Lilly v. City of Minneapolis

SCHUMACHER, Judge

(dissenting).

The majority’s decision erodes the constitutionally recognized principle of home rule: local governance of areas of local concern. Minn. Const, art. XII, § 4 provides that a local government unit may adopt a home rule charter when authorized by law. A home rule charter

may provide for the establishment and administration of all departments of a city government, and for the regulation of all local municipal functions, as fully as the legislature might have done before home rule charters for cities were authorized.

Minn.Stat. § 410.07 (1992).

The supreme court has recognized that Minnesota’s constitutional and home rule provisions grant broad municipal powers to cities that adopt home rule charters. See, e.g., Mangold Midwest Co. v. Village of Richfield, 274 Minn. 347, 358, 143 N.W.2d 813, 820 (1966); City of Duluth v. Cerveny, 218 Minn. 511, 516-18, 16 N.W.2d 779, 783 (1944); Tousley v. Leach, 180 Minn. 293, 294, 230 *114N.W. 788, 788 (1930). Significantly, a home rule charter

has all the force of a charter granted directly by legislative act and in all matters pertaining to municipal government the provision of the home rule charter overrides general laws ivith respect to the same subject.

Northern Pac. Ry. v. City of Duluth (In re Condemnation by the City of Duluth), 153 Minn. 122, 125, 189 N.W. 937, 939 (1922) (emphasis added), quoted in Gadey v. City of Minneapolis, 517 N.W.2d 344, 348 (Minn.App.1994), pet. for rev. denied (Minn. Aug. 24, 1994).

A home rule charter city’s authority to act is not dependent on a specific statutory grant if it is acting pursuant to authority in its charter. Borgelt v. City of Minneapolis, 271 Minn. 249, 253-58, 135 N.W.2d 438, 441-44 (1965). Where a home rule charter covers a subject matter, there is a presumption that the charter “supersede^] all general laws on the subject * ⅜ * unless otherwise expressed.” Turner v. Snyder, 101 Minn. 481, 484, 112 N.W. 868, 870 (1907).

The City contends that it acted pursuant to the authority in its charter when it granted the employee compensation/benefits at issue here. I agree. The City’s charter is replete with provisions regarding compensation of employees. See, e.g., Minneapolis, Minn., City Charter chs. 6 § 2, 7 § 5, 9 § 7, 15 § 1, 16 § 1,17 (1991 & Supp.1994); see also id. at ch. 4 §§ 5, 17 (charter provisions authorizing city council to pass resolutions “for the government and good order of the City * * ⅜ as it shall deem expedient”); Minneapolis, Minn., Code of Ordinances § 20.10 (1991 & Supp.1994) (city council to prescribe compensation for city employees and officers).

There could be no dispute here that the benefits granted by the City’s resolutions 93R-106 and 93R-342 are compensation. The record reflects that employees will incur personal income tax liability for receipt of insurance reimbursements for blood relatives and for domestic partner health care insurance premiums paid by the City pursuant to these resolutions.

There is no basis to conclude that the legislature intended to preempt a home rule charter city’s power to provide compensation to its employees in the form of taxable healthcare benefits. In considering the issue of preemption, the Minnesota Supreme Court stated:

It is imperative, if we are to give faithful effect to legislative intent, that the legislature should manifest its preemptive intent in the clearest terms. We can be spared the sometimes elusive search for such intent if it is declared by express terms in the statute. And where that is not done in the enactments of future legislatures, we shall be increasingly constrained to hold that statutes and ordinances on the same subject are intended to be coexistent.

State v. Dailey, 284 Minn. 212, 214-15, 169 N.W.2d 746, 748 (1969), quoted in State v. Westrum, 380 N.W.2d 187, 191 (Minn.App.1986).

As appellants note, there are numerous statutes that, unlike the statute in question, expressly limit the power of a home rule charter city. See, e.g., Minn.Stat. § 471.633 (1992) (providing that the “legislature preempts all authority of a home rule charter” city to regulate firearms except as expressly provided by that statute); Minn.Stat. § 471.66, subd. 3 (1992) (providing that no elected officials, including those of “a home rule charter city * ⅜ * may receive monetary compensation for unused vacation or sick leave accruals”); Minn.Stat. § 471.665, subd. 1 (1992) (defining maximum amount officer may receive for mileage allowances, including employees and officers of “home rule charter * * * city”). The legislature’s failure to use preemptive language in Minn.Stat. § 471.61 indicates its lack of preemptive intent. See Dailey, 284 Minn, at 215, 169 N.W.2d at 748.

It is well-settled that a home rule city cannot pass legislation that “permits what La] statute forbids." Mangold, 274 Minn. at 352, 143 N.W.2d at 816 (emphasis added). There is no language in Minn.Stat. § 471.61 that forbids a home rule charter city from expanding the list of employee healthcare benefits. Further, a city’s ordinance or resolution does not conflict with state law if it is “merely additional and complementary to” a stat*115ute. Id. at 352, 143 N.W.2d at 817; see also Power v. Nordstrom, 150 Minn. 228, 232, 184 N.W. 967, 969 (1921) (where general statute prohibited doing certain things on Sunday but was silent as to indoor exhibition of motion pictures, city could nevertheless pass local legislation to prohibit such exhibition on Sundays); Markley v. City of St. Paul, 142 Minn. 356, 357-58, 172 N.W. 215, 215-16 (1919) (home rule charter city could' offer more compensation than provided in Workmen’s Compensation Act first enacted after city charter).

The majority concludes that such compensation is a matter of statewide concern requiring application of Welsh v. City of Orono, 355 N.W.2d 117 (Minn.1984). Welsh is distinguishable. Welsh involved the construction of the grant of authority to a statutory city under Minn.Stat. § 412.221 (1982). Id. at 121. A “statutory city” was defined as a city that had not adopted a home rule charter. Minn.Stat. § 412.016, subd. 1 (1982). This definition has not changed. Id. (1992). The City of Minneapolis has adopted a home rule charter and passed the resolutions under dispute while acting by authority of that charter. Thus, the body of law pertaining to the powers of a home rule charter city to act under its charter applies, not Welsh.

Welsh also is distinguishable because the City’s action here was of local concern. “[OJnce [a] municipality is granted a charter with a general welfare clause * * * that clause will be construed liberally.” Mangold, 274 Minn. at 358, 143 N.W.2d at 820. The issue is not whether the subject matter of the resolutions is “purely local” or whether there is some statewide application or concern that may be present, as the majority contends, but whether the subject matter being regulated is “solely a matter of state concern” and whether the local regulation “would have unreasonably adverse effects upon the general populace of the state.” Id.

I would conclude that the grant of medical benefits to city employees is solely of local concern and pertaining to management of municipal government. As amicus curiae Hennepin County aptly argues, the authority to define the scope of employee compensation, including benefits, is of particular importance to local government because of its impact on the “ability to attract and retain the employees needed to function at the highest level.” Cf. Christensen v. Minneapolis Mun. Employees Retirement Bd., 331 N.W.2d 740, 747 (Minn.1983) (retirement benefits affect the city’s ability to “attract and retain good employees”).

The legislature’s series of amendments to Minn.Stat. § 471.61 to increase the list of persons who may be covered under a municipality’s grant of employee health insurance is of little significance. Minn.Stat. § 471.61 is a general statute that applies to the numerous nonchartered entities listed therein. Had the- legislature intended this statute to provide a limited list, or to limit the power of a home rule charter city, it could have clearly stated so as it has in other statutes cited above. See, e.g., Minn.Stat. § 471.665.

Lilly contends that it is of statewide concern to limit the burden on taxpayers. Only city taxes, however, are used to compensate its employees. “Taxation for municipal purposes is purely a matter of municipal character.” State ex rel. City of Minneapolis v. Erickson, 157 Minn. 200, 206, 195 N.W. 919, 921 (1923). Lilly’s remedy is at the ballot box.

Finally, the claim that the City’s resolution impermissibly impacts state law and/or policy concerning discrimination and the definition of family and marriage is without merit. It is irrelevant that the state legislature did not intend to expand the definition of dependents contained in Minn.Stat. § 471.61, subd. la when it amended the Minnesota Human Rights Act to prohibit discrimination based on sexual orientation. The City was not acting under the Minnesota Human Rights Act or Minn.Stat. § 471.61, but instead voluntarily granted the challenged benefits/compensation under authority provided in its charter and ordinances. The issue is whether the City of Minneapolis may voluntanly provide these benefits to its employees.1

*116The majority’s reliance on a comment in City of Minneapolis Comm’n on Civil Rights v. University of Minn., 356 N.W.2d 841, 843 (Minn.App.1984), characterizing civil rights as a statewide problem is misplaced. In that ease, the Minneapolis Commission on Civil Rights attempted to investigate alleged civil rights violations at the University of Minnesota. Here, the City’s actions pertain to the City’s internal affairs and relate to a purely local matter, administration of city government, and not an issue “solely of statewide concern.” See Mangold, 274 Minn. at 358, 143 N.W.2d at 820 (providing “solely of statewide concern” standard). The City has not purported to change state laws prohibiting same sex marriage. State law and policy do not prohibit the City from providing benefits tó same sex domestic partners or to blood relations who live with employees.

I would reverse the permanent injunction.

. Although the City apparently passed the disputed resolutions in response to the order of its Civil Rights Commission, which found that the City's failure to provide health insurance for same sex *116partners of its employees was discrimination based upon sexual orientation, the City is not arguing now that a law required it to provide these disputed benefits. Its position is that it has a right to voluntarily offer group health insurance benefits to same sex domestic partners of its employees.