MSFA Memorandum

8/13/2019 MSFA Memorandum

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APF'T F l 1RINSx :MLttURT D

Doug NIann,Linda Iann,David Tilsen,Petitioners,

VS

James Schowalter,Respondent.

Doug NIann,Linda Iann,David Tilscn,Petitioners,

V.

Iinnesota Spo s Facilities Authority,Intervenor.

IINNESOTA SPORTS FACILITIES AUTHORITY'S IE10RANDUPION JURISDICTION AND RELIEF


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TABLE OF CONTENTSINTRODUCTION. 1ARGUMENT..21. Thc Supremc Court Has Original Jurisdiction ln This NIattcr. 2

A. Thc Pctitioncrs impropcrly try to invokc this Court's originaljurisdiction in the Stadium Lcgislation. B. This Court has originaljurisdiction to dctcrmine a pctition br a writ

ofprohibition. .4H. Pctitioncrs Iay Not Obtain Thc ReliefRcqucstcd Through A Writ OfProhibition. 6

A. Avrit ofprohibition cannot issuc bccausc thc acts complaincd ofarcnotjudicial or quasi.iudiCial in nature.

B, Rcspondcnt's sale and issuancc of Stadiunl bonds is an excrcise ofpower authorizcd by la v.

C. Rcspondent's salc and issuancc of Stadiunl bonds docs not rcsult inittury for which thcrc is no othcr adcquatc rcmedy atla v. 9CONCLUSION. 0


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TABLE OF AUTHORITIES

Casess.C..PF/,13 Minn 244,1868 WL 1889(Minn.) 6,7,871i 4sCr"C587N.W.2d838(Minn.1999) '7,89E.B &R s.Es'L35N.W.2d337(Minn,1948) 6,9 'M?./,24 NoW.2d715(Minn,1946) 6,7Sep Cpp. 4.hr s.C41N.W.1020(p inn.1889).. 4StatutesMinn,Stat. 16A.695,Subd.10. 3,4Minn.Stat. 16A.9656Minn.Stat. 16A.965,Subd.2. 8,9NIinno Stat. 480.04.Minn.Stat. 484.01,Subd.1(1) 9


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INTRODUCTIONIntervenor Minnesota Sports Facilities Authority ("MSFA") responds to the

two questions in this Court's January 14,2014 Order as follows:(a) Whether this court's originaljurisdiction has been properly invokedin this case?Not as claimed by Petitioners, but originaljurisdiction exists on another

ground. Petitioners wrongly attempt to invoke the Stadium Legislation (defined inthe MSFA's opening brief) to support jurisdiction. That statute would conferoriginal jurisdiction on a validation proceeding initiated by Respondent,Commissioner Schowalter. But since Respondent did not initiate a validationproceeding (and was under no obligation to do so), Petitioners' asserted basis ofjurisdiction does not exist. However, this Court does have original jurisdictionover proceedings seeking writs of prohibition. Therefore, this Court does havejurisdiction to assess the merits of the Petition and the proposed relief requested.

(b) Whether petitioner"s can obtain the relief requested through a petitionfo, o w'rit ofprohibition?No. A writ of prohibition cannot provide the relief that Petitioners seek

here. A writ of prohibition exists only to prohibit lower courts and other officialsfrom acting in a judicial or quasi-judicial capacity. Petitioners ask this Court toorder Respondent not to issue or sell stadium appropriation bonds. Issuing andselling bonds is not a judicial or quasi-judicial act, so the writ of prohibition is not


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available to enjoin or restrain such activity.Therefore, Petitioners are wrong about this Court's jurisdiction (although

jurisdiction exists on other grounds); they are wrong about the relief requested;and, as previously stated by the MSFA and Respondent, they are wrong on themerits. Petitioners threaten to disrupt the delicate tirning of the bond issue andrelated transactions, creating delay and added costs, through r-neritless argumentsthat cause harm not because they are valid, but merely because they have beenasserted. The Petition is Petitioner Doug Mann's third bite at the apple; his similarclaims against the City of Minneapolis were dismissed in Novernber,2013, and hedid not timely appeal that ruling. He instead waited until January 9,2014 and filedanother mandamus proceeding, this time in the Court of Appeals. Because themere existence of such matters on a court's docket could stall the bond sale, delayconstruction of the Stadium, dramatioally increase costs for the people ofMinnesota and threaten the very existence of highly beneficial related economicdevelopment, this Court should dispose of the claims raised once and for all.

ARGUIENTI. The Supreme Court Has Original Jurisdiction In This Matter.

A. The Petitioners improperly try to invoke this Court's originaliurisdiction in the Stadium Lesislation.Petitioners allege that the Stadium Legislation provides this Court with

"original jurisdiction to determine the validation of appropriation bonds and all


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plan to exercise the discretionary authority to file a validation complaint.").) Thus,this Court's originaljurisdiction has not been invoked.

Petitioners cannot invoke this Court's originaljurisdiction; only a complaintby Respondent does so. The Stadium Legislation unambiguously states that afterthe Commissioner files a cornplaint, this Court "shall issue an order" allowingcitizens and taxpayers "to appear before fthis Court.]" Minn. Stat. d 164.695,Subd. 10(g). Only after this Court issues such an order may "[a]ny taxpayer,citizen, or person interested . . . becom e a party to the action by moving against orpleading to the complaint . ." 1d, Subd. 10(i). Respondent has not fulfllled thecondition precedent: he has not filed a complaint with this Court; and this Courthas not issued an order allowing taxpayers and citizens to join the action. Forthose reasons, this Court lacks jurisdiction under the Stadium Legislation.

B. This Court has original iurisdiction to determine a petition for awrit of prohibition.Although this Court lacks original jurisdiction under the Stadium

Legislation, it has originaljurisdiction over writs of prohibition. Article VI,Section 2 of the Minnesota Constitution gives this Court "originaljurisdiction insuch remedial cases as are prescribed by law." Remedial cases are "those specialor extraordinary proceedings under what are usually called original rernedial writs,such as... prohibition." State ex rel. Clappv. Minn. Thresher Mfg. Co.,41 N.W.1020, 1021-22 (Minn. 1889).


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Minn. Stat. $ 480.04 specificalll,addresses wrils of prohibition:The [Minnesota Supreme Court] shall have power to issue to allcourts of inferior jurisdiction and to all corporations and individuals,writs of . . . prohibition . . . and all other writs and processes, whetherespecially provided for by statute or not, that are necessar),to theexecution of the laws and the furlherance ofjustice. It shall be alwaysopen for the issuance and return of such writs and processes and forthe hearing and determination of all matters involved therein and forthe entry in its minutes of such orders as may from tirne to time benecessary to carry out the power and authority confbrred upon it bylaw, subject to such rules as it may prescribe. . . .

Thus, this Court has original jurisdiction over lvrits of prohibitiorr, including"the hearing and determination of all matters involved therein."

The jurisdiction over writs has a defined purpose. Minn. Stat. $ 480.04authorizes this Courtto issue writs "that are necessaryt 7s the exectrtion of the lawsand thefurtherance of.iustice." Here, those statutory pulposes would be thwartedby issuing the writ and are threatened even by the continued existence of thisproceeding. To allow for the execution of the Stadium Legislation, this Courtshould dismiss the Petition on the merits or, at a rninimum, require a substantialsurety bond to protect the public interest.

Nor would justice be furthered by a writ of prohibition. Mr. Mann appearsto be a serial litigant, determined to keep asserting meritless claims until this Court,the final arbiter of Minnesota law, definitively disposes of those claims. AllowingPetitioners to continue to disrupt, delay and threaten the Stadium Project and theDowntown East Development Project by endless litigation does not further justice.


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Petitioners Mav Not Obtain The Relief Requested Throush A Writ OfProhibition.Petitioners request a writ of prohibition "restraining respondent Jim

Schowalter, Commissioner of Minnesota Management and Budget, fromproceeding with the sale and issuance of certain stadium appropriation bondspursuant to Minn. Stat. $ 164.965 (2012)." (Order at 1.) That remedy is sirnplyunavailable to them, here or in any other court. Under Minnesota law,

[t]hree things are essential to justify the issuance of the writ [ofprohibition]. It must appear (1) that the coutI, officer, or personagainst whom it issues is about to exercise.judicial or quasi-judicialpower; 12) that the exercise of such power by such cour:t, officer, orperson is unauthorrzed by law; and (3) that it will result in injurl' forwhich there is no other adequate remedy at law.

Itlemo v. Local Joint Exec. Bd. & Hotel & Rest. Entploltees ' Loca ,3 5 N.W.2 d 337 ,340 (Minn. 1948). Because Petitioners fail to meet any of these requirements, awrit of prohibition cannot issue.

A. A writ of prohibition cannot issue because the acts complained ofare not iudicial or quasi-iudicial in nature."[]t is clear that [a rvrit of prohibition] is only issued to restrain the exercise

ofjudicial powers." Ilome Ins. Co. of St. Paul v. Flint,l3 Minn. 244, 1868 WL1 889, at *2 (Minn.). "In order to justify a writ of prohibition, it is fundamentallyessential that the court, individual, or officer Be [sic] about to exercise judicial orquasi-judicial power." O'Neill v. Kollsen, 24 N.W.2d715,716 (Minn. 1946). Awrit of prohibition "will not issue to restrain individuals or nonjudicial bodies frorn


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exercising purely political, legislative or administrative functions." Id.ln Hotne Insurance Companlt petitioner sought a writ of prohibition to

restrain a county attomey from making a financial examination and certificationrequired by statute. I 3 Minn . 244, 1868 WL 1 889 at * l-2. The Court noted that"used in the ordinary and legal acceptation," there was nothing'Judicial" in thisact. Id. at*2. The Courl then turned to the dictionary definition of 'Judicial" toconfirm this view. 1d Merriam Webster Online defines 'Judicial" as:

"of or relating to coutts of law or judges""ordered or done by a court""responsible for dealing with all legal cases involving thegovernment"

http://wwrv.merriarn-webster.com/dictionarlz/judicial?show:0&t:1389820632The same analysis is appropriate here. In any sense of the word, the sale andissuance of stadium bonds is not'Judicial" in nature. The definition of 'Judicial"confirms that assessment, as the act is not "relatfed] to courts of law or judges," or"ordered or done by a court," and it has nothing to do with responsibility for legalcases involving the government. Id.

Likewise, the sale and issuance of stadium bonds is not quasi-judicial innature. In Minnesota C.'enterfor Environmental Advocacy v. Metropolitan Cottncil,587 N.W.2d 838 (Minn. 1999), this Court set forth a frameu'ork for determining ifan action to be restrained is quasi-judicial, giving three indicia of quasi-judicial


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actions: "(l) investigation into a disputed claim and weighing of evidentiary facts:(2) application of those f-acts to a prescribed standard; and (3) a binding decision

regarding the disputed claim." Id. at 842. Here, the sale and issuance of thestadium bonds does not involve R.espcndent Schowalter investigating any disputedclaim or weighing any evidence, applying facts to any prescribed standard, ormaking a binding decision of any kind. Respondent is exercising an administrativefunction expressly pror.'ided by Minnesota statute:

Sub.f ect to the limitations of this subdivision, the commissioner maysell and issue appropriation bonds of the state under this section forpublic purposes as provided by law, including. in particular, thefinancing of all or a porlion of the acquisition, construction,improving, and equipping of the stadium project of the MinnesotaSports Facilities Authority as provided by chapter 473J.

Minn. Stat. $ 16,{.965, Subd. 2(a). That the statute may cont-er discretion onRespondent does not convert the act at issue from administrative to judicial orquasi-judicial: "[m]inisterial officers are not unfrequently required to perform actswhich involve to some extent the exercise of legal discretion, but which are notregarded as judicial." Honte Ins. Co., l3 Minn .244, 1868 WL I 889 at *2.

Respondent is not "about to" exerciSe onlz judicial or quasi-judicial power, afundamental element for a writ of prohibition. The remedy does not apply here.

B. Besrrondent's sale and issuance of Stadium bonds is an exercise ofrlower authorized by law.Petitioners also fail to meet the second requirement for a writ of prohibition.


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They cannot show that the exercise of the judicial or quasi-judicial power at issueis unauthorized by law. See Nemo, 35 N.W.2d a1340. Respondent's sale andissuance of the Stadium bonds is expressly authorizedby Minnesota statute. SeeMinn. Stat. $ 164.965, Subd. 2(a); see a/so Subd . 2(c) ("Appropriation bonds maybe issued from time to time in one or more series on the terms and conditions thecommissioner determines to be in the best interests of the state"). Respondent isfully authorized to issue and sell Stadium bonds, and a writ of prohibition istheretbre not available.2

C. Respondent's sale and issgance of Stadium bonds does not resultin iniurv for which there is no other adequate remedv at law.As discussed in Respondent's opening Brief, the thrust of Petitioners' theory

is that the treatment of lvlinneapolis tax revenues under the Stadium Act of 2012

(passed in May 2012), is unconstitutional. Under Minnesota law, the districtcourts, not the Supreme Court, have originaljurisdiction over such matters. Minn.Stat. $ 484.01, Subd. 1(l ). Petitioners could have, but chose not to, bring a timelyaction in Minnesota district court challenging the constitutionality of the StadiumAct. Petitioners fbrmerly had an adequate remedy at law, which they failed topursue. for over 18 months. As explained in Respondent's opening Brief at2 To the extent that Petitioners may argue that Respondent is not legallyauthorized to issue bonds because of Petitioners' clairn that the law isunconstitutional, that is a separate claim which is not appropriate in a writ ofprohibition proceeding, as shown in Section II.C., infi"a.

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Section I, Petitioners have no valid excuse fbr this faiiure, and such a suit wouldcause serious prejudice at this late hour. Any such suit is thus barred by laches.

CONCLUSIONThe MSFA respectfully renews its request for either a merits-based

dismissal of the Petition or, at a minimum, requirement of a substantial surety bondto protect the interests of the MSFA, the Respondent, and the people of Minnesota.Dated: January 16,2014 EY LLP

Kristina L. Carlson (#319338)Erin P. Davenport (#0388845)Hugh D. Brown (#0390969)Suite 1500, 50 South Sixth StreetMinneapolis, MN 55402-1 498(612) 340-2600Attornel's .for Minnesota Sports Faci litiesAuthori$t

ACKNOWLEDGMENTThe undersigned hereby acknowledges that sanctions may be imposed underMinn. Stat. $ 549.211.

DORSEY& HITNEY LLP

10

David Y. Trevor


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STATE OF MINNESOTACO TY OF HE lNEPIN

27-CV 1313029 Flled ln Foulth udicial Distnct Coul1/12/2013 7 23 45 PHennepin county C,vl,

DISTRICT COURTFOURTH JUDIChL DISTRICT

Doug Nlann,

Minneapolis City Council,Petitioner,

Respondent.

The above-captioned matter came before the undersigned Judge of District Courton August 20, 2013 for a hearing on the Petition for Writ of Mandamus filed byPetrtioner Doug Mann. With the Court's permission, Petitioner filed a supplemerrtalbrief on August 26, 2013, whereupon the record was closed and the matter rvassubmibted.

Petitioner was self-represented.Respondent lvas represented by Peter W. Ginder, Esq.Based upon a1l the files, records, and proceedings herein, the Court makes the

following:ORDER

1. The Pctition for a Writ of iVlandamus is DENIED.2. The Petition for a Writ of Mandamus is dismissed.

LET JUDGMENT BE ENTERED ACCORDINGLY.

Court Flie No 27 CV 13-13029The HonOrable Philip D.Bush

ORDER DISMISSING PETIT10NFOR RIT OF PIANDAIVIUS


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3. 'Ihe attached Memorandum is made a part hereof.

Dated:11/12/13

BY THE COURT:

Phllip D.Bushudge ofI)istrict Court


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MEMORANDU-MThis matter is belbre the Court for a hearing on the Petition for a Writ of

Mandamus filed by Petitioner. For the reasons set forth below, the Petition for a Writ ofMandamus is denied and dismissed.

I. BackgrgundPetitioner has petitioned the Court for a writ of mandamus compelling

Respondent Minneapo)-is City Council "to place on the ballot in the next general electionon November 5, 2013 the question of whether the City of Minneapolis shall acceptobligations imposed upon rt by the Vikings Stadium Act of 2012."

a. Citv CharterIn 1997, voters in the City of MinneapoLis ("City") amended the City Charter to

include the following provision requiring a referendum if more than 910 million doilarsin city resources is to be used to finance a professional sports facility:

The City of Minneapolis, Minneapolis Community Development Agency,ol any city department, agency, commission, or board, shall use no cityresources over $10 million dollars for the financing of professional sportsfacilities without the approval of a simple majority of the votes cast on thequestion, in a ballot question put to the public at the next regularlyscheduled election. City resources are defined for these purposes os: Taxincrement financing, bonds, loans, land purchase or procurement, land orsite preparati"on, including necessary infrastructure such as roads,parking development, sewer and water, or other infrastructuredeveiopment, general fund expenditures, sales tax or other taxes, deferredpayments, interest free or below market interest rate loans, the donationor below market value sa.le of any city resources or holdings or any otherfree or belorv cost city services. The ballot question shall not be put beforethe public in a special eJ.ection, in order to prevent the costs associatedwilh special elections.

Mrnneapolis, Minn., City Charter, ch. 15, $ 13 (emphasis added).Since 1973, the City Charter has included a provision requiring a referendum if

the City is to incul more than.$15 milLion in debt or other obligations for any capital1


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improvement. See Minneapol-is, Minn., City Charter, ch. 15, $ 9. That provision statesin pertinent part:

ffihere, with respect to any and all types and forms of obligdtion orindebtedness authorized by this Charter and by the laws of the State ofMinnesota, the aggregate amount of any such obligations or indebtednessto be issued or incurred for any improvement, including but not limited toacquisition, dcvelopmcnt, construction or bettcrment, of any publicbuilding, stadium, or other capital improvement project, shall in a1lphases from inccption Lo completion exceed Fifteen Million Dollars($15,000,000.00), the Board of Estimate and'I'axation shall not issue orseli any bonds or other obligations nor incur any indebtedness for suchpulpose without the approval of a majority of the electors voting on theqnestion ofissuing such obligations or incurring such indebtedness at agenelal or special election.

Id.b. Stadiun Legislation

In 2012, the lVlinnesota legislature enacted legislation ("Stadium Legrslation")providing for a new National Football League stadium ("Stadi.um") in Mirnesota. See2012 Minn. Laws, ch. 299. The Stad-ium is to be built in the City at the site of theIlubert H. IJumphrey Metrodotne. See id., art. 1, SS 10, 14.

llnder the Starlium Legislation, the cost of building the Stadium is split betweenthree entities. The owner of the Minnesota Vikingsl must contribute at least $477million to burlfing costs. See id., art.1, S 19. The State of Minnesota's sha.e is "limitedto" $348 million of ihe building costs. See id., art. 1, S 15. The City's share is "limited to"$150 million of the building costs. See ld. In additron to its share of the buildingcosts,the City is r-rltima[ely responsible for (1) a share of the Stadrum's operating expenses

I The Minnesota Vikings are the National Football League team that will be playing in the Stadium.See2012 Nlinn. Laws, ch.299, art. 1, $ 10.


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with the City's share sct to begin at $6 million per yearz and (2) an annual contributionto the Stadium's capitzrl improvemenb fund with the City's contribution set to begin at$1.5 mjllion per year.3 See id., art. 1, $ 18, art. 3, S 1.

The City's share of the buiiding costs and operating expenses and itscontributions to the capital improvement fund are to be funded by various sales taxesthat must be imposed by the Cify, including a sales tax of up to half a percent ontaxable sales within the City, a sales tax of up to three percent on certain sales ofintoxicaLj.ng beverages, a sales tax of up to three percent on certain short-term lodging,and a sales tax of up to three percent on certain food sales. See id., arL.3, S$ 1-3.

The revenue generated by those sales taxes is collected by the Commissioner ofRevenue, who retains enough revenue to satisfu the City's obligations for building costs,operating expenses, and capital improvements and makes various other deductions(e.g., collectioncosts). Seeid., art.3, SS 1-2;seealso Minn. Siat. S 297A.67, subcl. 11(defining "commissioner"). The balance of the revenue is remitted to the City, which"may use the excess revenue . . . to fund capital projects to further residential, cultural,commerclal, and economic development in both downtown Milneapolis and theMinneapolis neighborhoods, to fund other city expenditures in support of the basketballarena, other capital projects, or for other economic development, provided the city maydrrect excess revenue first to convention center debt, operations, capital improvements,and marketrlg." Id., art. 3, $ 2.

2 Ovel the 30-year term of the lease required by the Stadium I.egislatron, see id., art, 1, $ 19, theCity's share of the Stadium's operal.ing exlrenses will total no less than $180 million.3 Over the 3O-year term of the lease required by the Stadium Legislation, the City will havecontributed no less than $45 million to the capital improvement fund.


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The Stad-ium Legislatron contained the following provision entitled "CharterLirnrtations, Requirements Not To Apply":

Any amounts expended, indebtedness, or obLigation incurred including,but not hmited to, the issuance of bonds, or actions taken by the cityunder this act, are deemed not an expenditure or other use of cityresources within the meaning of any law or charter provision. The citymay exercise any of its powers under this act to spend, borrow, tax, orincur any form of indebtedness or other obligation for the improvement,including, but not limited to, acquisition, development, construction, orbetterment of any pubhc building, stadium, or other capital improvementproject, without regard to any charber limitation, requirernent, orprovision, including any referendum requirement. Any tax exemptionestab[shed under this act shall be deemed not an expenditure or otheruse of city resources within the meaning of any charter provision.

Id., art.3, S 4.z\rticie 3 of the Stadium Legislation contained the following provision regarding

local approval:This article is effectrve the day after the governing body of the city ofMinneapolis and rts chief clerical officer comply with Minnesota Statutes,section 645,027, subdivisions 2 and 3. Notwithstanding any law to thecontrary, the city of Minneapolis and its chief clerical officer have 30calendar days follorving final- enactment of this act, bo comply withMinnesota Statutes, section 645.021, subdivisions 2 and 3'

Icl-, art.3, $ ?. IJnder the designated statute, local approval is accomplished "byresolution adopted by a majority vote of all members of the governing body of the unitunless another method of approval is specified by the parti.cular special law." Minn.Stat. S 645.021, subd. 2.

on May 25, 201,2, the city council, by a vote of.7-6, and the iVlayor approved theStadrunr Legislation. (Ginder Aff. Ex. A.) On June 4, 2012, the City Clerk filed aCertificate of Approval wj-th the Secretarv of State in compliance with Minn. Stat. $645.021, subd. 3. (GrnderAff. Ex. A.)


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U. Analysis"Mandamus is an extraordinary remedy that is available only to compel a duty

clearly required by law." Northerru States Power Co. u. Minnesota Metro. Council, 684I{.W.2d 485, 491 (Minn. 2004) (internal citation omitted). To obtain a writ ofmandamus, the petitioner must show that (1) the respondent "failed to perform anofficial duty clearly imposed by lalv"; (2) as a result, the petitioner "suffered a publicwrong specifrcaJly rnjurious to the petitioner"; and (3) "there is no other adequate legalremedy."

a. Did Respondent Fail to Perform an Official Duty Clearlvknposed by Law?Petitioner maintains that Respondent failed to perform an officiai duty clearly

imposed by 1aw by not holding a referendum on the Stadium Legislation as allegedlyrequired by both Sections 9 and 13 of Chapter 15 of the City Charter.

i. Section 13W-hether Chapler 15, Section 13 of the City Charter ("Section 13") required

Respondent to hold a referendum on the Stadium Legislation raises two underlyingissues. First, does the Stadium Legislation entail the use of more than $10 million in"city resources" for the financing of a professional sports facility, such that Section 13 isapplicable? Second, if Section 13 is appli.cable, was it preempted by the StadiumLegrslation?

On the first issue, Respondent argues that Section 13 does not apply because theStadrum I-egislation does not entai-l the use of "city resources." In making thisargument, Respondent notes that the dictionary definition of "resource" sometimesdenotes "availability." With that definition in mind, Respondent maintains that the


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sales tax revenue funding the Stadium does not constitute a "city resource" because therevenue is never "available" to the City insofar as the Stadium Legislation requires thatportion of the sales tax revenue funding the Stadrum to be deposited into the state'sgeneral fund.

That argument is unavailing in several respects. Most notably, the Court cannotdiscern any need for turning to a dictionary definition of "resource" when the CityCharter itself defines "city resources" for purposes of Section 13. Specifically, forpurposes of Section 13, the City Charter defines "city resources" to include "sales tax orother taxes." Minneapolis, Minn., City Charter, ch. 15, $ 13 (emphasis added).

Since Section 13 defines "city resources" to include "sales tax or other taxes," thevoters who adopted Section 13 in 1997 must have intended the definition of "cityresources" to include revenue generated. by a sales tax that applies solely within theCity. The voters'intent is not undone simply because the statutory mechanism forcoJJecting and directing the sales ta-x revenue funding the Stadium precludes the Cityfrom using that revenue for any other purpose.a

Respondent's argument is hkewise unavailing given a curious dichotomy.According to Respondent, the sales tax revenue used to fund the Stadium is not a "cityresource" because, given the dictates of the Stadium Legislation, those funds are neveravai-lable to the City. Under the Stadium Legislation, any excess sales tax revenue isremitted to the City, which may use the excess revenue for various purposes. See 2012

a Similarly, with respect to the provision of the Stadium Legislation stating that any amountsexpended by the City are "not an expenditure or other use ofcity resources within the meaning ofany law or charter provision," 2012 Minn. Laws, ch. 299, afi.3, $ 4, the intent of the Minneapolisvoters and what is meant by "crty resources" is not to be decided by the legislature. The legrslaturemay have authority to preempt the City Charter, but they do not have authority to interpret it.Interpretation of the iaw is the domain of the judiciary.


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Mina. Laws, cb.299, art. 3, $S 1-2. The excess sales tax revenue is thus "avail.able" tothe City and meets the definition of "city resource" posited by Respondent. Accordingly,Respondent's positi.on necessarily imp[es a curious d"ichotomy whereby some porti.ons ofthe sales tax revenue are a "city resourc6" andotherportions ofit are not.

That dichotomy undermines Respondent's argument in the following way:(1) were it not for the City's obJigation to fund the Stadium, all of the sales tax revenuewould constitute a "city resource"; (2) accordingly, by approving of the StadiumLegislation, the City surrendered weii in excess of $10 million in "ci.ty resources" forpurposes of funding the Stadrum; and (3) by suruendering "city resources" for thatpurpose, the City "used" it for that purpose. Any resource, once expended, is no longeravailable to the person who expended it. The expenditure of it and its subsequentunavailability does not mean that it was never a "resource" for the person whoexpended it.

On that point, Respondent might argue that the sales tax revenue would notexist in absence of the Stadium Legislation. However, the sales tax revenue would existin absence ofthe Stadium Legislation because the sales.taxes were already authorizedby 1986 Nlinn, Laws, ch. 396, SS 4-5. Moreover, that 1aw was amended in 2009 to allowtheCitytousesomeofthesa-lestaxrevenueformoreexpansivepurposes. See2009Minn. Larvs, ch. 88, a,-t.4, $ 12. Accordingly, in absence of the Stadium Legislation, theCity would stiil have enjoyed the sales tax revenue as a resource.

The Stadium Legislation, construed as a whole, further underminesRespondent's argument that the sales tax revenue is not a "city resource" by virtue ofthe statutory mechanism for collecting the revenue and directing a pogion of it toward


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the Stadiurn. The Stadium Legislation undermines that argument because it rests onthe premise that the City is responsible for a share of the funding. Specifica11y, theStadium Le gislation provides:

The state share of stadium costs shall be iimited to $348,000,000 forconstruction of a new stadium, as pelmitted under section I 6A.726. Thecity of IVlinneapolis share shall be limited to no more than a $150,000,000contnbution for construction, and the annual operating cost and capitalcontributions contained under section 47 3J.13.2012 Minn. Laws, ch. 299, art 1, $ 15. If the City has a "share" of the funding, then "cityresources" must be in play. Similarly, the Stadium Legislation refers to the sales tax asa tax "imposed" by the City. See, e.g., id., art.3, $ 1. Revenue generated by a tax"imposed" by the City nalurally constitutes a "ciby resource."

Lastly, constitutional limitations on local taxes undermine Respondent'sargument that the sales tax revenue is not a "city resource." Under Section 1, Article 9of the Minnesota Constitution, "a tax cannot be imposed exclusively on any subdivisionof the State, to pay an indebtedness or claim which is not pecuJiarly the debt of suchsubdiyision, or to raise money for any purpose not peculiarly for the benefit of suchsrrbdivision ." Saruborn u. Rice Cnty. Commis, 9 Minn. 273, 278 (1864). This Hmitationfurther e,stablishes that revenue generated by a city-specific sales tax is a city resource,not a resource of the state, insofar as the benefi.ts of that revenue must inure to the city.

For the reasons set forth above, the Court concludes that, within the meaning ofSection 13 of the City Charter, the Stadium Legislation entails the use of more than910 million in "city resources" for the financing of a professional sports facility. Section13 is thus applicable. The Court thus turns to the issue of whether Section 13 waspreempted by the Stadium Legrslation


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Under the Minnesota Constitution, municipalities "possess no inherent powersand are purely creatures of the legislature." See Breza u. City of Minnetrista, 725N.W.2d 106, 110 (Minn. 2006) (citing Minn. Const. art. XII, $ 3). Nevertheless, a citygoverned by a home rule charter, such as the City of Minneapolis, "enjoys as to localmatters all the powers of the state, except when those powers have been expressly orimpliedly withheld." Nordm.arken u. City of Richfield, 641 N.W.2d 343, 347 (Minn. Ct.App. 2002). Given the State's authority to withhold powers from a home rule chartercity, the legislature may preempt "charter authority on matters of state concern." Id. at348 (citing State er, rel. Town, of Lowell u. City of Crookston, 252 Minn. 526, 91 N.W.2d81, 83-84 (1e58)).

Here, in enacting the Stadium Legislation, the legislature preempted thereferendum requirement in Section 13 of the City Charter via the following provision:

The city rnay exercise any of its powers under this act to spend, borrow,tax, or incnr any form ofindebtedness or other obligation for theimprovement, including, but not limited to, acquisition, development,construction, or betterment of any public building, stadium, or othercapital improvement project, without regard to any charter limitation,requirement, or provision, including any referendu.m requirement.

2012 Minn. Laws, ch. 299, art. 3, $ 4 (emphasis added).On the issue of preemption, Petitioner raises two arguments in support of his

position that Section 13 still requires a referend.um. First, Petitioner argues that theStadium Legislation does not evjnce any intent to repeal Section 13 of the City Charter.Petitioner is correct in noting that the legislature has not expressed any intent torepeal Section 13. However, repeal is not the issue. The issue is whether the legislatureintcnded to preentpt, the requirements of Section 13 with respect to the StadiumLegislation. The legislature clearly.expressed such intent.


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Second, Petitioner argues that Section 13 was not properly preempted based onArticle 12, Section 2 of the Minnesota Constitution, which provides i.n pertinent part:"The legislature may enact special laws relating to local government units, but a speciailarv, unless otherwise provided by general law, shall become effective only aftei itsapproval by the affected unit expressed through the voters or the governing body andbysuchmajoritvasthe1egrslaturemaydirect.,,.Id.(emphasisadded)

Petitioner's argument that Section 13 was not properly preempted rests on thepremise that Article 12, Section 2 of the Minnesota Constitution, by use of thecJrsjunctive "or," requi-red the legislature to allow the City to approve the StadiumLegrslation through either the voters or the governing body. Petitioner has not citedany case 1aw in support of his reading of Article 12, Section 2. Case law aside, the Courtd.oes not interpret Article 12, Section 2 as requiring that the affected government unitbe allowed the choice of approving a special law through either the voters or thegoverning body. Rather, the Court interprets the disjunctive "or" in Article 12, Section 2as merely establishing that a special 1aw takes effect upon either form of approval.Here, the Stadium Legrslation was approved. by the governing body.

For the reasons set forth above, the Court concludes that Section 13, thoughapplicable, was preempted by the Stadium Legisiation

ii. Section 9The referendum requirement in Chapter 15, Section g ("Secti.on 9") of the City

Charter, even if appLicable, is likewise preempted by the Stadium Legislation and itsprovision stating that "[t]he .lty -uy exercise any of its powers under this act to spend,borrolv,tax,orincuranyformofiadebtednessorotherobligation1brtheimprovement'

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. . . without regard to any charter limitation, requirement, or provision, including anyreferendum requirement-" 201.2 Minn. Laws, ch. 299, art. 3, $ 4.

iii. PreernptionSince the Stadium Legrslation preempted the referendum requirement in both

Sections 9 and 13 of the Stadium Legislation, Respondent did not fail to perform anofficial duty clearly imposed by Iaw by not holdrng a referendum on the StadiumLegislation. Accordrngly, Petitioner has not satisfied the first requirement for obiaininga writ of mandamus.

b. Did_th: Betitioqq.r Suffer a Public Wrong Specificallv Iniuriousto Him?This requirement is essentially a question of standing. Respondent argues that

Petitioner lacks standing because he has not demonsLrated that the lack of arefcrcndr.rm on thc Stadrum Legisiation was more injurious to him than any other Cityresident.

In Scinocca u. St. Louis Cnty. Bd. of Com,m'rs, 281 N.W.2d 659, 660 GVIinn. 1979),the court held that the plaintiff had standing to institute a mandamus proccedingagainst St. Louis County to enforce the Town of Canosia's zoning ordinances because"fp]laintrff, as a resident and taxpa5,er, ha[d] an interest in cnsurJ.ng that town zoningordinances are enforced."5

Given the standard set forth rn Scinocca, Petitioncr has standing to seek a writof mandamus because, as a resident of the City, he has an interest ur ensuring thatCharter requirements giving City residents the right to vote on a particular issue arehonoled and enforced. In other words, Petrtroner is "beneflcially interested" in enforcing5 In Scinocca, the court held that plaintiff had standing under both Minn. Stat. $ 394.3?, subd. 4. andIvlnn. St. 586.02. Only the latter statute rs applicable in this case,

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any right to vote that he may enjoy. See Minn. Stat. S 586,02. The second requirement forobtaining a writ of mandamus is thus satisfied. 6

c. Does Petitioner Have Any Other Ad=equate Legal Remedv?Plaintiff rvaited over a year from the passage of the Stadium Legislation and the

bringing of this mandamus suit. Although many of his arguments challenge theconstitutional authori.ty of the Legislature to do what it did Plaintiff denies he ischallerrging the consLitrrLionality of the Stadium Legislation. One possible alternativeremedy would have been to f,le a lawsuit in Ramsey County chal.lenging theconstitutionally of the Stadium Legislatron. Plaintlff has chosen not to pursue thatoption. The third requirement for obtaining a writ of mandamus is thus not satisfied.

III. ConclusionOnJ.y the second requireurent for obtaining a writ of mandamus is satisfied.

However', since the referendum requirement in Sections 9 and t3 of the City Charter ispreempted by the Stadir.rm Legislation, Respondent has not failed to perform a dutyclearly irnposed by law by not holding a referendum on the Stadium Legislation.Accordingly, Petihoner has not satisfred the fi.rst requircmcnt for obtaining a writ ofmandamus. Additionaliy Petitioner has an adequate remedy at iaw that he drd not use.The Petition for a Writ of Mandamus is thus denied and dismrssed.

PDB

6If standrng requires somc tJrpc of harm more injurious to Petitioner than other members of thepubhc, Petitioner stili has standing as a resident of the City because the Stadrum Legislatron, ineffectively precluding a referendum, was particularly injuries to residents of the City insofar as theyarc the peoplc whose right to vote is at issuc.12


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Memorandum and Order in Mann

27 -CV -13 - 13029 (Hennepin Cnty.Ct. App. Jan. 9, 2014); andCity Council, Court File No.12, 20 13), app eale d (Minn.v. MinneapolisDist. Ct. Nov.

3. Affidavit of Service.

Subscribed and sworn to before methis ltfl da1'of January, 2014.

Iaikkula

/jrd,tc/ltNotarv

4842-6923-0360


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D RSEYER:NP.DAVENPORTAssociate

(612)492 [email protected]. ,lFanuary 16,2014V A MESSENGER AND EMA:LClerk of Appellate Courts305 Minnesota Judlcial Center25 Rev Dr Martin Luther King r BlvdSt Paul,MN 55155

Re. Doug Mann, et al. v. James SchowalterCourt File No. A14-0029Dear Clerk of Appellate Courts:

Enclosed for filing in the above-referenced matter are the following documents.1. The original and 3 copies of the Minnesota Sports Facilities Authority's Memorandumof Law on Jurisdiction and Relief;2. Four copies of the Memorandum and Order in Mann v. Minneapolis City Council,Court File No. 27-CV-13-13029 (Hennepin Cnty. Dist. Ct. Nov. 12,2013), appealed(Minn Ct App Jan. 9, 2014); and3. Affidavit of Service.By a copy of this letter and enclosures, all parties are being served.Please feel free to contact me if you have any questions.

, Sincerely, '/ /) '.^ [ -" '--. : , ^ f ,,LL/i LL| *1' ,r kErin P. Davenport r''AssociateEnclosurescc: Thomas Klosowski, Kutak Rock LLP, (w/encl. via email and U.S mail)Doug Mann (w/encl. via email and U.S. mail)Linda Mann (w/encl. via email and U.S. mail)David M. Tilsen (w/encl. via email and U.S. mail)

Documents

MSFA Memorandum