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RESOLUTION GRANTING RELATOR REBECCA MULENBURG’S MOTION TO STAY THE CITY COUNCIL’S MAY 8, 2023 DECISION REVERSING THE PLANNING COMMISSION’S DECISION TO GRANT THE PETITION FOR AN ENVIRONMENTAL ASSESSMENT WORKSHEET (EAW) FOR A HOTEL AT SUNDBY ROAD AND WEST PAGE STREET.
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CITY PROPOSAL:
RESOLVED, that the city council finds as follows:
(a) Pursuant to City Code Section 50-18.1, on July 18, 2022, Kinseth Hotel Corporation submitted an application requesting the city review and concur with a wetland boundary and type delineation for property at Sundby Road and West Page Street in Duluth; and
(b) The wetland application included a wetland delineation report for the property completed by a Minnesota certified wetland delineator (Note: The wetland delineation report text stated the parcel identification numbers for the property as 010-2710-04594, 010-2710-04590, 010-2710-04593, but failed to state that parcel 0101-2710- 04575 was also included in the delineation as shown in the “Delineation Area” on Figure 3 of the report); and
(c) Upon review of the wetland application and following consultation with the wetland technical evaluation panel, on August 24, 2022, the city issued a Notice of Decision approving the wetland boundary and type delineation; and
(d) Pursuant to City Code Section, 50-37, on August 10, 2022, Kinseth submitted an application (PL 22-143) for planning review for a hotel on the property, with final information constituting a complete application being submitted on September 7, 2022; and
(e) At its October 11, 2022, regular meeting, the planning commission, after considering public testimony and information from the applicant, approved the planning review with a vote of 7 yeas, 1 nay, and 0 abstentions; and
(f) On October 21, 2022, the city received a notice of appeal requesting the city council reverse the planning commission’s approval; and
(g) At its December 19, 2022, meeting the city council heard the appeal and found that the application for planning review met all applicable provisions of Chapter 50 of the city code and affirmed the decision of the planning commission to approve the planning review; and
(h) On March 14, 2023, the city received notification that the Environmental Quality Board had designated the city as the responsible governmental unit (RGU) to review a citizen’s Petition for an Environmental Assessment Worksheet (EAW) as the hotel project was still pending before the city because a building permit had not been issued; and
(i) Duluth City Code section 2-41 grants to the planning commission the authority to serve as the RGU and make final decisions on environmental reviews including a petition for an EAW; and
(j) At is April 11, 2023 meeting, the planning commission considered the Petition for an EAW and approved a motion to grant the EAW petition; and
(k) When the planning commission makes a final decision on an environmental review, Duluth Code Section 50-37.1.O(4) allows for appeals of final planning commission decisions to the city council if such appeal is filed within 10 days of the planning commission’s decision, and such appeal shall be heard at the city council’s next scheduled meeting following receipt of the appeal; and
(l) On April 14, 2023, pursuant to City Code Section 50-37.1.O(4), the city received an appeal from Kinseth Hotel Corporation requesting the city council reverse the planning commission’s approval of the Petition for an EAW and asserting the areas of concern stated in the Petition for an EAW had been fully considered previously in the administrative process; and
(m) At its May 8, 2023 meeting, the city council heard the appeal and found that the record does not support the planning commission’s findings and conclusions as set out in the planning commission’s April 11, 2023 motion to grant the Petition for an EAW. The city council found that there is not the potential for significant environmental effects reasonably expected to occur from the project, and that there is not a sufficient basis to require the preparation of an EAW. The city council therefore reversed the decision of the planning commission granting the Petition for an EAW; and
(n) On May 31, 2023, Relator Rebecca Mulenburg filed a certiorari appeal with the Minnesota Court of Appeals seeking to challenge the city council’s May 8, 2023 decision that an EAW is not required for the project proposed by Kinseth; and
(o) On May 31, 2023, Relator Rebecca Mulenburg also filed with the Minnesota Court of Appeals a motion to stay the city council’s May 8, 2023 decision pending the appeal; and
(p) On June 14, 2023, the Minnesota Court of Appeals denied the Relator’s motion to stay on the basis that the motion to stay must first be submitted to the city council as the decision-maker on the underlying matter. Minn. R. Civ. P. 108.02, subd. 2; see also Minn. R. Civ. App. P. 115.03; and
(q) On June 5, 2023, Relator Rebecca Mulenburg emailed a motion to stay to the Duluth city clerk and asked that the matter be set on for a hearing before the city council; and
(r) Following standard protocol, the city clerk scheduled the motion to stay for a hearing before the city council on June 26, 2023. The city clerk provided notice of the hearing to Relator Rebecca Mulenburg and the developer Kinseth; and
(s) In considering a motion to stay pending appeal, the city council must consider the relevant factors, including “whether the appeal raises substantial issues; injury to one or more parties absent a stay; and the public interest, which includes the effective administration of justice.” Webster v. Hennepin County, 891 N.W.2d 290, 293 (Minn. 2017). Effective administration of justice “includes protecting appellate jurisdiction, avoiding multiple lawsuits, and preventing the defeat of ‘the objects of the appeal or writ of error.’” Id. The decision-maker should “identify the relevant factors, weight each factor, and then balance them, applying . . . sound discretion.” Id.; and
(t) Based on the entirety of the administrative record, the city council finds that:
1. granting the stay pending appeal protects the Court of Appeals’ jurisdiction and the public interest by allowing meaningful judicial review, and, relatedly, the purpose of the appeal to the Court of Appeals would be defeated unless the council grants the stay, because the appeal concerns pre-development environment review, which would not be available if the development proceeds; and
2. not granting the stay pending appeal would cause harm to the Relator’s interests that cannot be remedied by money, because, in the event the Court of Appeals finds that the pre-development environmental review was inadequate, that harm cannot be remedied by money; and
3. the Court of Appeals’ resolution of legal questions on appeal could result in reversing the council’s decision on the need for an EAW, because the issue for the Court of Appeals is whether an EAW is required; and
(u) Minnesota Statute §116D.04, subd. 10, allows the decision-maker to “order a stay upon terms it deems proper”; and
(v) Minnesota Rule of Appellate Procedure 115.03, subd. 2, provides that when the Court of Appeals has certiorari review, the lower tribunal “may stay enforcement of the decision in accordance with Rule 108.” Minnesota Rule of Appellate Procedure 108 provides that a stay may be granted “if the appellant provides security in a form and amount that the [lower tribunal] approves”; and
(w) Per Minn. R. App. P. 108.02, subd. 4(c), “when the judgment or order determines the . . . use of real or personal property . . . the amount of the security normally must be fixed at such sum as will compensate the respondent for the loss of use of the property during the pendency of the appeal, costs on appeal . . ., interest during the pendency of the appeal, and any other damages (including waste) that may be caused by depriving the respondent of the right to enforcement of the judgment or order during the pendency of the appeal”; and
(x) Respondent Kinseth has presented evidence that it reasonably anticipates losses and costs associated with the delay caused by the appeal in the amount of $______.
(y) Based on the entirety of the administrative record, the city council finds that it is appropriate that Relator Rebecca Mulenburg post security in the form of a supersedeas bond in the amount of $___________, which sum will compensate the developer for the loss of use of the property during the pendency of the appeal, increased construction costs, interest incurred during the pendency of the appeal and costs of the appeal. This security must be posted on or before ________________ in order for the stay granted hereunder to take effect.
FURTHER RESOLVED, that the Relator’s motion for a stay is granted conditioned upon the Relator posting security in the form of a supersedeas bond in the amount of $1.6 million on or before July 10, 2023.
Statement of Purpose
STATEMENT OF PURPOSE: This resolution grants the Relator Rebecca Mulenburg’s motion for a stay pending appeal of the council’s May 8, 2023 decision reversing the April 11, 2023, decision of the planning commission to grant a citizen’s Petition for an Environmental Assessment Worksheet (EAW) for a proposed hotel at Sundby Road and West Page Street.
Planning Commission Decision: April 11, 2023
City Council Appeal Received: April 14, 2023
City Council Appeal Hearing and Decision: May 8, 2023
May 31, 2023: Certiorari Appeal filed with the Minnesota Court of Appeals
May 31, 2023: Motion for Stay filed with the Minnesota Court of Appeals
June 5, 2023: Motion for Stay emailed to the Duluth City Clerk
June 14, 2023: Minnesota Court of Appeals denies Relator’s Motion for Stay.