Court: Minnesota college towns can close neighborhoods to rentals

Ted Dzierzbicki bought a house in Winona when his daughter went to school there. When she graduated, the Illinois man was unable to rent his home in Winona. Photo: Alex Kolyer/File

The Minnesota Court of Appeals has given a boost to cities who that want to keep neighborhoods from being taken over by college students.

In a decision issued today, the court upheld Winona’s law that forbids more than 30 percent of any neighborhood block from being used for rental housing. Homeowners had appealed a lower court ruling that turned aside their contention that it’s not the city’s job to limit the ability of homeowners to rent out their property.

Saying the growth in rental housing had brought increased parking woes, the city passed the ordinance in 2005 to control rental housing near Winona State University. Mankato, Northfield and West. St. Paul have since passed similar laws.

But some property owners, including one man who was leaving for a tour of duty in Iraq and wanted to rent his house while he was deployed, said the value of their property would decline under the law.

“Our argument is you cannot be denied your right to rent out your perfectly safe house to perfectly safe tenants just because a neighbor of yours has decided to do the same thing,” Anthony Sanders, an attorney with the Institute for Justice who argued for the homeowners, said in December. “Otherwise the government is just picking and choosing who gets to exercise their property rights.”

But Judge Michelle Larkin ruled that police power against some individual rights for the good of general welfare is well established in Minnesota, and the limits of the power can never be accurately defined.

“We easily conclude that the public has a sufficient interest in rental housing to justify a municipality’s use of police power as a means of regulating such housing,” she wrote in today’s opinion.

“Appellants have not shown that respondent (Winona) has done anything other than apply the mathematical formula on a first-come, first-served basis,” she said in dismissing the assertion that the law is unconstitutional because it violates the equal protection clause. “Appellants’ real complaint is about the effect of an otherwise neutral ordinance on their particular circumstances, which does not give rise to an equal-protection claim.”

Here’s the full ruling.

UPDATE (4:00 p.m.):

From MPR News reporter Elizabeth Baier:

Anthony Sanders, an attorney for the Minnesota chapter of the Institute for Justice, plans to appeal the decision to the State Supreme court.

“We think this is an issue that goes to the heart of what it means to use your own property,” said Sanders, who represents the homeowners. “And it’s an issue that the Minnesota Supreme Court is going to want to address.”

Sanders said the appeals panel did not consider Minnesota’s long history of protecting property rights.

“Instead, it summarily ruled for the city on all legal issues in a way that does not protect property rights for the future, that does not take property rights seriously for Minnesotans,” he said.