Legal Perspective

Keys to Minimizing Land Use Disputes and Other Local Government Issues
By Mark Hanson & Todd Guerero | October 01, 2004
Development projects often generate disputes with local government-be it a city council, county board or even a township board-over a zoning issue, permit requirement, wastewater treatment agreement, or a similar land-use or environmental issue.

For example, an ethanol plant, biodiesel plant or other agribusiness facility planning to expand its operations can encounter significant problems from the local permitting authority in obtaining a Conditional Use Permit that must be issued before the facility can be expanded. Similarly, a processing facility that discharges into the local municipal wastewater treatment system can end up in dispute with the city government about the rates it must pay for wastewater treatment, or its ability to expand because of limitations in the city's ability to handle the increased wastewater load. In addition, a negative impact on facilities can occur when local government allows zoning changes in the immediate vicinity that lead to establishment of new, conflicting land uses adjacent to or near their facilities.

A key step in helping prevent these types of problems from occurring, or in managing them once they do occur, is for facility managers and boards of directors to maintain good working relationships with the local elected and appointed officials that have jurisdiction over their facilities.

It is also important to monitor zoning and other regulatory actions taken by the city council, county board and township board, as well as the actions of the local planning and zoning staff, for ordinances and permit conditions that could negatively impact your business. For companies that discharge to the local wastewater treatment facility, it is essential to have a well-drafted Wastewater Treatment Agreement that clearly establishes the rate structure and a reasonable, controlled process for rate increases by the local government.

For start-up facilities, it is often useful to negotiate and enter into a Development Agreement with the local governmental units. The Development Agreement outlines the roles local governments and the project developer will take in the project for providing local infrastructure, such as road improvements and wastewater treatment expansion. Tax increment financing and other local funding assistance, as well as any requirements upon the agribusiness to create a certain number of new jobs, are often also addressed in a Development Agreement.

Although dealings with your local government unit regarding land use, permitting and other issues can become contentious, it is a good practice to maintain good relations with, and consistently monitor the actions of, your local elected and appointed officials. It's also essential to have clear, useful written agreements and permit conditions with local authorities that minimize the potential for future disputes.

Mark Hanson and Todd Guerrero are members of the agribusiness and alternative energy practice group of Lindquist & Vennum PLLP, a leading provider of legal assistance on bioenergy projects throughout the country. They can be reached at (612) 371-3211.
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