4), constitutes a legislative decision as the Minnesota
Supreme Court has defined and described that concept in its
1981 decision in Honn v. City of Coon Rapids. AVR has
contended that the determination and adoption of a reasonable
amortization is instead a quasi-judicial decision. Regardless
of whether the City Council's determination and adoption of
the reasonable amortization period applicable to AVR is a
legislative or a quasi-judicial decision, or some hybrid of the
two, the findings set forth herein to support the amortization
period applied to AVR through an amendment to the City's
zoning ordinance is hereby determined by the City Council to
be reasonable based on the record before it.

A-22

EAS Ce eee ee Fee he

aid Ns ia hain ae a ah eine
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DISCUSSION
I. Summary Judgment Standard

The trial judge is authorized to grant summary judgment
under Minn. R. Civ. P. 56.03 "if the pleadings, depositions,
answers to interrogatories, and admissions, together with
affidavits on file, if any, show that there is no genuine issue of
material fact and that either party is entitled to judgment as a
matter of law." Id. While summary judgment is intended to
secure a just, speedy, and inexpensive disposition, it is not
designed as a substitute for a court or jury trial where there are
material factual issues to be determined. Vieths v. Thorp Fin.
Co., 305 Minn. 522, 232 N.W.2d 776 (1975). Minnesota
courts interpret a material fact as one which will affect the
result or outcome of the case. depending upon its resolution.
Zappa _v. Fahey, 310 Minn. 555, 245 N.W.2d 258 (1976).
“[SJummary judgment is proper when the non-moving party
fails to provide the court with specific facts indicating that
there is a genuine issue of material fact." Hunt v. IBM Mid
America Employees Fed. Credit Union, 384 N.W.2d 853, 855
(Minn. 1976); see also Kletschka v. Abbott-Northwestern
Hospital, 417 N.W.2d 753, 754 (Minn. Ct. App. 1988). A
genuine issue is not technical, sham or frivolous. A & J
Builders, Inc. v. Harms, 288 Minn. 124, 179 N.W.2d 98
(1970).

The party opposing summary judgment “must do more
than simply show that there is some metaphysical doubt as to
the material facts." Matsushita Electrical Industrial Co. v.
Zenith Radio Corp., 475 U.S. 574, 586 (1986). Whether a
genuine issue of material fact is presented is determined by
asking if "a reasonable jury could return a verdict for the non-
moving party." Anderson v. Liberty Lobby, Inc., 477 U.S.

242, 248 (1986).

On a motion for summary judgment, the non-moving
party has the burden of establishing the existence of every
element essential to its case and on which it will bear the
burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S.
317, 322 (1986). Such evidence and all justifiable inferences
that can be drawn from it are to be taken as true. Anderson,
477 U.S. at 255. However, if the non-moving party fails to
establish an essential element of its claim, the moving party is
entitled to a judgment dismissing that claim as a matter of
law. Celotex, 477 U.S. at 322-23.

The parties have stipulated that this case is to be decided
based upon this court's review of the record pursuant to
Swanson v. City of Bloomington, 421 N.W.2d. 307 (Minn.
1988). "The standard of review is whether the municipal
body's decision was unreasonable, arbitrary or capricious,
with review focused on the legal sufficiency of and factual
basis for the reasons given.” Id. at 313.

Il. Zoning Decisions are Legislative, Not Quasi-
Judicial.

The City presented a rationale for its amortization
ordinance.’ Whether or not AVR has a legitimate quarrel
with the wording of the ordinance or the purity of its aims is

7 ‘ : « . < .
The purpose of the amortization ordinance is set forth as follows:

St. Louis Park ts a fully developed city and as such, there
are certain uses which are no longer compatible with the
nature of the community. In general, these uses tend to
create noise, traffic, and dust problems and have a
negative impact on property values and aesthetics due to
the fact that they are incompatible with the surrounding
area. It is the intent of the City to gradually eliminate
those uses which because of their location or manner of
operation, create a negative impact on the health and
welfare of the neighborhood in which they exist.

A-24

insignificant in terms of this court's ability to overturn it.
Because zoning is legislative in nature, the standard of review
is the reasonableness of the municipal body's action. That
principle has not been successfully challenged in any
applicable holdings set forth in caselaw.

Our case law distinguishes between zoning matters
which are legislative in nature (rezoning) and those
which are quasi-judicial (variances and special use
permits). Even so, the standard of review is the same
for all zoning matters, namely whether the zoning
authority's action was reasonable. Our cases express
this standard in various ways: Is there a "reasonable
basis" for the decision? or jis the decision
"unreasonable, arbitrary or capricious"? or is the
decision "reasonably debatable"?

Honn_v. City of Coon Rapids, 313 N.W.2d. 409, 416-17
(Minn. 1981).

Courts in other Minnesota cases have concluded likewise,
and the language with which they have done so is practically
uniform. For example, in St. Croix Development, Inc. v. City
of Apple Valley, 446 N.W.2d 392 (Minn. Ct. App. 1989), the
court, in upholding a zoning ordinance, echoed the oft-
repeated mantra of judicial non-interference. It Stated:

The standard of review in all zoning matters is
whether the local authority's action was reasonable.
Van Landshoot v. City of Mendota Heights, 336
N.W.2d 503, 508 (Minn. 1983). “The court's
authority to interfere in the management of
municipal affairs should be limited and sparingly
invoked." White Bear Docking and Storage. Inc. v.
City of White Bear Lake. 324 N.W.2d 174, 176

A-25

(Minn. 1982). The mere fact that a court might have
reached a different conclusion, had it been a member
of the council, does not invalidate the judgment of
the city officials if they acted in good faith and
within the broad discretion accorded them by statute
and ordinance.

St. Croix Development, at 397-98.

In a case that bears significant similarities to the case at
bar, State, by Rochester Association of Neighborhoods v. City
of Rochester, 268 N.W.2d 885 (Minn. 1978), the court
emphasized its traditional minimal role in oversight of zoning
decisions:

As a legislative act, a zoning or rezoning
classification must be upheld unless opponents prove
that the classification is unsupported by any rational
basis related to promoting the public health, safety,
morals, or general welfare. In other words, the test is
a “rational basis” test. A city council has broad
discretion in legislative matters, and even if the city
council's decision is debatable, so long as there is a
rational basis for what it does, the courts do not
interfere.

268 N.W.2d at 888: see also Beck v. City of St. Paul, 304
Minn. 438, 448, 231 N.W.2d 919, 925 (1975).

In addition to, and aside from, the above quote (which
this court has already stated could have been excerpted from
any of perhaps a dozen decisions of this type), State, by
Rochester Association of Neighborhoods is significant for a
specific reason. In that instance, the court held that the city's
action in rezoning a single 1.18-acre tract, (single family and
low-density residential to high-density residential) in order to

A-26

Pore ocin ks (SG aa

facilitate construction of a 49-unit condominium project, was

properly upheld as a valid exercise of its police power,

"unless the opponent proved that it was unsupported by any

rational basis related to promoting public health, safety,
, morals, or general welfare.” Id. at 885. In State, by
Rochester, as in the case at bar, plaintiff urged the court to
draw a distinction between comprehensive zoning ordinances
and those which involved a Single tract of land, arguing that
the latter deserved close judicial scrutiny as an administrative
or quasi-judicial act. The court refused. It wrote:

We decline to follow the rule [subjecting a zoning
decision to close judicial scrutiny where only a small
parcel was affected] for we have consistently held
i that "when a municipality adopts or amends a zoning
ordinance, it acts in a legislative capacity under its
delegated police powers." Beck v. City of St. Paul,
304 Minn. 438, 448, 231 N.W.2d 919. 925 (1975).
This rule applies regardless of the size of the tract
of land involved. See, e.g.. Sun Oil Co. v. City of
| New Hope, 300 Minn. 326, 333. 220 N.W.2d 256,
261 (1974).

il

State, by Rochester, at 887. (Emphasis added).

In Sun Oil, where the tract of land involved consisted of
only one acre, the court wrote, "Even where the
| :
reasonableness of a zoning ordinance is debatable, or where
: there are conflicting opinions as to the desirability of the
restrictions it imposes, . . . it is not the function of the courts
to interfere with the legislative discretion on such issues."
300 Minn. at 334, 220 N.W.2d at 261.

Contrary to AVR's argument, und consistent with the
court's analysis in State. by Rochester, rational review does
not require the City to present evidence that implementation

A-27

of its overall development plan is imminent.® Where courts
have had the opportunity to place restrictions on a
municipality's legislative powers based upon distinctions such
as the progress that the city had already made toward overall
implementation, they have not done so.

Even if defendant could have been more charitable in its
description of AVR's facility as an "old rust bucket,” courts
are no more anxious to invalidate an ordinance which reflects
a desire to improve the aesthetics of a neighborhood than they
are to invalidate an ordinance which is passed to aid in the
pursuit of any other aim. In Naegele Outdoor Advertising Co.
v. Village of Minnetonka, 281 Minn., 492, 499, 162 N.W.2d
206, (1968), the court wrote:

The mere fact that the adoption of a zoning
ordinance reflects a desire to achieve aesthetic ends
should not invalidate an otherwise valid ordinance.
Thus, if the challenged restriction is reasonably
related to promoting the general welfare of the
community or any other legitimate police power
objective, the fact that aesthetic considerations were
a significant factor in motivating its adoption cannot
justify holding it unconstitutional.

"AVR argued that it should not be forced to curtail its
nonconforming use until the City has a development plan:

The City cannot even argue that the elimination of AVR's
concrete plant is part of a current effort to convert the area to
residential development. AVR's expert, John Voss, contacted
several of the property owners in the area, none of whom had
been contacted by the City about relocating or redevelopment.
Business owners said that they intend to stay in their location
for a very long time. The City could not develop just the AVR
parcel as residential, because it is too small to develop
individually.

Plaintiffs Memorandum at 16.

A-28

Id; see also Oscar P. Gustafson Co. v. City of Minneapolis.
231 Minn., 271, 42 N.W.2d 809 (1950).

In order not to mislead the reader to believe that the
judiciary never interferes with zoning decisions, this court
believes that its analysis would be incomplete without
mentioning a case where the court did invalidate such an
ordinance. In Amoco Oil Co vy. City of Minneapolis, 395
N.W.2d 115 (Minn. Ct. App. 1986), the court overturned the
city's refusal to issue a conditional use permit. The city had
denied plaintiff's request to Operate a 24-hour service station.
Amoco Oil, however, is distinguishable from the instant case,
in that the area at issue was specifically zoned to permit 24-
hour stations, as long as no groceries were sold on the
premises. In addition, the city had failed to produce any
‘ evidence that plaintiff's planned use was more intrusive than
4 uses that were already permitted without a conditional use
4 permit. Here, there is no question that a ready-mix facility is
3 incompatible with the zoning. Therefore, Amoco Oil is
inapposite and is wrongly relied upon in Support of the
proposition that the city's decision with regard to AVR is an
example of an arbitrary and Capricious misuse of its police
power. For the reasons detailed above, this court holds that
its review of defendant's amortization ordinance should be
limited, and that plaintiff has failed tO support its argument
that defendant has abused its police powers.

III. Amortization is a Recognized Method to
Eliminate Nonconforming Uses.

Plaintiff argues that the City's alleged targeting of AVR
as the single use subjected to amortization deprives AVR of
property rights. Municipalities throughout the country have
been confronted with the same problem: how to eliminate
nonconforming uses. The perpetuation of nonconforming

A-29

uses has bedeviled many cities that had hoped the uses would
just fade away. They do, only rarely. Holdings in cases from
this jurisdiction, as well as from others, uphold amortization
ordinances as a valid procedure to eliminate nonconforming
uses. "Amortization, pursuant to the state's police power, is a
device that has been used frequently in recent years to serve as
an alternate form of compensation.” Klicker v. State, 293
Minn. 149, 197 N.W.2d 434 (1972).

The theory behind amortization ordinances is set forth in
Naegele Outdoor Advertising Co. of Minnesota v. Village of
Minnetonka, supra:

In recent years a number of municipalities have
sought to eliminate preexisting nonconforming uses
by means of so-called amortization procedures, of
which the Minnetonka provision is a prime example.
The theory behind this legislative device is that the
useful life of the nonconforming use corresponds
roughly to the amortization period, so that the owner
is not deprived of his property until the end of its
useful life. In addition the monopoly position
granted during the amortization period theoretically
provides the owner with compensation for the loss of
some property interest, since the period specified
rarely corresponds precisely to the useful life of any
particular structure constituting the nonconforming
use.

281 Minn. at 501, 162 N.W.2d at 213.

In Art Neon Co. v. City and County of Denver, 488 F.2d
118 (10th Cir. 1973), where the owner of a sign business
argued that a five-year maximum period for the removal of
nonconforming signs was arbitrary and capricious, the court
noted the difficulties in enacting zoning ordinances, which are
inherently prospective in their application. It stated, "[T]here

A-30

a al a

are usually nonconforming uses which present substantial
problems. These uses are necessarily incompatible with the
purposes of zoning and are not intended to be perpetual. Thus-
there usually comes a time when such exceptions are sought
to be ended." Id. at 121.

Because owners of nonconforming uses are infrequently
accommodating to the desires of the municipalities seeking to
eliminate them, it is common for the municipality to prohibit
the use from making any improvements. "The public policy
behind that doctrine is to increase the likelihood that such
uses will in time be eliminated due to obsolescence,
exhaustion, or destruction. This in turn will lead to a uniform
use of the land consistent with the overall comprehensive
zoning plan." Oswalt v. County of Ramsey, 371 N.W.2d 241,
246 (Minn. Ct. App. 1985) (Owner of a home, a use not
permitted on a floodplain, was not allowed to make repairs to
the home after it had been damaged. An appraiser estimated
that the value of the home was approximately $69,000.00: the
cost, of repair was in excess of $35,000.00). Finding No. 6
States:

AYR proposed in 1986 to completely replace the
existing two structures with what it characterized as
a "state of the art" ready-mix plant. The city denied
AVR's request as a violation of its City Code,
because the City Code prohibited the expansion or
intensification of a nonconforming use.

This court finds that the City's refusal to allow AVR to
replace the structure is consistent with caselaw in Minnesota
and with zoning policy.

A significant number of the court decisions which have
upheld the use of amortization Ordinances to eliminate
nonconforming uses have factored into their analysis the
Owner's enjoyment of monopoly status during the period of

A-3]

time that the use has been nonconforming. In Outdoor
Graphics, Inc. v. City of Burlington, lowa, 103 F.3d 690 (8th
Cir. 1996), the court upheld the use of an amortization
procedure against criticism that the process amounted to the
denial of an owner's property rights.’ The court disagreed, in
part because of the monopoly factor:

An amortization period allows a nonconforming
owner to recoup investment and also sometimes
affords the owner the additional benefit of monopoly
status during the period since no new competitive
nonconforming uses are allowed. 8A Eugene
McQuillan, Municipal Corporations, § 25.190 (3d
ed. 1994). It is in reality a notice to owners that they
have a period of time to make whatever adjustments
or other arrangements they can to accommodate the
regulations.

Outdoor Graphics, 103 F.3d at 693, fn. 5.

In City of University Park v. Benners, 485 S.W.2d 773
(Tex. 1972), the court cited both public policy and appellant's
monopoly status in its holding that an amortization ordinance
was properly applied to eliminate the nonconforming use of
two lots. It stated, "There are strong public policy arguments
and a demonstrable public need for the fair and reasonable

”The facts of Outdoor Graphics ccho those of many cases
challenging the validity of amortization ordinances. The owner of
billboards brought an action for damages and injunctive relief against the
city for allegedly depriving it of property without just compensation. The
city had adopted an ordinance that prohibited billboards in residential
areas. There was no dispute that the ordinance was duly passed and that
Outdoor and other Burlington residents were offered notice and an
opportunity to be heard. The city’s stated reasons for enacting the
ordinance were safety and aesthetics. The ordinance provided a five-year
“grace period.”

A-32

termination of nonconforming property uses which most often
do not disappear but tend to thrive in monopolistic positions
in the community." Id. at 778. This phenomenon was noted
as well in Grant v, Mayor and City Council of Baltimore, 129
A.2d 363 (Md. Ct. App. 1957), where the council granted
owners of nonconforming billboards located in residential
areas five years within which to remove them:

Nonconforming uses have not disappeared as we had
hoped and anticipated because the general regulation
of future uses and changes, with some existing uses
uncontrolled, have put the latter in an entrenched
position often with a value that is great - and grows -
because of the artificial monopoly given it by the
law. Indeed there is general agreement that the
fundamental problem facing zoning is the inability to
eliminate the nonconforming use.

Id. at 365, quoting City of Los Angeles v. Gage, 127 Cal.
App.2d 442, 274 P.2d 34, 40 (1954).

This court notes that AVR has benefited from such
monopoly status. It has operated, without the burden of
competition, since it bought the ready-mix facility in 1974,

In addition, the court in Outdoor Graphics noted that the
owner bought the property with knowledge of its
nonconforming status.” In the case at bar, AVR bought the

10
The court wrote:

Outdoor bought the business with the knowledge that the
billboards were HoNContorming uses and that the parcels of land
were irregularly shaped and were not of much commercial value
absent the billboards Outdoor has enjoyed the benefit of
monopoly status during the pendency of this action. It
knowingly purchased Property that had been subject to a
nonconforming use during a prolonged period - at least thirty-
seven years with a predicted life of fifteen more years.

A-33

facility after it had been declared a nonconforming use. This
is reflected in the City's Findings of Fact. Finding of Fact No.
12 states:

The facility became a nonconforming use on or about
February 5, 1960, the effective date of a new zoning
ordinance under which ready-mix and concrete block
plants were permitted in the I-1 Industrial Use
Zoning District that included AVR only (1) By
special permit and (2) only if the plant was located
more than 400 feet from any residential use. The
facility was located within 400 feet of a residential
use to the east and thus, AVR did not meet the
criteria for a special use permit.

AVR bought the’ ready-mix facility in 1974,
approximately 14 years after it became nonconforming. The
fact that the city's decision to eliminate the ready-mix plant
cannot possibly come as a surprise to plaintiff was considered
by this court, and is further reflected in its conclusion that
amortization is an acceptable means in this cast to eliminate
AVR as a nonconforming use.

IV. The Holding in Naegele Supports the City's
Amortization Ordinance.

Plaintiff argues that Naegele, a case cited by both parties,
does not support defendant's amortization ordinance. This
court disagrees. In Naegele, the Minnesota Supreme Court
upheld an ordinance which’ required removal _ of
nonconforming billboards from areas zoned residential within
a three-year period, The standard of proof which is assumed

103 F.3d 690 at 694.

Dl as

eS ae aS ae ee

by plaintiffs seeking to prove that an amortization ordinance
is unconstitutional'' was delineated in Naegele as follows:

The underlying issue in making this determination
must therefore be whether the amortization provided
by the statute is reasonable. If the value of plaintiff's
property interest was extinguished before the running
of the 3-year period, there would be no taking, or if
the value of freedom from new competition for the
Statutory period equaled the value of the property
interest remaining at the end of the period, there
would be just compensation for the taking. In either
case, the length of the amortization period is
reasonable and the ordinance therefore is
constitutional. The question then becomes one of the
constitutional application of the ordinance in a given
case, and the burden is on plaintiff to establish that
the ordinance, as applied, is unconstitutional.

281 Minn. at 501, 162 N.W.2d at 213.

The court recognized that the case raised two issues: (1)
whether a municipality has the power to prohibit by zoning
ordinance the use of land in residential districts for billboard
advertising, and (2) if so, whether the removal of previously
constructed billboards can be required within a period of 3
years from the date they became nonconforming uses.

The court answered both questions in the affirmative.
Plaintiff distinguishes Naegele using criteria that are not
persuasive. For example, AVR argues that the amortization
ordinance in Naegele is unlike that of the case at bar because

' Asa preliminary matter, the court stated that plaintiff could not
successfully challenge the amortization ordinance as unconstitutional
unless 1 would be unconstitutional as applied to the property interests of
every billboard owner.

A-35

ae

ree:

FERS

wiaeeteie hance

of the nature of the property that is a nonconforming use. It
states, "A permanent ready-mix concrete plant is far removed
from a billboard which the Supreme Court found to be
removable personal property.” Plaintiff's Brief at 15. While
there is some truth to that distinction, this court was unable to
find a case, from any jurisdiction, which utilized that factor in
determining the reasonableness of a particular ordinance.
AVR also believes that the fact that the area surrounding its
facility is not exclusively residential, at this point in time,
deprives the ordinance of its claim of evenhandedness. As
discussed in the section entitled "AVR Has Not Been
Deprived of Equal Protection of the Laws," defendant's ability
to enact a zoning ordinance is limited only in that it cannot do
so arbitrarily and capriciously.

V. “Useful Life’ Refers to Recoupment of
Investment.

Of all of plaintiffs arguments, AVR reserves its most
strident criticism for defendant's interpretation of the term
"useful life" and its application to the AVR facility. Both
parties recognized that this court's pivotal determination will
be which of their calculations of the facility's useful life is
correct, and each has presented evidence in support of its
view.

AVR submitted the following "market value asset
valuation" of its facility prepared by Valuation Specialists,
whose report contained the following statements:

1. Physical depreciation is defines [sic] as
"decline in value due to such causes as wear and
tear, decay, deterioration arising from age and
loss not restored by current maintenance.

A-36

= tl te i

2. "The primary factors affecting the value of
the equipment are age, condition and type of
equipment. Most of the equipment was found to
be in fair condition."

3. "The value shown in the financial records
for fixed assets would be the depreciated
Original cost. This may not be a fair
approximation of the market value or liquidation
value of the fixed assets."

4. "Depreciation for market value purposes
may be defined as a loss from an upper limit of
value. To further elaborate, it is the effect
caused by deterioration and/or obsolescence.
Deterioration or physical depreciation is a
physical wearing out of the asset.”

5. "Effective age may be defined as the
number of years of age as defined by the
physical condition and obsolescence. If
maintenance has been good, the effective age
could be less than actual age."

6. The report concludes that the market value
of the fixed assets of AVR's St Louis Park
Sacility as of August 29, 1995, was $3 66,750.

Pl. Brief at 18-19. (Emphasis added).

AVR emphasizes that the calculation of useful life
adopted by Valuation Specialists is consistent with that the
view of AVR's appraiser, Shenahon & Company, which
found:

A-37

1. “With proper maintenance of the shell
facility and the plant equipment as needed, the
life and usefulness of the facility can be
extended significantly beyond the anticipated
remaining life; and to a greater extent than many
other commercial properties. This is because
the basic function and design of concrete
production facilities has changed very little over
time as compared, for example, to hotel, retail,
or office properties.”

2. After itemizing the equipment upgrades in
1989-90, the appraisal states: "These
improvements significantly increase the life of
the plant."

3. "The effective life of cement mixing
equipment according to the Marshall Swift
Valuation Services is twenty years, and we find
that the subject equipment overall has an
effective life of five years, with an effective
remaining life of fifteen years if nothing is done
to extend the life of the improvements."

4. "We estimate that depreciation from all
causes is allocated on the following basis:
Physical depreciation, 53%; Functional
Obsolesce, 5%, Economic Obsolescence, 0%.

5. “With proper maintenance the structure
could maintain its integrity for another forty
years and the plant could easily be operated as
long as the equipment is replaced and
maintained as it has in the past."

A-38

6. "When calculating the physical depreciation
on a plant such as the subject which has been
operating for a significant period of time the
actual age of the facility ceases to be as
Significant as the physical condition of the
property at the time of the appraisal and the
number of years that is maintained and repaired
properly over time[."]

Pl. Brief at 19-20.

The court is not persuaded by AVR's representation of
what is meant by the term “useful life” in the context of
evaluating the reasonableness of an amortization ordinance.
Even plaintiff's recitation of the testimony of Mr. Joe Senecal.
which is set out in the Record at Tab 38, pages 12-14 of the
Minutes of the November 23. 1992, Special City Council
Meeting, misses the mark in terms of characterizing the
method by which concrete plants are to be valued for
purposes of amortization.'> AVR js probably correct in its
assertion that Mr. Senecal had in mind an observation more

12 :
Mr. Senecal introduced himself as an expert appraiser of ready-mix
concrete plants. He testified:

So, plants, if they are well maintained and they got taken good
care of, they can last for a long time. We're havin’ a problem
with concrete plants around the country. This is not the only
place. For some reason, ev erybody got to have concrete but yet
we got a problem with concrete plants, and it's the zoning that
makes the problem with the concrete plants and because of the
zoning, i now makes the concrete plants very, very valuable.
So anybody that has a concrete plant that's up and Operating, it's
worth a lot of money) To move a plant today similar to the St.
Louis Park one, and relocate it. you'd be talkin’ about anywhere
from 1.5 million to 1.8 million casy.

Plaintiff's Memorandum at 25-26.

A-39

insightful than, "Concrete plants [are] getting to be a problem
around the country." However, this court also disagrees with
AVR's interpretation of the portion of Mr. Senecal's testimony
which seems to attribute more value to ready-mix plants than
mere recoupment of investment in the structure would support
because of generally inhospitable zoning regulations. AVR
urges that the court agree with it that, "The true nature of
Senecal's testimony is that zoning changes cause ready-mix
plants to become much more valuable because cities are
limiting (or in this case, prohibiting) the location of ready-mix
plants.” Plaintiff's Memorandum at 26. This court finds that
neither spin is correct; however, it also finds that the City did
not rely on Mr. Senecal's testimony.

This court adopts the City's calculation of AVR's useful
life, because it is consistent with other holdings on the issue.
In City of University Park v. Benners, 485 S.W.2d 773 (Tex.
1972), the court enumerated factors to be considered in
determining whether an amortization ordinance is reasonable:

In the application of the reasonableness test to the
legislative determination, the courts have used a
variety of factors, and combinations thereof. These
include the nature of the nonconforming use, the
character of the structure, the location, what part of
the individual's total business is concerned, the time
periods, salvage, depreciation for income tax
purposes, and depreciation for other purposes, and
the monopoly or advantage, if any, resulting from the
fact that similar new structures are prohibited in the
same area.

Id. at 122.

As noted by defendant, AVR has a network of ready-mix
plants in the western half of the metropolitan area as well as a
gravel mining operation in Apple Valley. The taxable income

A-40

from this facility which represents approximately ten percent
of AVR's income from its concrete operations was
$113,000.00 in 1992, $172,000.00 in 1993 and $200,000.00
in 1994. The facility had been a nonconforming use for
fourteen years in 1974, when AVR bought it for $260,000.00
The facility has provided a substantial return over the last 23
years. It is fully depreciated from an income tax standpoint,
and under Generally Accepted Accounting Principles. See
Def. Brief at 25.

Plaintiff took particular offense at defendant's mention of
the depreciation status of the facility on tax forms, Stating that
‘tax depreciation is a fiction that does not recognize the
reality that AVR's St. Louis Park facility has significant useful
life left." Pl. Brief at 20. In Grant v. Mayor and City Council
of Baltimore, 129 A.2d 363 (Md. Ct. App. 1957), the owner
of billboards argued that a five-year amortization period was
inadequate for the purpose of valuing his property, despite the
fact that his accountant testified that, at the direction of
company officers, he used a five-year depreciation schedule
for tax purposes. The court was unimpressed:

A corporation that has regularly, year by year, acted
in its financial affairs, under the oath of its
authorized officers (and penalty of perjury) on the
premise that the full useful life of its billboards is
five years is handicapped seriously in arguing
persuasively that legislative reliance on that same
premise has done it a constitutional wrong - has
taken from it substantial property without
compensation - by banning further use of those
billboards.

Id. at 372.
AYR is similarly handicapped in its argument against the
relevance of a calculation upon which it has relied itself.

A-41

Cases offer strong refutation to AVR's assertion that the
applicable measure of useful life is market value. “The owner
must "be afforded an opportunity to recover his investment in
the structures theretofore placed on the property. The
reasonableness of the opportunity for recoupment thus
afforded is measured by conditions at the time the use is
declared nonconforming arid not ... by conditions upon
expiration of the tolerance period." City of University Park,
at 779.

Similarly, there is no support for an argument that AVR
should be allowed to operate until the owner can recover the
market value of the structure:

[W]e conclude that Benners necessarily precludes
recoupment or recovery of the market value or any
conformity cost of the structures as_ essential
considerations in determining the question of
reasonableness by requiring only that the owner be
afforded a reasonable opportunity to recoup or
recover his investment in the structure.

Lubbock Poster Co. v. City of Lubbock, 569 S.W.2d 935, 942
(Tex. Ct. App. 1978), cert, denied, 444 U.S. 833 (1979).

The leading case on measuring recoupment of investment
is Murmur Corp. v. Board of Adjustment of the City of
Dallas, 718 S.W.2d 790 (Tex. Ct. App. 1986), where the
owner of a nonconforming smelter appealed its order to
terminate. The court sided with the municipality:

Murmur attacks the board's order on the ground that
it failed to follow the proper standard for terminating
the alleged nonconforming use. It argues that the
board is authorized to terminate a nonconforming
use only after allowing the use to continue for a
sufficient time to recover the "full value" of the

A-42

nonconforming structure, which it interprets to mean
market value or replacement value, and therefore,
that the board could not properly limit the allowance
to Murmur's actual investment in the nonconforming
UO oy 5s [W]e conclude that recoupment of the
investment is a permissible standard.

Id. at 795.

The court wrote further, "If the owner is entitled to
recoup only his ‘investment in the structure.’ then that amount
is the measure of ‘full value’ rather than the market value or
any other measure of value." Id.

As this court noted previously, AVR purchased the
facility in 1974, for $260,000.00. I has recouped its
investment in the structure. For the reasons outlined above,
the court agrees with the City's position as to AVR's useful
life, and thus finds that the City's amortization ordinance was
properly applied to AVR and does not deprive it of property
without compensation.

VI. The City Did Not Rely Solely Upon Anecdotal
Evidence.

AVR argues that the City placed undue emphasis on the
opinions of neighbors, particularly those who reside in the
condominium complex, 3300 on the Park. To bolster its
contention that this court is obligated to invalidate the
amortization ordinance because of the City's allegedly
unreasonable reliance on anecdotal evidence, it cited a
Minnesota case, which this court believes is inapposite.

In Scott County Lumber v. City of Shakopee, 417
N.W.2d 721 (Minn. Ct. App. 1988), the court held that the
City's denial of a conditional use permit to operate a gravel pit
was arbitrary, as it was not supported by legally sufficient
reasons. In Scott County, however, the City relied solely

A-43

upon neighborhood opposition in its denial, in spite of the fact
that both the environmental assessment worksheet
recommendation and the sound test results clearly supported
issuance of the permit. The most notable aspect of the case,
however, was the extent to which the City was determined to
bend the rules in order to accommodate the wishes of
neighboring landowners. For example, a city council member
who voted to deny the permit, "admitted glancing at the
environmental assessment worksheet, said that it did not
influence his vote and that he based his decision on
landowners’ testimony." Id. at 725. Scott County does not
stand for the sweeping proposition that a legislative body may
not consider testimony from neighbors, only that it may not
do so in order to supplant other evidence, "[The] City relied
solely on complaints from nearby residents which does not
provide a legal and sufficient basis under Minnesota law." Id.
at 728. This interpretation finds support in other Minnesota
cases as well. "Community opposition to a landowner's desire
to use his property for a particular purpose is not a legally
sufficient reason for denying a conditional use permit.” C.R.
Investments, Inc. v. Village of Shoreview, 304 N.W.2d 320,
325 (Minn. 1981); Amoco Oil Co. v. City of Minneapolis,
395 N.W.2d 115, 118 (Minn. Ct. App. 1986).

The holdings of none of the above-cited cases espouses
the theory that neighborhood support of, or opposition to, a
particular ordinance has no place in determining whether or
not it 1s passed, only that a municipality also must heed the
opinions of experts with the opposing position. That balance
is what is required was reaffirmed in the recent case Trisko v.
City of Waite Park, 566 N.W.2d 349 (Minn. Ct. App. 1997).
Appellant owned a 98-acre rock quarry. The City rejected
application for a conditional use permit to operate another
quarry. Appellant contended that the city had improperly
discounted the testimony of experts in favor of neighborhood

A-44

Opposition consisting of vague and speculative opinions,'*

The Trisko court held that a municipality must base the denial
of a conditional use permit on “something more concrete than
neighborhood Opposition and expression of concern for public
Safety." Id. at 355: See also Chanhassen Estates Residents
Ass'n v. City of Chanhassen, 342 N.W.2d 335 (Minn. 1984).

Because this court finds that St. Louis Park did not
unreasonably credit neighborhood Opposition over expert
testimony in favor of the continued operation of AVR, this
court believes that AVR's objection to the amortization
ordinance on that basis js without merit.

VII. AVR Has Not Been Deprived of Equal
Protection of the Laws.

Courts “frequently [have] upheld — underinclusive
Classifications on the sound theory that a legislature may deal
with part of a problem without addressing all of it.
Cornerstone Bible Church v. City of Hastings, 948 F.2d 464,
470 (8th Cir. 199}). quoting Erznoznik y. City of
Jacksonville, 422 U.S. 205, 215, 95 S.Ct. 2268, 2275-76
(1975). AVR names other establishments Which are not being
amortized by the City, such as Al's Liquor and Park Auto, and
asserts that the record reflects no rational basis that supports
the distinction.

AVR argues that it has been subjected to disparate
treatment in violation of the Equal Protection Clause of the
Fourteenth Amendment. which states that no State shall "deny

Although at least one Neighbor stated that many older residents in
the past had contracted Silicosis, a respiratory disease, from granite dust
produced by the existing quarry, and several neighbors asserted that they
expected an increase in dust-related respiratory problems if the proposed
quarry opened, it was established by expert testimony that the exposure
level for silicosis dust Surrounding the quarries is “one-quarter of the level
that is considered safe.” which would create essentially no risk. Id. at 356.

A-45

to any person within its jurisdiction the equal protection of the
laws," which is -essentially a direction that all persons
similarly situated should be treated alike. City of Cleburne,
Texas _v. Cleburne Living Center, Inc., 473 U.S. 432, 439
(1985) citing Plyler v. Doe, 457 U.S. 202, 216 (1982). In
support of its assertion that the City has held it to a standard
that it has not applied uniformly to other similar
establishments, AVR cites two cases, both of which are
inapposite.

In Cleburne, the Cleburne Living Center intended to
lease a building for the operation of a group home for the
mentally retarded. Using archaic nomenclature, the City
determined that as a "hospital for the feeble-minded,” the
home required a special use permit, which it then summarily
denied.'* The question presented was whether the city could
require a permit for the facility to house the mentally retarded
when it did not for other care and multiple dwelling facilities.
The three underlying justifications for the distinction were
arbitrary and disingenuous. The council noted that a majority
of landowners living within 200 feet of the residence were
opposed to living near a home for the mentally retarded, that
the home's location near a junior high would inevitably lead to
harassment by the students and that the home's location on a
500-year flood plain was unsafe. With regard to the
sentiments of the landowners, the Supreme Court held (and,
as this court noted in the previous section), mere unsupported
negative attitudes are an insufficient basis upon which to deny
a special use permit. Id. at 448. With regard to the home's
location on a flood plain, the City presented no evidence that
the nature of the residents’ disabilities had any impact on the
level of danger posed by a flood. Id. at 449.

‘In holding the ordinance constitutional, the district court
névertheless noted that if the potential residents of the group home were
not mentally retarded, but the home was the same in all other respects, its
use would be permitted under the city's zoning ordinance

A-46

The Court held that because the record was devoid of any
rational basis for believing that the Proposed group home
would threaten the city's legitimate interests in a way that
permitted uses would not, requiring a special use permit for
the home deprived the operators of equal protection of the
laws.
In Cornerstone Bible Church v. City of Hastings, 948
F.2d 464 (8th Cir. 1991), the issue was whether the city's
attempt to prevent a church from locating in the central
commercial and industrial zone violated the church's
constitutional rights. The City Council's resolution provided:

The nature and timing of general church activities is
in contrast to the business environment and to the
business hours of the downtown. Therefore, no
business or retail contribution or activity is generated
which is contrary to the intent of the C-3 zone and
the goals and objectives of the Downtown
Redevelopment Plan and the Hastings
Comprehensive Plan.

Id. at 467.

The City, however, did permit other non-commercial
entities to be situated in the C-3 zone. For example, within
the C-3 zone the City allowed fraternal Organizations, which
would similarly generate a lack of revenue. The court struck
down the ordinance on €qual protection grounds:

The Church has placed the City's rationale for
excluding churches at issue. The City is excluding
the Church because it will not generate economic
activity, but the Church has establisned a relevant
similarity between itself and permitted non-
commercial entities. It is now incumbent on the City
to provide the rati.snal basis for this apparent unequal

A-47

treatment of similarly entities. The City has failed to
support its exclusion of the Church with any
justification beyond the affidavits of the city
planners.

Id. at 471. ° =

Contrary to plaintiffs representations, defendant has not
treated similarly situated entities differently. Defendant has
amply demonstrated that the noise and dust generated by
AVR is significantly more severe and disruptive than noise
and dust caused by other commercial entities that are, at this
point, not targeted by the amortization ordinance.'* Because
defendant has stated a nondiscriminatory justification for its
treatment of AVR, it survives a challenge based on equal
protection concerns. For that reason, this court dismisses
AVR's objection to the amortization ordinance on that basis.

CONCLUSION

For the reasons outlined above, this court grants
defendant's motion for summary judgment. The court denies
plaintiffs motion for summary judgment and dismisses
plaintiff's Complaint.

H.P.A.

'S For example, in its brief, AVR objected to the fact that Al's Bar
and the automobile reduction plant were exempted from the amortization
ordinance. However, it concedes that Al's Bar received support from
neighborhood residents, and the automobile reduction plant went out of
business. See Plaintiff's Brief at 5-6.

A-48

STATE OF MINNESOTA DISTRICT COURT
COUNTY OF HENNEPIN FOURTH JUDICIAL DISTRICT

AVR, Inc., NOTICE OF APPEAL TO
a Minnesota corporation, COURT OF APPEALS

Plaintiff, TRIAL COURT CASE NO. AP-96-0182
v. Date Judgment Entered:
February 20, 1998

City of St. Louis Park.

Defendant.

TO: Clerk of Appellate Courts, Minnesota Judicial Center, 25
Constitution Avenue, St. Paul, MN 55155.

PLEASE TAKE NOTICE that the above-named
Plaintiff appeals to the Court of Appeals of the State of
Minnesota from a judgment of the Court entered on the date
shown, entering judgment in favor of Defendant.

Attorney for Defendant: Thomas M. Scott, Campbell,
Knutson, Scott & Fuchs. P.A., Suite 317 Eagandale Office
Center, 1380 Corporate Center Curve. Eagan, MN 5512].
(612) 452-5000.

Dated: March 20, 1998
By:_/s/

Wm. Christopher Penwel] (#164847)
Anthony J. Gleekel (#185395)

SIEGEL, BRILL, GREUPNER. DUFFY & FOSTER
A-49

Attorneys for Plaintiff

Suite 1300

100 Washington Avenue South
Minneapolis, MN 5540]

(612) 339-7131

STATE OF MINNESOTA
IN COURT OF APPEALS

AVR, Inc., APPELLANT'S STATEMENT
a Minnesota corporation, OF THE CASE
Appellant, Trial Court Case No.:

AP-96-0182

Appellate Court Case No:

City of St. Louis Park.

Respondent.

1. Court or agency of case origination and name of
judge or hearing officer who presided.

State of Minnesota. Hennepin County District Court.
Fourth Judicial District, H. Peter Albrecht, Judge of
District Court.

y Jurisdictional Statement.
Appellant appeals the Court's entry of judgment in favor
of Respondent. Judgment was entered February 20,

1998.

3. State the type of litigation and designate any statutes
at issue.

Zoning/Constitutional Law.

4. Brief description of claims, defenses, issues litigated
and result below.

Between 1992 and 1995, the City of St. Louis Park
adopted several ordinances which singled Appellant out
as the only use in the City~to be amortized out of
existence. An extensive record was developed in
numerous City Council hearings in which Appellant and
Respondent submitted testimony and other evidence. On
October 2, 1995, the City passed an _ ordinance
establishing a two year amortization period at the end of
which Appellant was to terminate its ready mix concrete
operation. In the District Court, Appellant and
Respondent agreed to submit cross-motions for summary
judgment based upon the record developed before the
City Council. Appellant claims that the amortization
ordinance violates its constitutionally held property
rights, violates Appellant's substantive due process rights,
violates Appellant's equal protection rights, improperly
applies Minnesota case law on amortization of existing
uses, and is contrary to established caselaw relating
specifically to Appellant's facility. Appellant also
asserted that Respondent, in passing the amortization
ordinances, acted in a quasi judicial, not legislative,
capacity and that, therefore, the District Court could
exercise greater discretion in reviewing Respondent's
actions. The District Court ordered summary judgment
in favor of Respondent finding that Respondent had acted
in a legislative capacity, recognizing amortization as a
proper method of eliminating non-conforming uses,
finding that Respondent's adoption of the amortization
ordinances was reasonable and rejecting Appellant's
claims that Respondent had violated its constitutional
rights.

5. Issues proposed to be raised on appeal.

a.

Did the District Court err in granting Respondent's
motion for summary judgment and denying
Appellant's motion for summary judgment?

Does the Minnesota Court of Appeals’ decision in
Apple Valley Red-E-Mix v. City of St. Louis Park,
359 N.W.2d 313 (Minn. Ct. App. 1984) control the
determination of this case?

Did Respondent act in a quasi judicial, not
legislative, capacity in passing, the amortization
ordinances?

Did Respondent, in Passing the amortization
ordinances, violate Appellant's federal and state
constitutionally protected 5th and 14th Amendment
property rights?

Did Respondent, in passing the amortization
Ordinances, act arbitrarily, Capriciously and
unreasonably in violation of Appellant's federal and
state substantive due process rights?

Did Respondent, in passing the amortization
ordinances, violate Appellant's federal and state
constitutionally protected right to equal protection?

May Respondent amortize Appellant's
non-conforming use out of existence and. if SO, Was
the two year amortization period legally and factually
supported by the record and case law?

10.

Is a transcript required?

Yes, a full transcript 1s required.
Is oral argument requested?
Yes.

Are formal briefs necessary?
Yes.

Argument location provided?
No.

Name, address, zip codes and telephone numbers of
the attorneys for Appellant and Respondent.

Wm. Christopher Penwell

Anthony J. Gleekel

Siegel, Brill, Greupner, Duffy & Foster, P.A.
Attorneys for Appellant

100 Washington Avenue South

Suite 1300

Minneapolis, MN 55401

(612) 339-7131

Thomas M. Scott

Campbell, Knutson, Scott & Fuchs, P.A.
Attorneys for Respondent

Suite 317 Eagandale Office Center

1380 Corporate Center Curve

Eagan, MN 55121

(612) 452-5000

Dated: March 20, 1998.

By:

/s/
Wm. Christopher Penwell (#1 64847)
Anthony J. Gleekel (#185395)

SIEGEL, BRILL, GREUPNER, DUFFY & FOSTER,
Attorneys for Appellants

Suite 1300

100 Washington Avenue South

Minneapolis, MN 5540]

(612) 339-713] &

A-55

STATE OF MINNESOTA
IN COURT OF APPEALS
C7-98-516

AVR, Inc.,
Appellant,

VS.

City of St. Louis Park,
Respondent.

Filed October 20, 1998
Affirmed
Willis, Judge

Hennepin County District Court
File No. 96182

Gerald S. Duffy, William Christopher Penwell, Anthony J.
Gleekel, Siegel, Brill, Greupner, Duffy & Foster, P.A., 100
Washington Avenue South, Suite 1300, Minneapolis, MN
55101 (for appellant)

Roger N. Knutson, Thomas M. Scott, Campbell Knutson,
P.A., 1380 Corporate Center Curve, Suite 317, Eagan, MN
55121 (for respondent)

Considered and decided by Kalitowski, Presiding Judge,
Amundson, Judge, and Willis, Judge,

_

A-56

SYLLABUS

1. A city's adoption of an ordinance establishing an
amortization period for a preexisting nonconforming use is a
legislative act that courts afford great deference.

2. A two-year amortization period is reasonable where
it reflects a property's useful life and a city's analysis of o >er
relevant factors.

3. Where there is no showing of disparate treatrnent of
similarly situated Property Owners, an amortization ordinance
and an ordinance establishing an amortization period for a
property does not violate the Equal Protection Clause.

OPINION
WILLIS, Judge

Appellant AVR, Inc., challenges the district court's order
granting summary judgment to respondent City of St. Louis
Park, claiming that the city’s Zoning ordinance that establishes
a two-year amortization period for appellant's preexisting
nonconforming use is unreasonable and violates appellant's
right to equal protection of the laws. We affirm.

FACTS

AYR owns and operates a ready-mix concrete plant in the
City of St. Louis Park. The plant was constructed in 1954. Ip
1959, the city passed a zoning ordinance permitting ready-mix
plants in the area of the city zoned for industrial use but only
pursuant to a special use permit. The city did not grant at a
special use permit to the then-owners of this ready-mix plant,

A-57

but rather classified the plant as a preexisting nonconforming
use, because it was within 400 feet of a residential district.

In 1973, the city amended its zoning code to eliminate
ready-mix and concrete block plants as permitted uses in the
city. AVR purchased the ready-mix plant in 1974 for
$260,000. In May 1980, the city adopted a new
comprehensive plan and put AVR on notice that the city
intended to phase out the plant and rezone the site for
commercial or office use or "as a second choice high density
residential use." AVR commenced a declaratory judgment
action seeking to invalidate the 1973 zoning ordinance on the
ground“that it wrongfully eliminated ready-mix plants as
permitted uses in industrial zones. The district court declared
the ordinance void as applied to AVR, and the city appealed.
This court concluded that because the plant was not a public
nuisance or a nuisance per se, the city could not legislate it out
of existence. Apple Valley Red-E-Mix v. City of St. Louis
Park, 359 N.W.2d 313, 315 (Minn. App. 1984), review
denied (Minn. Mar. 21, 1985).

In 1990, the city adopted another new comprehensive
plan, which provides that, in the area where the AVR plant is
located,

[hJeavy industrial uses including a _ concrete
ready-mix plant and outdoor storage of heavy
equipment are to be phased out, and the sites are to
be used for high density residential use.

St. Louis Park, Minn., Comprehensive Plan 1990-2010 § 16,
at 16-5 (1990). In 1992, the city rezoned AVR's property
from I-4 Industrial to R-4 Multifamily Residential. The
ordinance provides that the city council

shall by ordinance amend the Zoning Ordinance to
establish an amortization period for individual land

A-58

uses not permitted in the City. The amortization
period shall commence upon publication of the
ordinance establishing the length of amortization
period.

St. Louis Park, Minn., Code of Ordinances § 14:7-4(D)(4)
(1992). The 1992 ordinance required the owners of all
properties "that contain a use not permitted in any zoning
district [to] register their non-conforming use with the City"
within one year of the adoption of the ordinance. Jd. §
14:7-4(B). The ordinance also required the zoning
administrator to meet with such property owners, review each
registration application, and determine a reasonable
amortization period for each nonconforming use. In
determining the length of a reasonable amortization period,
the zoning administrator was to consider, at a minimum, the
following factors:

a. Information relating to the structure located on
the property;

b. Nature of the use:

c. Location of the property in relation to
Surrounding uses;

d. Description of the character of and uses in the
surrounding neighborhood:

e. Cost of the property and improvements to the
property;

f. Benefit to the public by requiring the
termination of the non-conforming use;

g. Burden on the property owner by requiring the
termination of the non-conforming use;

h. The length of time the use has been in existence
and the length of time the use has been
non-conforming.

A-59

Id. § 14:7-4(D)(2). The city council accepted AVR's
registration of the plant property as substantially complete on
June 29, 1995.

On July 11, 1995, the .city council and planning
commission held a joint public hearing for the purpose of
adopting an amortization ordinance relating to the AVR plant.
City staff presented to the council and planning commission
the report and recommendation required by the 1992
ordinance. AVR presented information supporting _ its
position that the plant has an indefinite remaining physical
life.

On October 2, 1995, the city amended its zoning
ordinance by adopting the following provision:

The reasonable amortization period applicable to the
ready-mix facility owned and operated by [AVR] * *
* shall be two (2) years, commencing upon
publication of this ordinance. At the conclusion of
the two-year amortization period, [AVR's]
nonconforming ready-mix use shall terminate and
cease to operate.

Id. § 14:7-4.1 (1995). In conjunction with the adoption of
section 14:7-4.1, the city council adopted a resolution that
contained 42 findings of fact supporting the ordinance and
that stated:

The Minnesota Supreme Court has directed, in the
Naegele Outdoor Advertising Co. of Minn. vy.
Village of Minnetonka decision, that any
amortization period must be "reasonable." Courts in
other jurisdictions have identified at least seven (7)
factors by which the reasonableness of an
amortization period may be evaluated. The St. Louis

A-60

Park Code of Ordinances incorporates those specific
factors in its Amortization Ordinance.

St. Louis Park, Minn., Res. No. 95-131, J 3 (1995) (citing St.
Louis Park, Minn., Code of Ordinances § 14:7-4(D)(2)(a-h)
(1992)). The city addressed the factors identified in its
amortization ordinance in making findings to support its
determination of the length of the amortization period for
AVR’'s plant.

The city also considered the useful life of the plant. To
assist it in making that determination. the city retained an
accounting firm and a real estate appraisal firm. The
accounting firm advised the city that, based on generally
accepted accounting principles, the plant's "useful life expired
no later than 1994" and that AVR had not only recovered its
investment but also had earned a return of approximately 560
percent on its investment. Jd. J 37. The city council found
that

[b]ased u

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386018_1432%3A1. Public record. Not legal advice.