HF 2235

as introduced - 93rd Legislature (2023 - 2024) Posted on 03/09/2023 03:54pm

A bill for an act
relating to local and metropolitan government; the Legalizing Affordable Housing
Act; addressing provisions on land use and planning requirements; amending
Minnesota Statutes 2022, sections 15.99, subdivisions 1, 2; 326B.145; 326B.153,
by adding a subdivision; 394.24, subdivision 1; 462.355, subdivision 4; 462.357,
subdivisions 1, 2, by adding a subdivision; 462.358, subdivisions 2a, 2b; 473.145;
473.254, subdivision 2; 473.517, subdivision 3; 473.858, subdivision 1; 473.859,
subdivision 2; 473.865, subdivisions 2, 3; proposing coding for new law in
Minnesota Statutes, chapters 394; 462; 473; 513; proposing coding for new law
as Minnesota Statutes, chapter 462E; repealing Laws 2017, First Special Session
chapter 3, article 3, section 126; Laws 2018, chapter 214, article 2, section 46.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

ARTICLE 1

IMPACT FEES

Section 1.

new text begin [394.245] IMPACT FEES.
new text end

new text begin If a board has adopted a comprehensive plan that meets the requirements of this chapter
and has adopted a capital improvement program, it may impose impact fees as provided in
chapter 462E.
new text end

Sec. 2.

new text begin [462.3594] IMPACT FEES.
new text end

new text begin A statutory or home rule charter city that has adopted a comprehensive municipal plan
and capital improvement program, as provided in this chapter, may impose impact fees as
provided in chapter 462E.
new text end

Sec. 3.

new text begin [462E.01] IMPACT FEES; DEFINITIONS.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin For the purposes of this chapter, the following terms have
the meanings given.
new text end

new text begin Subd. 2. new text end

new text begin Applicable planning law. new text end

new text begin "Applicable planning law" means chapter 394 for
counties and sections 462.351 to 462.364 for statutory and home rule charter cities and
towns.
new text end

new text begin Subd. 3. new text end

new text begin District. new text end

new text begin "District" means the area of the new development on which an impact
fee is imposed by a local government, pursuant to an ordinance.
new text end

new text begin Subd. 4. new text end

new text begin Impact fee. new text end

new text begin "Impact fee" means a fee imposed on a new development by a
local government, pursuant to an ordinance, to pay for capital improvements necessitated
by the new development that will primarily benefit the new development.
new text end

new text begin Subd. 5. new text end

new text begin Local government. new text end

new text begin "Local government" means a statutory or home rule charter
city, town, or county.
new text end

new text begin Subd. 6. new text end

new text begin Metropolitan area. new text end

new text begin "Metropolitan area" has the meaning given in section
473.121, subdivision 2.
new text end

new text begin Subd. 7. new text end

new text begin Project. new text end

new text begin "Project" means the purpose for which an impact fee is imposed on a
district.
new text end

Sec. 4.

new text begin [462E.02] AUTHORITY.
new text end

new text begin A local government may impose impact fees by ordinance as provided for by other law
in the interest of furthering orderly and staged development of land within the local
government's jurisdiction and the metropolitan area, if applicable.
new text end

Sec. 5.

new text begin [462E.03] PERMITTED USES.
new text end

new text begin (a) A local ordinance must specify the purposes for which impact fees may be imposed
on a new development. A local ordinance may provide for fees to be imposed for any of
the following purposes:
new text end

new text begin (1) transportation infrastructure, including public transit;
new text end

new text begin (2) water supply production and distribution;
new text end

new text begin (3) wastewater collection and treatment facilities;
new text end

new text begin (4) school facilities;
new text end

new text begin (5) parks, open space, and recreation facilities;
new text end

new text begin (6) public safety facilities, including but not limited to police, fire, and emergency
medical and rescue facilities;
new text end

new text begin (7) stormwater control and treatment;
new text end

new text begin (8) solid waste collection and disposal; and
new text end

new text begin (9) lighting.
new text end

new text begin (b) A project that falls under one or more purposes under paragraph (a) must be described
in the local government's approved comprehensive plan and capital improvement plan. The
capital improvement plan must provide:
new text end

new text begin (1) the estimated cost of the project;
new text end

new text begin (2) the planned start and end dates of the project; and
new text end

new text begin (3) an estimate of the portion of the project cost that will be financed using an impact
fee.
new text end

Sec. 6.

new text begin [462E.04] ESTABLISHMENT OF DISTRICT; PAYMENT OF FEE.
new text end

new text begin (a) A district is established upon the completion of the design of the project that will be
funded in whole or in part with an impact fee, and the approval of the governing body of
the local government imposing the impact fee.
new text end

new text begin (b) The impact fee is due and payable from the owners of property located in the district
immediately upon the establishment of the district and the issuance of notice under section
462E.09. Failure to receive the notice shall not postpone or excuse any default.
new text end

new text begin (c) An owner of property in the district must make payment within 90 days of the
establishment of the district under this section. The governing body of the local government
imposing the impact fee must provide the owners of property in the district the option of
paying an impact fee over a period of up to ten years at an interest rate that reflects the local
government's own cost of borrowing.
new text end

Sec. 7.

new text begin [462E.05] FORMULA; CONTRIBUTIONS.
new text end

new text begin A local impact fee ordinance must specify the formula by which the costs of the project
will be apportioned among the properties in the district. The formula must result in fee
amounts that are just and equitable. The formula for determining impact fees for a particular
district must provide for credits off-setting part or all of the fees that reflect what the new
development in the district may have contributed in the form of taxes, other fees, dedications,
or other contributions toward the improvement for which the impact fees are imposed.
new text end

Sec. 8.

new text begin [462E.06] ADVISORY COMMITTEE.
new text end

new text begin A local government that imposes an impact fee must establish an impact fee advisory
committee consisting of representatives of affected interests to assist in the development of
the ordinance.
new text end

Sec. 9.

new text begin [462E.07] EXEMPTIONS.
new text end

new text begin An impact fee ordinance may provide exemptions from an impact fee for projects
providing low- and moderate-income housing if the need for such housing is identified in
the comprehensive plan.
new text end

Sec. 10.

new text begin [462E.08] SEGREGATION OF FEES; REFUND.
new text end

new text begin (a) Revenues from impact fees must be placed in a separate account and used only for
projects that meet the criteria of section 462E.03.
new text end

new text begin (b) A local government that imposes an impact fee must refund any impact fee it has
not spent by the time a project is complete to the parties who paid the fee. Within 90 days
of the completion of the project, the treasurer of the local government that imposed the
impact fee must refund the impact fee in the amount proportional to the payment by the
party.
new text end

Sec. 11.

new text begin [462E.09] NOTICE; RECORDING.
new text end

new text begin All impact fees paid or due must be recorded and a purchaser of real property must be
notified of any impact fees paid or due.
new text end

Sec. 12.

new text begin [462E.10] MODEL IMPACT FEE ORDINANCE.
new text end

new text begin The League of Minnesota Cities, in collaboration with other stakeholders, including but
not limited to the Minnesota Chapter of the American Planning Association, the City
Engineers Association of Minnesota, and Housing First, must develop a model impact fee
ordinance for local governments on or before December 31, 2023.
new text end

ARTICLE 2

ENVIRONMENTAL REVIEW AND COMPREHENSIVE LAND PLANNING

Section 1.

Minnesota Statutes 2022, section 473.145, is amended to read:

473.145 DEVELOPMENT GUIDE.

new text begin (a) new text end The Metropolitan Council shall prepare and adopt, after appropriate study and such
public hearings as may be necessary, a comprehensive development guide for the
metropolitan area. It shall consist of a compilation of policy statements, goals, standards,
programs, and maps prescribing guides for the orderly and economical development, public
and private, of the metropolitan area. The comprehensive development guide shall recognize
and encompass physical, social, or economic needs of the metropolitan area and those future
developments which will have an impact on the entire area including but not limited to such
matters as land use, parks and open space land needs, the necessity for and location of
airports, highways, transit facilities, public hospitals, libraries, schools, and other public
buildings.

new text begin (b) The council's adoption and amendment of the comprehensive development guide
and its adoption and amendment of metropolitan system plans as defined in section 473.852,
subdivision 8, other policy plans, and metropolitan system statements under this chapter
shall not constitute conduct that causes or is likely to cause pollution, impairment, or
destruction as defined under section 116B.02, subdivision 5, or governmental action as
defined under section 116D.04, subdivision 1a, paragraph (d).
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

Sec. 2.

new text begin [473.8651] ENVIRONMENTAL REVIEW.
new text end

new text begin Notwithstanding any environmental review required under section 116D.04 and
Minnesota Rules, chapter 4410, the adoption or amendment of comprehensive plans and
the adoption or amendment of fiscal devices and official controls consistent with sections
473.858 to 473.865 shall not constitute conduct that causes or is likely to cause pollution,
impairment, or destruction, as defined under section 116B.02, subdivision 5.
new text end

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective retroactively from
March 1, 2018, and applies to actions commenced on or after that date. This section applies
in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.
new text end

ARTICLE 3

PLANNING AND ZONING

Section 1.

Minnesota Statutes 2022, section 394.24, subdivision 1, is amended to read:

Subdivision 1.

Adopted by ordinance.

Official controls which shall further the purpose
and objectives of the comprehensive plan and parts thereof shall be adopted by ordinance.
The comprehensive plan must provide guidelines for the timing and sequence of the adoption
of official controls to ensure planned, orderly, and staged development and redevelopment
consistent with the comprehensive plan. new text begin Official controls do not conflict with a
comprehensive plan if they permit all of the uses that are permitted or required in the
comprehensive plan at the densities permitted or required by the comprehensive plan, and
they prohibit all of the uses that are expressly prohibited by the comprehensive plan. Official
controls for land guided for commercial or industrial use may be more specific than the
comprehensive plan regarding the kinds of commercial or industrial uses that are allowed
in specific locations.
new text end

Sec. 2.

Minnesota Statutes 2022, section 462.355, subdivision 4, is amended to read:

Subd. 4.

Interim ordinance.

(a) If a municipality is conducting studies or has authorized
a study to be conducted or has held or has scheduled a hearing for the purpose of considering
adoption or amendment of a comprehensive plan or official controls as defined in section
462.352, subdivision 15, or if new territory for which plans or controls have not been adopted
is annexed to a municipality, the governing body of the municipality may adopt an interim
ordinance applicable to all or part of its jurisdiction for the purpose of protecting the planning
process and the health, safety and welfare of its citizens. The interim ordinance may regulate,
restrict, or prohibit any use, development, or subdivision within the jurisdiction or a portion
thereof for a period not to exceed one year from the date it is effective.

(b) If a proposed interim ordinance purports to regulate, restrict, or prohibit activities
relating to livestock production, a public hearing must be held following a ten-day notice
given by publication in a newspaper of general circulation in the municipality before the
interim ordinance takes effect.

(c)(1) A statutory or home rule charter city may adopt an interim ordinance that regulates,
restricts, or prohibits a housing proposal only if the ordinance is approved by majority vote
of all members of the city council. new text begin A housing proposal that is consistent with the
comprehensive plan on the date of submission and is submitted or pending before the
adoption of an interim ordinance under this subdivision is exempt from the regulations,
restrictions, or prohibitions in the interim ordinance.
new text end

(2) Before adopting the interim ordinance, the city council must hold a public hearing
after providing written notice to any person who has submitted a housing proposal, has a
pending housing proposal, or has provided a written request to be notified of interim
ordinances related to housing proposals. The written notice must be provided at least three
business days before the public hearing. Notice also must be posted on the city's official
website, if the city has an official website.

(3) The date of the public hearing shall be the earlier of the next regularly scheduled
city council meeting after the notice period or within ten days of the notice.

(4) The activities proposed to be restricted by the proposed interim ordinance may not
be undertaken before the public hearing.

(5) For the purposes of this paragraph, "housing proposal" means a written request for
city approval of a project intended primarily to provide residential dwellings, either single
family or multi-family, and involves the subdivision or development of land or the
demolition, construction, reconstruction, alteration, repair, or occupancy of residential
dwellings.

(d) The period of an interim ordinance applicable to an area that is affected by a city's
master plan for a municipal airport may be extended for such additional periods as the
municipality may deem appropriate, not exceeding a total additional period of 18 months.
In all other cases, no interim ordinance may halt, delay, or impede a subdivision that has
been given preliminary approval, nor may any interim ordinance extend the time deadline
for agency action set forth in section 15.99 with respect to any application filed prior to the
effective date of the interim ordinance. The governing body of the municipality may extend
the interim ordinance after a public hearing and written findings have been adopted based
upon one or more of the conditions in clause (1), (2), or (3). The public hearing must be
held at least 15 days but not more than 30 days before the expiration of the interim ordinance,
and notice of the hearing must be published at least ten days before the hearing. The interim
ordinance may be extended for the following conditions and durations, but, except as
provided in clause (3), an interim ordinance may not be extended more than an additional
18 months:

(1) up to an additional 120 days following the receipt of the final approval or review by
a federal, state, or metropolitan agency when the approval is required by law and the review
or approval has not been completed and received by the municipality at least 30 days before
the expiration of the interim ordinance;

(2) up to an additional 120 days following the completion of any other process required
by a state statute, federal law, or court order, when the process is not completed at least 30
days before the expiration of the interim ordinance; or

(3) up to an additional one year if the municipality has not adopted a comprehensive
plan under this section at the time the interim ordinance is enacted.

Sec. 3.

Minnesota Statutes 2022, section 462.357, subdivision 2, is amended to read:

Subd. 2.

General requirements.

(a) At any time after the adoption of a land use plan
for the municipality, the planning agency, for the purpose of carrying out the policies and
goals of the land use plan, may prepare a proposed zoning ordinance and submit it to the
governing body with its recommendations for adoption.

(b) Subject to the requirements of subdivisions 3, 4, and 5, the governing body may
adopt and amend a zoning ordinance by a majority vote of all its members. The adoption
or amendment of any portion of a zoning ordinance which changes all or part of the existing
classification of a zoning district from residential to either commercial or industrial requires
a two-thirds majority vote of all members of the governing body.

(c) The land use plan must provide guidelines for the timing and sequence of the adoption
of official controls to ensure planned, orderly, and staged development and redevelopment
consistent with the land use plan. new text begin Official controls do not conflict with a land use plan if
they permit all of the uses that are permitted or required in the land use plan at the densities
permitted or required by the land use plan, and they prohibit all of the uses that are expressly
prohibited by the land use plan. Official controls for land guided for commercial or industrial
use may be more specific than the comprehensive plan regarding the kinds of commercial
or industrial uses that are allowed in specific locations.
new text end

Sec. 4.

Minnesota Statutes 2022, section 462.358, subdivision 2a, is amended to read:

Subd. 2a.

Terms of regulations.

new text begin (a) new text end The standards and requirements in the regulations
may address without limitation: the size, location, grading, and improvement of lots,
structures, public areas, streets, roads, trails, walkways, curbs and gutters, water supply,
storm drainage, lighting, sewers, electricity, gas, and other utilities; the planning and design
of sites; access to solar energy; and the protection and conservation of floodplains, shore
lands, soils, water, vegetation, energy, air quality, and geologic and ecologic features. The
regulations shall require that subdivisions be consistent with the municipality's official map
if one exists and its zoning ordinance, and may require consistency with other official
controls and the comprehensive plan. The regulations may prohibit certain classes or kinds
of subdivisions in areas where prohibition is consistent with the comprehensive plan and
the purposes of this section, particularly the preservation of agricultural lands. The regulations
may prohibit, restrict or control development for the purpose of protecting and assuring
access to direct sunlight for solar energy systems. The regulations may prohibit the issuance
of permits or approvals for any tracts, lots, or parcels for which required subdivision approval
has not been obtained.

new text begin (b) Regulations do not conflict with a comprehensive plan if they permit all of the uses
that are permitted or required in the comprehensive plan at the densities permitted or required
by the comprehensive plan, and they prohibit all of the uses that are expressly prohibited
by the comprehensive plan. Regulations for land guided for commercial or industrial use
may be more specific than the comprehensive plan regarding the kinds of commercial or
industrial uses which are allowed in specific locations.
new text end

new text begin (c) new text end The regulations may permit the municipality to condition its approval on the
construction and installation of sewers, streets, electric, gas, drainage, and water facilities,
and similar utilities and improvements or, in lieu thereof, on the receipt by the municipality
of a cash deposit, certified check, irrevocable letter of credit, bond, or other financial security
in an amount and with surety and conditions sufficient to assure the municipality that the
utilities and improvements will be constructed or installed according to the specifications
of the municipality. Sections 471.345 and 574.26 do not apply to improvements made by
a subdivider or a subdivider's contractor.

new text begin (d) new text end A municipality may require that an applicant establish an escrow account or other
financial security for the purpose of reimbursing the municipality for direct costs relating
to professional services provided during the review, approval and inspection of the project.
A municipality may only charge the applicant a rate equal to the value of the service to the
municipality. Services provided by municipal staff or contract professionals must be billed
at an established rate.

new text begin (e) new text end When the applicant vouches, by certified letter to the municipality, that the conditions
required by the municipality for approval under this subdivision have been satisfied, the
municipality has 30 days to release and return to the applicant any and all financial securities
tied to the requirements. If the municipality fails to release and return the letters of credit
within the 30-day period, any interest accrued will be paid to the applicant. If the municipality
determines that the conditions required for approval under this subdivision have not been
satisfied, the municipality must send written notice within seven business days upon receipt
of the certified letter indicating to the applicant which specific conditions have not been
met. The municipality shall require a maintenance or performance bond from any
subcontractor that has not yet completed all remaining requirements of the municipality.

new text begin (f) new text end The regulations may permit the municipality to condition its approval on compliance
with other requirements reasonably related to the provisions of the regulations and to execute
development contracts embodying the terms and conditions of approval. The municipality
may enforce such agreements and conditions by appropriate legal and equitable remedies.

Sec. 5.

Minnesota Statutes 2022, section 473.254, subdivision 2, is amended to read:

Subd. 2.

Affordable, life-cycle goals.

new text begin (a) new text end The council shall negotiate with each
municipality to establish affordable and life-cycle housing goals for that municipality that
are consistent with and promote the policies of the Metropolitan Council as provided in the
adopted Metropolitan Development Guide. The council shall adopt, by resolution after a
public hearing, the negotiated affordable and life-cycle housing goals for each municipality
by January 15, 1996, and by January 15 in each succeeding year for each municipality newly
electing to participate in the program or for each municipality with which new housing
goals have been negotiated. By June 30, 1996, and by June 30 in each succeeding year for
each municipality newly electing to participate in the program or for each municipality with
which new housing goals have been negotiated, each municipality shall identify to the
council the actions it plans to take to meet the established housing goals.

new text begin (b) Only parcels that are consistent with and promote the policies of the Metropolitan
Development Guide and are zoned for multifamily housing at the guided level of density
may qualify toward a municipality's affordable and life-cycle housing goals under this
subdivision.
new text end

new text begin APPLICATION. new text end

new text begin This section applies in the counties of Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott, and Washington.
new text end

Sec. 6.

Minnesota Statutes 2022, section 473.858, subdivision 1, is amended to read:

Subdivision 1.

No conflicting zoning, fiscal device, official control.

Within nine months
following the receipt of a metropolitan system statement for an amendment to a metropolitan
system plan and within three years following the receipt of a metropolitan system statement
issued in conjunction with the decennial review required under section 473.864, subdivision
2, every local governmental unit shall have reviewed and, if necessary, amended its
comprehensive plan in accordance with sections 462.355, 473.175, and 473.851 to 473.871
and the applicable planning statute and shall have submitted the plan to the Metropolitan
Council for review pursuant to section 473.175. The provisions of sections 462.355, 473.175,
and 473.851 to 473.871 shall supersede the provisions of the applicable planning statute
wherever a conflict may exist. If the comprehensive municipal plan is in conflict with the
zoning ordinance, the zoning ordinance shall be brought into conformance with the plan by
local government units in conjunction with the review and, if necessary, amendment of its
comprehensive plan required under section 473.864, subdivision 2. A local government
unit shall not adopt any fiscal device or official control which is in conflict with its
comprehensive plan, including any amendments to the plan, or which permits activity in
conflict with metropolitan system plans, as defined by section 473.852, subdivision 8. The
comprehensive plan shall provide guidelines for the timing and sequence of the adoption
of official controls to ensure planned, orderly, and staged development and redevelopment
consistent with the comprehensive plan. For purposes of this section, a fiscal device or
official control shall not be considered to be in conflict with a local government unit's
comprehensive plan or to permit an activity in conflict with metropolitan system plans if
such fiscal device or official control is adopted to ensure the planned, orderly, and staged
development of urbanization or redevelopment areas designated in the comprehensive plan
pursuant to section 473.859, subdivision 5. new text begin Fiscal devices and official controls do not conflict
with a comprehensive plan if they permit all of the uses that are permitted or required in
the comprehensive plan at the densities permitted or required by the comprehensive plan,
and they prohibit all of the uses that are expressly prohibited by the comprehensive plan.
Fiscal devices and official controls for land guided for commercial or industrial use may
be more specific than the comprehensive plan regarding the kinds of commercial or industrial
uses that are allowed in specific locations.
new text end

new text begin APPLICATION. new text end

new text begin This section applies in the counties of Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott, and Washington.
new text end

Sec. 7.

Minnesota Statutes 2022, section 473.865, subdivision 2, is amended to read:

Subd. 2.

No conflict with plans.

A local governmental unit shall not adopt any official
control or fiscal device which is in conflict with its comprehensive plan or which permits
activity in conflict with metropolitan system plans. new text begin Fiscal devices and official controls do
not conflict with a comprehensive plan if they permit all of the uses that are permitted or
required in the comprehensive plan at the densities permitted or required by the
comprehensive plan, and they prohibit all of the uses that are expressly prohibited by the
comprehensive plan. Fiscal devices and official controls for land guided for commercial or
industrial use may be more specific than the comprehensive plan regarding the kinds of
commercial or industrial uses that are allowed in specific locations.
new text end

new text begin APPLICATION. new text end

new text begin This section applies in the counties of Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott, and Washington.
new text end

Sec. 8.

Minnesota Statutes 2022, section 473.865, subdivision 3, is amended to read:

Subd. 3.

Amendments.

If an official control conflicts with a comprehensive plan as the
result of an amendment to the plan, the official control shall be amended by the unit within
nine months following the amendment to the plan so as to not conflict with the amended
comprehensive plan. new text begin If a development application is submitted that is not in conflict with
the comprehensive plan, it must be processed in accordance with section 15.99.
new text end

new text begin APPLICATION. new text end

new text begin This section applies in the counties of Anoka, Carver, Dakota,
Hennepin, Ramsey, Scott, and Washington.
new text end

ARTICLE 4

LIMITING REGULATIONS ON RESIDENTIAL DEVELOPMENT

Section 1.

Minnesota Statutes 2022, section 462.357, subdivision 1, is amended to read:

Subdivision 1.

Authority for zoning.

For the purpose of promoting the public health,
safety, morals, and general welfare, a municipality may by ordinance regulate on the earth's
surface, in the air space above the surface, and in subsurface areas, the location, height,
width, bulk, type of foundation, number of stories, size of buildings and other structures,
the percentage of lot which may be occupied, the size of yards and other open spaces, the
density and distribution of population, the uses of buildings and structures for trade, industry,
residence, recreation, public activities, or other purposes, and the uses of land for trade,
industry, residence, recreation, agriculture, forestry, soil conservation, water supply
conservation, conservation of shorelands, as defined in sections 103F.201 to 103F.221,
access to direct sunlight for solar energy systems as defined in section 216C.06, flood control
or other purposes, and may establish standards and procedures regulating such uses. To
accomplish these purposes, official controls may include provision for purchase of
development rights by the governing body in the form of conservation easements under
chapter 84C in areas where the governing body considers preservation desirable and the
transfer of development rights from those areas to areas the governing body considers more
appropriate for development. No regulation may prohibit earth sheltered construction as
defined in section 216C.06, subdivision 14, relocated residential buildings, deleted text begin or deleted text end manufactured
homes built in conformance with sections 327.31 to 327.35 new text begin , or industrialized or modular
buildings for residential use built in conformance with Minnesota Rules, chapter 1361, new text end that
comply with all other zoning ordinances promulgated pursuant to this section. The regulations
may divide the surface, above surface, and subsurface areas of the municipality into districts
or zones of suitable numbers, shape, and area. The regulations shall be uniform for each
class or kind of buildings, structures, or land and for each class or kind of use throughout
such district, but the regulations in one district may differ from those in other districts. The
ordinance embodying these regulations shall be known as the zoning ordinance and shall
consist of text and maps. A city may by ordinance extend the application of its zoning
regulations to unincorporated territory located within two miles of its limits in any direction,
but not in a county or town which has adopted zoning regulations; provided that where two
or more noncontiguous municipalities have boundaries less than four miles apart, each is
authorized to control the zoning of land on its side of a line equidistant between the two
noncontiguous municipalities unless a town or county in the affected area has adopted
zoning regulations. Any city may thereafter enforce such regulations in the area to the same
extent as if such property were situated within its corporate limits, until the county or town
board adopts a comprehensive zoning regulation which includes the area.

Sec. 2.

Minnesota Statutes 2022, section 462.357, is amended by adding a subdivision to
read:

new text begin Subd. 7a. new text end

new text begin Two-family property; permitted use. new text end

new text begin A two-family property is a permitted
use in all areas zoned for single-family residential use and in any residential subdivision
development provided the two-family property complies with all municipal standards. For
the purposes of this subdivision, a two-family property includes but is not limited to a duplex
or a single-family property with an accessory dwelling unit. Any standards, performance
conditions, or requirements imposed by the municipality for properties permitted under this
subdivision must reasonably relate to protecting the public health, safety, and general welfare.
new text end

Sec. 3.

new text begin [462.3575] LIMITING REGULATIONS ON RESIDENTIAL
DEVELOPMENT.
new text end

new text begin Subdivision 1. new text end

new text begin Application. new text end

new text begin This section applies to official controls adopted under
sections 462.357, 462.358, and 462.3595 governing residential development.
new text end

new text begin Subd. 2. new text end

new text begin Planned unit development. new text end

new text begin (a) A municipality must not require a planned unit
development agreement in lieu of a proposed residential development if the proposed
residential development complies with existing city zoning ordinances or subdivision
regulations, or qualifies as a conditional use.
new text end

new text begin (b) A planned unit development agreement must be made available to the public by
posting the agreement on the website of the municipality at least seven days prior to the
governing body's review of the agreement. If the municipality does not have a website, a
copy of the planned unit development agreement must be available for review at the city
hall building of the municipality.
new text end

new text begin (c) If the agreement is approved by the governing body, the agreement cannot be modified
unless all parties to the agreement concur.
new text end

new text begin Subd. 3. new text end

new text begin Limitation on aesthetic mandates. new text end

new text begin A municipality must not condition approval
of a residential building permit, subdivision development, or planned unit development on
the use of specific materials for aesthetic reasons for property subject to the Minnesota
Residential Code under Minnesota Rules, chapter 1309.
new text end

new text begin Subd. 4. new text end

new text begin Limitation on square footage; accessory structures. new text end

new text begin (a) A municipality must
not require a minimum square footage for a residential building or accessory structure to a
residential building.
new text end

new text begin (b) A municipality must not require more than one garage stall for a single-family
dwelling.
new text end

ARTICLE 5

MUNICIPAL DEDICATION FEES

Section 1.

Minnesota Statutes 2022, section 462.358, subdivision 2b, is amended to read:

Subd. 2b.

Dedication.

(a) The regulations may require that a reasonable portion of the
buildable land, as defined by municipal ordinance, of any proposed subdivision be dedicated
to the public or preserved for public use as streets, roads, new text begin sidewalks, new text end sewers, electric, gas,
and water facilities, stormwater drainage and holding areas or ponds and similar utilities
and improvements, parks, recreational facilities as defined in section 471.191, playgrounds,
trails, wetlands, or open space. The requirement must be imposed by ordinance or under
the procedures established in section 462.353, subdivision 4a.

(b) If a municipality adopts the ordinance or proceeds under section 462.353, subdivision
4a, as required by paragraph (a), the municipality must adopt a capital improvement budget
and have a parks and open space plan or have a parks, trails, and open space component in
its comprehensive plan subject to the terms and conditions in this paragraph and paragraphs
(c) to (i).

(c) The municipality may choose to accept a cash fee as set by ordinance from the
applicant for some or all of the new lots created in the subdivision, based on the average
fair market value of the unplatted land for which park fees have not already been paid that
is, no later than at the time of final approval or under the city's adopted comprehensive plan,
to be served by municipal sanitary sewer and water service or community septic and private
well as authorized by state law. For purposes of redevelopment on developed land, the
municipality may choose to accept a cash fee based on fair market value of the land no later
than the time of final approval. "Fair market value" means the value of the land as determined
by the municipality annually based on tax valuation or other relevant data. If the
municipality's calculation of valuation is objected to by the applicant, then the value shall
be as negotiated between the municipality and the applicant, or based on the market value
as determined by the municipality based on an independent appraisal of land in a same or
similar land use category.

(d) In establishing the portion to be dedicated or preserved or the cash fee, the regulations
shall give due consideration to the open space, recreational, or common areas and facilities
open to the public that the applicant proposes to reserve for the subdivision.

(e) The municipality must reasonably determine that it will need to acquire that portion
of land for the purposes stated in this subdivision as a result of approval of the subdivision.

(f) Cash payments received must be placed by the municipality in a special fund to be
used only for the purposes for which the money was obtained. new text begin The municipality must
maintain records detailing the purposes for which the money was obtained and the manner
in which the municipality spent the money to further those purposes. The municipality must
make the records readily available to the applicant upon request.
new text end

(g) Cash payments received must be used only for the acquisition and development or
improvement of parks, recreational facilities, playgrounds, trails, wetlands, or open space
based on the approved park systems plan. Cash payments must not be used for ongoing
operation or maintenance of parks, recreational facilities, playgrounds, trails, wetlands, or
open space. new text begin The municipality must maintain records demonstrating the manner in which
the municipality used each cash payment.
new text end

(h) The municipality must not deny the approval of a subdivision based solely on an
inadequate supply of parks, open spaces, trails, or recreational facilities within the
municipality.

(i) Previously subdivided property from which a park dedication has been received,
being resubdivided with the same number of lots, is exempt from park dedication
requirements. If, as a result of resubdividing the property, the number of lots is increased,
then the park dedication or per-lot cash fee must apply only to the net increase of lots.

new text begin (j) The municipality may accept a combination of buildable land and cash fees to satisfy
the municipality's dedication requirements set by ordinance pursuant to this subdivision or
the procedures established in section 462.353, subdivision 4a. The municipality may require
buildable land, cash fees, or a combination of both, to be dedicated for the purposes described
in paragraph (a), the total value of which must not exceed ten percent of the fair market
value of the proposed subdivision. Land in the proposed subdivision that is not buildable
may be dedicated, and the value of that land is not factored into the ten percent limit on the
total value of the dedication. Land in the proposed subdivision that is dedicated because of
its current or potential use for regional trails applies to the ten percent limit on the total
value of the dedication unless the land is already dedicated for street, road, or right-of-way
purposes.
new text end

new text begin (k) The municipality must not require a dedication of land for streets, roads, or
right-of-way to a width that exceeds the minimum engineering standards for urban roadways,
as adopted in administrative rules by the commissioner of transportation for the municipal
state-aid street system, as provided under sections 162.09, subdivision 1, and 162.155.
new text end

new text begin (l) A dedication of land for a street that is not a collector or arterial street must not exceed
the amount of land required to construct the street with a curb-to-curb width of 32 feet and
associated utilities and sidewalks, if sidewalks are included in the plan for the proposed
subdivision. The municipality must apply guidance established by national traffic engineering
organizations when designing these streets.
new text end

ARTICLE 6

METROPOLITAN AREA DENSITY OF DEVELOPMENT

Section 1.

Minnesota Statutes 2022, section 473.859, subdivision 2, is amended to read:

Subd. 2.

Land use plan.

(a) A land use plan shall include the water management plan
required by section 103B.235, and shall designate the existing and proposed location,
intensity and extent of use of land and water, including lakes, wetlands, rivers, streams,
natural drainage courses, and adjoining land areas that affect water natural resources, for
agricultural, residential, commercial, industrial and other public and private purposes, or
any combination of such purposes.

(b) A land use plan shall contain a protection element, as appropriate, for historic sites,
the matters listed in the water management plan required by section 103B.235, and an
element for protection and development of access to direct sunlight for solar energy systems.

(c) A land use plan shall also include a housing element containing standards, plans and
programs for providing adequate housing opportunities to meet existing and projected local
and regional housing needs, including but not limited to the use of official controls and land
use planning to promote the availability of land for the development of low and moderate
income housing.

(d) A land use plan shall also include the local government's goals, intentions, and
priorities concerning aggregate and other natural resources, transportation infrastructure,
land use compatibility, habitat, agricultural preservation, and other planning priorities,
considering information regarding supply from the Minnesota Geological Survey Information
Circular No. 46.

new text begin (e) A land use plan and the related official controls shall provide for an average density
of residential development of no less than four units per acre for an area: (1) where the
municipality has not previously subdivided the area for residential development pursuant
to section 462.358, including areas identified as land that may come within the urban service
area for residential development; and (2) that is not connected to the metropolitan disposal
system. In the area guided for single-family homes, a minimum of 25 percent of the land
must allow for a minimum density of eight units per acre. The municipality must guide and
zone an area described in this paragraph that it intends to remain rural at a density of no
more than one unit per ten acres.
new text end

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective the day following
final enactment and applies to a land use plan amendment proposed on or after that date.
This section applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott,
and Washington.
new text end

ARTICLE 7

METROPOLITAN COUNCIL; SEWER AVAILABILITY CHARGES

Section 1.

Minnesota Statutes 2022, section 473.517, subdivision 3, is amended to read:

Subd. 3.

Allocation of treatment, interceptor costs; reserved capacity.

(a) In preparing
each budget the council shall estimate the current costs of acquisition, betterment, and debt
service, only, of the treatment works in the metropolitan disposal system which will not be
used to total capacity during the budget year, and the percentage of such capacity which
will not be used, and shall deduct the same percentage of such treatment works costs from
the current costs allocated under subdivision 1. The council shall also estimate the current
costs of acquisition, betterment, and debt service, only, of the interceptors in the metropolitan
disposal system that will not be used to total capacity during the budget year, shall estimate
the percentage of the total capacity that will not be used, and shall deduct the same percentage
of interceptor costs from the current costs allocated under subdivision 1. The total amount
so deducted with respect to all treatment works and interceptors in the system shall be
allocated among and paid by the respective local government units in the metropolitan area
through a metropolitan sewer availability charge for each new connection or increase in
capacity demand to the metropolitan disposal system within each local government unit.
Amounts collected through the metropolitan sewer availability charge (SAC) must be
deposited in the council's wastewater reserve capacity fund. Each fiscal year an amount
from the wastewater reserve capacity fund shall be transferred to the wastewater operating
fund for the reserved capacity costs described in this paragraph. For the purposes of this
subdivision, the amount transferred from the wastewater reserve capacity fund to the
wastewater operating fund shall be referred to as the "SAC transfer amount."

(b) The council will record on a cumulative basis the total SAC transfer deficit. In any
year that the wastewater reserve capacity fund has a year-end balance of at least two years'
estimated SAC transfer amount, the council shall increase the subsequent annual SAC
transfer amount in excess of the amount required by paragraph (a) with the goal of eliminating
the cumulative total SAC transfer deficit. The annual amount by which the council increases
the SAC transfer amount shall be determined by the council after appropriate study and a
public hearing.

new text begin (c) The council shall adjust the SAC charge so that development in unsewered areas is
assessed at actual density, but no less than four SAC units per acre.
new text end

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective January 1, 2024, and
applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.
new text end

ARTICLE 8

BUILDING PERMIT DEADLINES

Section 1.

Minnesota Statutes 2022, section 15.99, subdivision 1, is amended to read:

Subdivision 1.

Definitions.

(a) For purposes of this section, the following terms shall
have the meanings given.

(b) "Agency" means a department, agency, board, commission, or other group in the
executive branch of state government; a statutory or home rule charter city, county, town,
or school district; any metropolitan agency or regional entity; and any other political
subdivision of the state.

(c) "Request" means a written application new text begin for a building permit or a written application
new text end related to zoning, septic systems, watershed district review, soil and water conservation
district review, or the expansion of the metropolitan urban service area, for a permit, license,
or other governmental approval of an action. A request must be submitted in writing to the
agency on an application form provided by the agency, if one exists. The agency may reject
as incomplete a request not on a form of the agency if the request does not include
information required by the agency. A request not on a form of the agency must clearly
identify on the first page the specific permit, license, or other governmental approval being
sought. No request shall be deemed made if not in compliance with this paragraph.

(d) "Applicant" means a person submitting a request under this section. An applicant
may designate a person to act on the applicant's behalf regarding a request under this section
and any action taken by or notice given to the applicant's designee related to the request
shall be deemed taken by or given to the applicant.

Sec. 2.

Minnesota Statutes 2022, section 15.99, subdivision 2, is amended to read:

Subd. 2.

Deadline for response.

(a) Except as otherwise provided in this section, section
462.358, subdivision 3b, or 473.175, or chapter 505, and notwithstanding any other law to
the contrary, an agency must approve or deny within 60 days a written request new text begin for a building
permit or a written request new text end relating to zoning, septic systems, watershed district review, soil
and water conservation district review, or expansion of the metropolitan urban service area
for a permit, license, or other governmental approval of an action. new text begin Except as provided in
paragraph (b), new text end new text begin new text end Failure of an agency to deny a request within 60 days is approval of the
request. If an agency denies the request, it must state in writing the reasons for the denial
at the time that it denies the request.

new text begin (b) An agency must approve or deny a building application as expeditiously as possible.
Failure of an agency to deny a request for a building permit within 60 days is not an approval
of the request. An agency that approves or denies a building permit application more than
60 days from receipt of the application must refund all relevant permitting fees to the
applicant within five business days of the date of the decision on the application.
new text end

deleted text begin (b) deleted text end new text begin (c) new text end When a vote on a resolution or properly made motion to approve a request fails
for any reason, the failure shall constitute a denial of the request provided that those voting
against the motion state on the record the reasons why they oppose the request. A denial of
a request because of a failure to approve a resolution or motion does not preclude an
immediate submission of a same or similar request.

deleted text begin (c) deleted text end new text begin (d) new text end Except as provided in paragraph deleted text begin (b) deleted text end new text begin (c) new text end , if an agency, other than a multimember
governing body, denies the request, it must state in writing the reasons for the denial at the
time that it denies the request. If a multimember governing body denies a request, it must
state the reasons for denial on the record and provide the applicant in writing a statement
of the reasons for the denial. If the written statement is not adopted at the same time as the
denial, it must be adopted at the next meeting following the denial of the request but before
the expiration of the time allowed for making a decision under this section. The written
statement must be consistent with the reasons stated in the record at the time of the denial.
The written statement must be provided to the applicant upon adoption.

ARTICLE 9

BUILDING PERMIT FEES

Section 1.

Minnesota Statutes 2022, section 326B.153, is amended by adding a subdivision
to read:

new text begin Subd. 5. new text end

new text begin Valuation. new text end

new text begin The commissioner must establish a cost-per-square-foot valuation
of new and additions to one- and two-family buildings, townhouse buildings, and accessory
utility buildings for the purpose of setting building permit fees by municipalities.
new text end

ARTICLE 10

ENERGY COST DISCLOSURE

Section 1.

new text begin [513.62] ENERGY COST DISCLOSURE REQUIREMENT.
new text end

new text begin (a) A seller of residential real property must disclose to a prospective purchaser the total
cost of the usage of electricity, natural gas, and water over the previous 12-month period
of the property, along with information about how the cost compares to the average cost of
these utilities per residential household statewide. A utility company that provides electricity,
natural gas, or water to a residential property must provide the information described in this
paragraph at the request of the seller or the seller's authorized representative.
new text end

new text begin (b) A real estate listing for residential real property must include:
new text end

new text begin (1) the information described in paragraph (a); and
new text end

new text begin (2) the most recent Home Energy Rating System Index score of the property, if the
property has received a score.
new text end

ARTICLE 11

CONSTRUCTION AND DEVELOPMENT FEE REPORT

Section 1.

Minnesota Statutes 2022, section 326B.145, is amended to read:

326B.145 ANNUAL REPORT.

new text begin (a) new text end Each municipality shall annually report by June 30 to the department, in a format
prescribed by the department, all construction and development-related fees collected by
the municipality from developers, builders, and subcontractors if the cumulative fees collected
exceeded deleted text begin $5,000 deleted text end new text begin $7,000 new text end in the reporting year, except that, for reports due June 30, 2009,
to June 30, 2013, the reporting threshold is $10,000.

new text begin (b) new text end The report must include:

(1) the number and valuation of units for which fees were paid;

(2) the amount of building permit fees, plan review fees, administrative fees, engineering
fees, infrastructure fees, and other construction and development-related fees; and

(3) the expenses associated with the municipal activities for which fees were collected.

new text begin (c) new text end A municipality that fails to report to the department in accordance with this section
is subject to the remedies provided by section 326B.082.

ARTICLE 12

OAK GROVE, NOWTHEN LAND USE EXCEPTIONS REPEALED

Section 1. new text begin METROPOLITAN COUNCIL.
new text end

new text begin The Metropolitan Council must review and amend as appropriate its metropolitan
development guide, policy plans, and system statements to make them consistent with the
effect of the repeal of the special laws in section 2.
new text end

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective the day following
final enactment and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey,
Scott, and Washington.
new text end

Sec. 2. new text begin REPEALER.
new text end

new text begin Laws 2017, First Special Session chapter 3, article 3, section 126; and Laws 2018, chapter
214, article 2, section 46, new text end new text begin are repealed.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day following final enactment.
new text end

APPENDIX

Repealed Minnesota Session Laws: 23-03716

Laws 2017, First Special Session chapter 3, article 3, section 126

Sec. 126. new text begin OAK GROVE; COMPREHENSIVE PLAN. new text end

new text begin Subdivision 1. new text end

new text begin Oak Grove. new text end

new text begin Notwithstanding any law, metropolitan system plan, the 2015 system statement for the city of Oak Grove, or administrative law judge's decision to the contrary, the area of the city that was the subject of the administrative law judge's decision in OAH 5-2106-33226, dated May 10, 2016, is designated "rural residential" for the purposes of the city's comprehensive plan update. new text end

new text begin Subd. 2. new text end

new text begin Metropolitan Council. new text end

new text begin The Metropolitan Council shall conform its metropolitan development guide, system plans, and the system statement for the city of Oak Grove to accommodate the provisions in subdivision 1. new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective the day after the governing body of the city of Oak Grove and its chief clerical officer timely complete their compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3. This section applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington. new text end

Laws 2018, chapter 214, article 2, section 46

Sec. 46. new text begin NOWTHEN; COMPREHENSIVE PLAN. new text end

new text begin Notwithstanding any law, metropolitan system plan, or the 2015 system statement for the city of Nowthen, the Metropolitan Council shall conform its metropolitan development guide, system plans, and the system statement for the city of Nowthen to implement any changes requested by the city of Nowthen relating to the council's designation of part or all of the city for purposes of the metropolitan development guide, systems plans and statements, and the city's comprehensive plan. new text end

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective the day after the governing body of the city of Nowthen and its chief clerical officer timely complete their compliance with Minnesota Statutes, section 645.021, subdivisions 2 and 3. This section applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington. new text end