Variances: A Look at the Bright Side
By: DAVID C. SELLERGREN
Winter 2001
Property owners and developers know that from time to time a project does not quite "fit" the parameters of a zoning code. A variance from the problem zoning requirement is sometimes the only means by which a project can move forward. A tough variance standard in an ordinance can appear insurmountable. Recent court decisions in Minnesota provide some comfort to property owners who need variances.
There are two types of variances: use variances and area or performance standard variances. Use variances which seek to alter permissible uses in a zoning district, are illegal in Minnesota. Only area or performance standard variances, which seek relief from a specific requirement in a zoning code such as a setback requirement, are permitted in Minnesota.
In 1989, Moorhead's Trinity Church sought a variance to setback requirements in order to construct an addition on its property. Despite vocal opposition from local residents and their attorneys, the City approved the variance request. A neighbor then filed suit to challenge the variance. The Minnesota Court of Appeals upheld the City's approval of the variance. The City of Moorhead's ordinance utilized Minnesota Statutes § 462.357 verbatim with respect to the legal standard for granting variances. Both the statute and the ordinance provide for variances in cases of "undue hardship" where: "the property in question cannot be put to a reasonable use if used under conditions allowed by the official controls, the plight of the landowner is due to circumstances unique to the property not created by the landowner, and the variance, if granted, will not alter the essential character of the locality." In interpreting this standard, the Minnesota Court of Appeals stated:
"The first requirement is that property cannot be put to a reasonable use without the variance. This provision does not mean that a property owner must show the land cannot be put to any reasonable use without the variance. In such a case the constitution would compel a variance regardless of the statute. (Citations omitted). The statute is clearly intended to allow cities the flexibility to grant variances in cases where the constitution does not compel it. Thus, we read the first part of the definition of "undue hardship" as requiring a showing that the property owner would like to use the property in a reasonable manner that is prohibited by the ordinance." Rowell v. Board of Adjustment of the City of Moorhead, 446 N.W.2d 917 (Minn. Ct. App. 1989).
This decision substantially softens the interpretation of many city planners, attorneys, and city officials of the statutory requirements for granting variances.
In 1995, the Minnesota Court of Appeals restated the softer standard. In determining whether a property "cannot be put to a reasonable use" the Court stated:
"This court has previously construed this language to mean the landowner would like to put the land to a reasonable use, but that the proposed reasonable use is prohibited under the strict provisions of the code." Sagstetter v. City of St. Paul, 529 N.W. 2d 488 (Minn. Ct. App. 1995).
Finally, in May 2000, the Minnesota Court of Appeals heard Nolan v. City of Eden Prairie, 610 N.W.2d 697 (Minn. Ct. App. 2000), in which a property owner sought numerous variances to accomplish a subdivision of its property into three residential lots. The granting of the variances was challenged by an adjacent landowner. In once again affirming the granting of the variances, the Nolan Court stated,
"In Rowell, this court squarely addressed the question and explained that the statutory undue hardship requirement 'does not mean that a property owner must show the land cannot be put to any reasonable use without the variance.' Rather, the undue hardship standard requires a showing that the property owner would like to use their property in a reasonable manner that is prohibited by ordinance."
The Nolan Court then went on to state:
"Rowell makes clear that the three statutory requirements for granting of variance under the undue hardship standard are (1) reasonableness, (2) unique circumstances, and (3) essential character of the locality."
The Minnesota Court of Appeals' unwavering dedication to the interpretation it first announced in 1989, and the Minnesota Supreme Court's unwillingness to hear and reverse that interpretation, provides much more flexibility for property owners and developers. The apparently rigid "undue hardship" standard is less onerous than many think. Rather than proving that no reasonable use at all exists for a property without the variance, under this standard a landowner must only prove that the proposed use that is disallowed under the controlling regulations is reasonable.
Try to avoid variances as a matter of strategy in land development. But if this is not possible, know that government officials may erroneously attempt to impose a tougher standard than is really required in Minnesota.