Court: Minnesota college towns can close neighborhoods to rentals

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.

  • David

    So instead those towns will have parents purchasing their second (or third) homes for their college kids and their friends to live in while they are in school. This happens near the U in Mpls already and it happened at my school in central New York ten years ago.

    • Wouldn’t that be “renting” the property to their kids’ friends? And do they sell the house when the child graduates?

      • David

        It all depends on what you call it with your kid’s friends and if you want them to pay rent, etc.
        Yes – they sell the house when the kid graduates to another family who has a kid 4 years younger. Rinse, repeat.

    • joetron2030

      What happened to just living on campus? Is the expense of “room & board” so onerous that it’s really less expensive in time and money to buy a second house and maintain it?

      • David

        I’m not saying its “right” just what is happening. Even the guy in the photo bought the house for his daughter to live in while she was at school.
        Personally, I lived on campus all 4 years.

        • joetron2030

          Sorry, David, my comment wasn’t aimed at you specifically. Just more of a general question due to bewilderment on my part.

          I lived on campus all four years in college too.

  • “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.”

    Seems weird to me, but then again, so is Winona.

  • BReynolds33

    What’s the penalty for renting it out anyway? Work it into the cost of rent and move on.

    • Not that easy. The city issues an order to vacate, and then you get to go to court on a criminal complaint.

      • BReynolds33

        Darn. Was hoping it was like the penalties oil companies face. Ha ha.

  • Kassie

    So instead they’d rather have a vacant home in foreclosure? One where the yard isn’t maintained, the sidewalk isn’t plowed and is at risk of squatters? I know we are talking Winona and that isn’t likely, but if this guy can’t rent the place, and can’t sell it for what he owes, what is his choice? I have a number of friends who have turned to renting their places when they couldn’t sell.

  • I asked an friend who is a Winona-native about this. Here’s his response:

    “Not an easy call. Lots of complaints from locals on party noise and other mischief from college kids (surprised the main beef in this article is parking…). Do you blend the college houses in with family blocks and create inevitable tension, or do you section off space for college ghettos like Dinkytown, where they become slum-like?”

    • // surprised the main beef in this article is parking…).

      If you build a law around an age group and noise — citing it specifically — than you ARE going to have an equal protection issue.

      • David

        Exactly. They will say its about parking (which is probably partially true) but it is probably more about parties.