Minneapolis appeals court order halting 2040 Plan

The city of Minneapolis has filed a notice to appeal last week's District Court order throwing out its 2040 Comprehensive Plan and ordering the city to revert back to its 2030 Plan, the result of a yearslong legal challenge by environmental groups.

"A big part of keeping housing affordable is increasing the supply of housing," said Mayor Jacob Frey in a news release. "We've invested in record amounts of affordable rental housing production in Minneapolis, limited rent increases to just 1% for the past five years and have been credited with keeping inflation way below the national average. We've done all of this — and have allowed for a diversity of housing options in all neighborhoods — because of the 2040 Plan."

Since Hennepin County District Judge Joseph Klein issued his injunction on the 2040 Plan on Sept. 5, developers in Minneapolis have been scrambling and speculating about the future of their projects. Their concerns: what the ruling means for projects currently moving through the pipeline of city approvals, and whether recently completed citywide rezoning will now be undone.

According to the city news release, there are 55 units of affordable housing in development that won't be built if Klein's ruling stands, and another 69 units that have already been approved but may not receive building permits.

The city has already produced 256 units of affordable housing in the three years since the 2040 Plan went into effect, which would not have been possible under the 2030 Plan, according to the release.

In the statement of its case, the city is asking the Court of Appeals to consider whether Klein erred by "issuing an injunction without sufficient factual support and analysis, issuing factual findings that are clearly erroneous and misstating and misapplying the case law."

The city also argued that the court's order forced Minneapolis out of compliance with the Metropolitan Land Planning Act, which requires the city to review — and if necessary — update its comprehensive plan every 10 years.

There is a nonpublic hearing in the case scheduled for Tuesday, after which the judge will decide how to proceed.

Jack Perry, lawyer for the plaintiffs, said last week that he had no doubt the city would appeal.

"But if they simply appeal, they're going to waste nine, 10 months, and they won't have any residential plan in place," he said. "If they want to waste their time on appeal, they will lose because there is no way they're reversing a 46-page opinion."

Timeline of the 2040 Plan lawsuit:

Dec. 2018: The Audubon Chapter of Minneapolis, Minnesota Citizens for the Protection of Migratory Birds and Smart Growth Minneapolis sued the city of Minneapolis, arguing the proposed 2040 Comprehensive Plan would pollute natural resources. Three days later, the City Council approved the 2040 Plan.

May 2019: Klein dismissed the lawsuit. He found the law didn't require the city to conduct an environmental review of the 2040 Plan before approval, and that there wasn't evidence for claims that the plan posed an environmental threat.

Jan. 2020: The plan went into effect, eliminating single-family zoning across the city.

March 2020: The Court of Appeals affirmed the District Court's decision to dismiss.

Feb. 2021: A turning point in the case came when the Minnesota Supreme Court revived the lawsuit, ruling it had established a link between the 2040 Plan and potential environmental pollution. The court found the plaintiffs could sue under the Minnesota Environmental Rights Act (MERA) even if the separate Minnesota Environmental Policy Act (MEPA) excused cities from conducting environmental reviews while adopting comprehensive plans. The case returned to the District Court.

June 2022: Klein ordered Minneapolis to stop implementing the 2040 Plan and revert back to its 2030 Comprehensive Plan. He found the city failed to raise an affirmative defense to the plaintiffs' expert testimony that the maximum densification allowed by the 2040 Plan would be environmentally destructive. The order was halted while the city appealed.

Dec. 2022: The Court of Appeals affirmed Klein's analysis of state law but reversed the part of his order that suspended the 2040 Plan, saying the district judge needed to thoroughly explain why the 2030 Plan would be any less environmentally destructive.

April: The city appealed the courts' finding that it should conduct an environmental review of the 2040 Plan under MERA to the Minnesota Supreme Court, but the Supreme Court declined to review the case again.

September: Klein again ordered the city to stop implementing the 2040 Plan and revert to the 2030 Plan, this time offering more detail. The city is now appealing again.