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8.b5 City Attorney Memo -Residential Density Requirements; Laurel Ridge Concept Plan (July 14 2023)ECKBERG LAMMERS MEMORANDUM To: Scandia City Council From: Eric D. Larson, City Attorney Date: July 14, 2023 Re: Residential Density Requirements; Laurel Ridge Concept Plan; and Tension Between Scandia’s 2040 Comprehensive Plan the Unified Development Code (UDC) for Village Neighborhood Zoned Districts. MORATORIUM – INTERIM ORDINANCE On Tuesday, June 20, 2023, the City’s Planner identified discrepancies between Scandia’s 2040 Comprehensive Plan and the City’s Zoning Code regarding density requirements in the Village Neighborhood, Village Historic Core, and Village Commercial district (these Unified Development Code (UDC) groups are together referred in the UDC as "Village Districts") . The potential conflict was discovered and identified by the City Planner in his review of the Laurel Ridge Concept Plan, more fully described below, and also described elsewhere in memoranda and documents supplied to the City and City Council pursuant to the Laurel Ridge development proposal. Accordingly, at the Tuesday, June 20, 2023 City Council meeting, the City Council passed a moratorium pursuant to Minnesota Statutes section 462.355 respecting any developments in a Village Districts greater than permitted by Scandia’s Unified Development Code (UDC). The moratorium was passed in order to provide City staff and the City Council time to evaluate and better understand this potential conflict and make appropriate corrective actions. Minnesota Statutes section 462.355, Subd. 4, permits the imposition of a moratorium prohibiting uses, developments, or subdivisions within a city. However, section 462.355 further provides: 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.1 When a moratorium applies to existing housing proposals, the city must first notice and hold a public hearing and ensure that those that submitted housing proposals are provided notice of the 1 Minn. Stat. § 462.355(4)(b)(2). 2 public hearing. Accordingly, for the City of Scandia to extend its moratorium to the Laurel Ridge development proposal, it must schedule and hold a public hearing. The public hearing must be held within ten days of the public hearing notice.2 Importantly, the case law is clear that a City moratorium in this instance does not trigger a taking’s claim or other liabilities, and there are no actions that the current property owners or Continuum Development Group LLC may take to circumvent the imposition of the moratorium. Laurel Ridge Concept Plan. Continuum Development Group LLC submitted to the City a Concept Plan for a subdivision to be called “Laurel Ridge” on an existing 39.47-acre parcel, currently zoned RR-G. Currently, the property has a single dwelling and one detached accessory structure on site, and access to the property is provided off 205th Street N. Except for one parcel to the west of the site, zoned V-N, the remaining surrounding lots are all zoned RR-G and used for single-lot family dwellings or agriculture. The Laurel Ridge Concept Plan shows 13 new lots on the 39.47-acre parcel. Under the existing zoning for the site (RR-G), per the Unified Development Code (UDC), 4 Dwelling Units per 40 acres are permitted (4 DU/40 AC), with a minimum lot size (new lot) of 2.0 acres. For the Village Neighborhood zoned district, the UDC similarly sets a maximum density standard at 4 dwelling units per 40 acres (4 DU/40 AC) and, if public sewer and water are available, then 1 dwelling unit per 1.5 acres, with a minimum lot size of 1.5 acres. In contrast, Scandia’s 2040 Comprehensive Plan suggests a maximum density standard for Village Neighborhood at 1 dwelling unit per 2.5 acres or, if approved through a process such as conservation design, cluster development, conditional use permit, or planned unit development, then 1 dwelling unit per 1 acre. Relying on the 2040 Comprehensive Plan’s description of a Village Neighborhood zoned district, Continuum seeks to rezone the entire parcel from Rural Residential General (RR-G) to Village Neighborhood (V-N) in order to construct 13 residential lots on the 39.47-acre parcel. Basically, to proceed forward, Continuum needs to rezone the property to meet the density requirements for its proposed Laurel Ridge development. Potential Conflict between the 2040 Comprehensive Plan and UDC Scandia City Attorney is not prepared to opine that the City of Scandia must abide by the 2040 Comprehensive Plan’s density for a V-N zoned district, generally or for the Laurel Ridge development. Because such a legal analysis would involve considerable research and time, the Scandia City Attorney has not undertaken a detailed and thorough legal analysis and study in an attempt to reconcile the 2040 Comprehensive Plan and the UDC for V-N zoned districts but agrees that, at minimum, they are in tension. As a matter of law, a city’s comprehensive plan and code should be interpreted in any reasonable manner that gives full and complete effect to them both. To the extent it is not possible, however, to give effect to both the city’s comprehensive plan and city zoning code, then the comprehensive plan provision applies. 2 Minn. Stat. § 462.355(4)(b)(3). 3 The moratorium passed by the City Council on Tuesday, June 20, 2023, was appropriate because, separate from the proposed Laurel Ridge development, the tension between the Comprehensive Plan and the UDC merits review. Revision (amendment) of one or both instruments should occur to bring them into clear conformance as to density requirements and expectations for a Village Neighborhood zoned district. As for whether that moratorium clearly should be extended to apply to the Laurel Ridge development, a multitude of issues are raised, including (1) Continuum’s right to have the property rezoned in the first instance, and (2) can the City rely on its UDC density requirements or, alternatively, can Continuum under the existing status impose on the City the density requirements as it interprets it under the 2040 Comprehensive Plan. The City’s Planner has indicated a fair interpretation of the 2040 Comprehensive Plan indicates that the Plan may control and, thus, if the property was rezoned, the density sought under the Laurel Ridge Concept Plan is permissible and may, as a matter of law, be the result (Caveat: Neither the City nor Continuum knows the final legal result). Regardless, as noted above, the City nonetheless has discretion to impose a moratorium on the proposed Laurel Ridge development to evaluate what densities are appropriate for Village Districts and by extension for this site as well. Laurel Ridge Development and Moratorium. The implications and decisions by the City Council respecting whether to impose a moratorium on Laurel Ridge do not need to be decided by the City Council at its Tuesday, July 18, 2023 meeting. But here is some context as to the future decision-making triggered by such a moratorium: Moratorium. Noteworthy, even if the City were to extend the moratorium to the Laurel Ridge development, Continuum and City staff are not precluded from continuing discussion regarding the proposed development including density. Those discussions could be instructive as to how best to reconcile the Comprehensive Plan and the UDC, not only for the Laurel Ridge development, but future developments within the City. And if the City is still in the process of amending the comprehensive plan, upon a common understanding of how best to proceed with the Laurel Ridge development, the City could then remove Laurel Ridge from the moratorium and let it proceed through the customary city review and approval processes for such a development. No Moratorium. If the City Council, however, elects not to extend the moratorium to the Laurel Ridge development proposal, then the City must decide whether (1) the City will impose the UDC on the proposed development or (2) permit the development to proceed under the Laurel Ridge Concept Plan. By natural extension, if the City decides to impose the UDC density requirements, Continuum would have to decide whether it will proceed forward with the development as proposed, seek a rezoning, and, thereafter, seek to rely on the 2040 Comprehensive Plan as a means of imposing its density redevelopment on the City as a matter of law. 4 RECOMMENDATIONS As a result, if the City Council has any major concerns respecting the density development in the Laurel Ridge Concept Plan, then the City Council’s means of addressing those concerns is to extend the moratorium to the Laurel Ridge housing proposal. As such, the City Council should entertain and pass a motion directing city staff to duly notice, and set on the City Council agenda, for Tuesday, August 15, 2023, a public hearing per section 462.355, Subd. 4, to consider the imposition of an Interim Moratorium Ordinance on any and all uses, developments, or subdivisions within the city for existing Village Districts or proposed rezoning to a Village District zoning district involving the development of real estate greater than the maximum density set forth in the City’s Unified Development Code.