We won: Appeal against Unfair Assessments Succeeds

On May 2nd, the Ramsey County District Court ruled in our favor in our appeal against the City of Saint Paul’s street maintenance assessment charges.

In a 22 page written order, Judge Awsumb ruled definitively that charges assessed to properties under the Street Maintenance Service Program (SMSP) are non-uniform taxes thus requiring proof of special benefit, not regulatory fees.

The court agreed with our argument that the SMSP program was not meaningfully distinguishable from the previous ROW program, which had been the subject of the Minnesota Supreme Court’s adverse ruling in First Baptist Church vs. City of Saint Paul (2016).

First Baptist Decision Still Controlling Law

The City sought to rely upon specific statutory authorization for the remaining four services still included in the program (street sweeping, lighting, seal coating, and mill & overlay). In assessing that claim, the Court concluded that “where there is no public nuisance, hazardous condition, or damage created by a property owner… the maintenance and provision of SMSP services are an exercise of the tax powers and not an exercise of the police powers, regardless of what statute the City claim applies”.

Evaluating the purpose of the charges, the Court was unconvinced by the City’s claim that the SMSP program was an attempt to comply with the 2016 ruling. In actuality, the court found that “It is apparent that the City redrafted its program’s parameters in a way to circumvent the ruling in First Baptist 2016. The City’s primary purpose in creating the SMSP was to raise the same funding that it raised with ROW, but to use different language and a different process to raise that funding so as not to run afoul of First Baptist (2016).”

Having evaluated both the language and the purpose of the SMSP charges, the court found that the charges are an exercise of the City’s tax power, not its fee power, and are therefore not valid unless the City can show a ‘special benefit’ to the properties assessed. Which of course, it can’t. Regular street maintenance is a basic municipal expectation and does not increase property values, as would be necessary to demonstrate special benefit.

We are hopeful that today’s ruling finally brings an end to almost two decades of illegal, non-uniform taxation dressed up as regulatory fees, and that the City of Saint Paul chooses instead to pay for street maintenance through normal property taxes – as it should have done from the beginning.

District Court Hears Appeal

More than 3 years after we filed our first Appeal against the City of Saint Paul’s Mill & Overlay program, our consolidated Appeal was heard in the Ramsey County District Court today.

The hour long hearing was held virtually. Ben Loetscher of Ferdinand Peters appeared on our behalf, while Anissa Mediger appeared on behalf of the City of Saint Paul. The hearing was before Judge Robert A. Awsumb. Lead plaintiffs were also in attendance.

Since we filed our appeal, several cases all related to the SMSP program were consolidated for trial, as they all involve substantially the same issues.

Before the hearing, the parties agreed to a series of factual stipulations, limiting the issue to be decided to whether the City’s assessments are properly regarded as taxes or fees. It has been our position from the beginning that, following First Baptist and subsequent judicial opinion, the City’s assessments are taxes subject to the Special Benefit Test.

A written ruling detailing the Judge’s decision is anticipated in April. We will post an update once it is available.

Fair Streets St. Paul Organizing 2019 Mill & Overlay Appeals for Downtown and Others

We have received word that the City of St. Paul has started sending out initial invoices for its 2019 Mill & Overlay projects.

As with the 2018 projects, the City’s policy of burdening property owners on thoroughfares with the vastly disproportionate costs of maintaining those streets for everyone is unfair and contrary to the law.

Based on initial conversations with Downtown property owners, there is considerable anger and a desire to contest these charges. We are therefore planning to appeal the 2019 charges for those owners, just as we have done on behalf of more than 45 appellants for 2018. We are also gathering initial expressions of interest from owners with property on any of the other 2019 streets.

As with our 2018 appeals, our attorney Jack Hoeschler will represent us in any 2019 joint appeals.

Which Properties Can I Express Interest For?

The 2019 Mill & Overlay projects are as follows:

If you own property on any of the above streets and have received or anticipate receiving a bill for Mill & Overlay work completed in 2019, we want to hear from you.

How do I express interest in a joint appeal?

You can fill out our new Expression of Intent Form for 2019.

The form is your initial expression of interest in appealing the 2019 Mill & Overlay charges collectively on a contingency basis. You can also call us on (612) 351-2311 or email us at if you have questions about appealing.

Second Appeal: City on Notice

Following the City’s decision to approve the remaining four sets of assessments on September 28th, we have served our second appeal against the 2018 mill & overlay charges on the City clerk. This new appeal is from property owners on Franklin Ave., Prior Ave., Third St. and Western Ave. and comprises an additional 16 properties. We’ll file our appeal notice with the District Court within the next 10 days.

This takes us up to 36 properties and 45 named appellants in total across the two appeals. Typically, the city relies on a mixture of short deadlines, specific procedural requirements, and economic reality to make it impractical for folks to appeal their assessments. With this many people standing together, that’s not an option this time.

Read the full second appeal Summons (PDF)

City holds closed-door meeting to consider current appeals

Yesterday, the city held a closed door meeting “to discuss pending litigation in First Baptist Church of St. Paul, et al v. City of Saint Paul and Christina Anderson, et al v. City of Saint Paul”.

No further details were shared, but it’s likely that the city attorney has (finally) looked at the adverse decision by Judge Millenacker in First Baptist (2018) that assessments under the SMSP are still taxes, not fees, despite the changes the city made to the old ROW program in 2016. Although that case relates to street sweeping rather than mill & overlay, the legal principles are broadly similar. In fact, it could be said that the city has even less of a case to call street resurfacing a fee than it does for street sweeping under Minnesota law.

Making – or amending – policy with the benefit of solid legal advice is a basic principle of good government. With the broader conversation happening around how to maintain a sustainable transportation policy in St. Paul, there’s a real opportunity to start afresh.

Related Links:

Appeal filed: St.Paul on notice

Today we filed our joint appeal against the 2018 Street Maintenance Program charges with the Ramsey County District Court, following official notice to the City Clerk on July 9th.

26 neighbors named on the appeal

Although we had just 20 days following the City’s approval of our revised assessments to organize and file our appeal, the response from our neighbors has been overwhelming.

This first appeal names a total of 26 appellants, representing 20 individual properties. The appellants are drawn from four of the eight mill & overlay projects for 2018: Victoria St., Stryker Ave., Forest St., and Arlington Ave. – all of which had their assessment rolls passed at the June 19th meeting. We’re planning a supplemental appeal for the remaining four projects in due course.

Street maintenance program is nothing new

As we note in our appeal, the 2018 program is “little more than a scaled-down and rebranded version of [the city’s] discredited Street ROW Assessment Program.” That program was found to be illegal by the Minnesota Supreme Court in 2016.

The primary purpose of the current Street Maintenance Program is to raise revenue and balance the city’s budget. The city’s own Public Works department has put forward a number of sensible options including a gas tax (that would raise $3 million under the Governor’s proposal), user fees, a bond issue, road restrictions to reduce wear from trucks and other heavy vehicles, or ad valorem property taxes.

The city could use any of these approaches to pay for street maintenance. What it can’t do is play with terminology to get around the law.

Read the appeal notice: 2018 Mill & Overlay Notice of Appeal – Victoria, Stryker, Forest, Arlington (PDF)

Joint appeal planned – Hoeschler takes our case

After extensive consultation with our neighbors over the past few days, we are are moving ahead with a joint legal challenge to the City of St. Paul’s mill and overlay policy.

This is not a step we’ve taken lightly. From the beginning, our preferred path to resolution has been through constructive engagement with the city. But the city council’s failure to reform the system itself, even after a 2-month internal process which included zero public consultation, speaks volumes.

While we give full credit to those on the city council who brokered the current political compromise (based on moving the cost of ADA-compliant curbs to the general fund), the system itself has not changed. The city is still disguising a revenue raising exercise as a use of its police powers and circumventing Minnesota law, all so it can claim it’s not raising our property taxes.

Jack Hoeschler to represent appellants

We won’t be fighting alone. Many of our neighbors feel the exact same way. There will be more than 20 named appellants, representing at least 15 separate properties, listed on our appeal.

We’ll be represented as a group by Jack Hoeschler. If the name sounds familiar, that’s because Jack is the same attorney who successfully challenged the city’s Right of Way assessment in the Minnesota Supreme Court in 2016, in First Baptist Church of St. Paul v City of St. Paul.

Jack is an experienced attorney with a wealth of expertise in Real Estate tax valuation and special assessment appeals. We’re absolutely thrilled to have him representing us.

This from Jack:

“I am personally irritated that the City never seems to learn from prior mistakes. The Supreme Court told them they could not do this but they still persist. It is a shame that we have to sue them again to encourage good behavior. I am therefore happy to help everyone who feels similarly.”

We didn’t ask for this fight. We’ve already put in countless hours of our time, far in excess of the amount we were assessed, because we believe it’s important to stand up for our community, to advocate for a fair and sustainable distribution of our shared tax burden, and to insist that the City is held democratically accountable to its constituents.

Just as the 2016 legal challenge in First Baptist was needed to prompt the city to reconsider the old Right of Way policy, it will take a successful legal challenge to demonstrate to the city that they are operating outside the authority granted to them by Minnesota law, as well as the safeguards for taxpayers that go along with it.

If your property was subject to mill & overlay project in 2018 and you are interested in joining our appeal, head on over to our appeal page.

District Court: Street Maintenance Program is Illegal

In a significant blow to the City’s current Street Maintenance Service Program, the District Court has just ruled that the new program is no different to the old one.

The City’s previous Right of Way (ROW) assessment scheme was struck down by the Minnesota Supreme Court in 2016. That’s how we got the current Street Maintenance Service Program (SMSP), which moved some services into the general fund but still taxes individual properties for street sweeping, lighting, seal coating, and mill and overlay based on cost.

Delivering the District Court’s new opinion in First Baptist from the bench, Judge Millenacker ruled that the new SMSP program was functionally equivalent to the ROW program. In other words, it’s still a tax, not a fee. That renders it illegal in its current form – just like the old program.

That’s what we’ve been saying all along: the new program isn’t just unfair, it’s illegal.

This new decision is regarding charges for street sweeping and lighting, which is directly comparable to the mill and overlay charges we are challenging. We’re urging the City to delay action, including their vote scheduled for Wednesday May 22nd, until they’ve had a chance to review the court’s published opinion.
Update (8/9/19): Judge Millenacker has since delivered her written opinion in the above case. You can download it in full below.
Related Links: