Haugland v. City of Bismarck
2012 ND 123
N.D.2012Background
- Haugland challenged Bismarck’s urban renewal plan under North Dakota’s Urban Renewal Act (N.D.C.C. ch. 40-58) and its use of tax increment financing (TIF) to fund downtown renewal.
- The Act authorizes renewal areas, plans, and financing, including TIF, to develop or rehabilitate blighted areas and related properties.
- Bismarck repeatedly modified its renewal plan: 1979 (initial amendment), 1979 (extension to ~35 blocks), 1984 (~17 more blocks), 1988 (Civic Center/ Mall), 1994 (potential six-block extension), 2006 (about 88 blocks) and 2010 boundary shift.
- Haugland alleged perpetual renewal, failure to ensure parcels are slum/blighted and suitable for renewal, improper notifications to the Burleigh County Auditor, improper TIF use, and improper CORE Incentive Program expenditures.
- The district court granted summary judgment upholding the Act’s constitutionality and Bismarck’s plan; the court remanded to resolve compliance with the Act and allocation of funds; Haugland appeals and Bismarck cross-appeals.
- The court ultimately affirmed in part, reversed in part, and remanded for further proceedings.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Constitutionality of the Act under art. X, §18 | Haugland argues the Act violates art. X, §18 | Bismarck argues the Act complies and supports urban renewal | Act constitutional |
| Whether urban renewal qualifies as an enterprise under art. X, §18 | Haugland contends renewal is not an enterprise | Bismarck contends renewal qualifies as an enterprise | Urban renewal constitutes an enterprise under art. X, §18 |
| Requirement and propriety of plan modifications | Modifications lacked proper findings/notice | Modifications complied with statute | Remand to resolve 1994 modification and related findings |
| Uniformity of taxation and equal protection | Tax increments violate art. X, §5 and equal protection | TIF taxes are uniform and serve public purpose | TIF scheme satisfies rational basis and uniformity under applicable standards |
| Perpetual nature of renewal and timing of termination | Renewal plan is perpetual and not properly terminated | Plan may continue until costs are reimbursed or conditions met | Remand to determine pending authorized renewal projects and proper termination |
Key Cases Cited
- Gripentrog v. City of Wahpeton, 126 N.W.2d 237 (ND 1964) (municipality may engage in enterprise and loan its credit under §185)
- Wentz v. City of Grand Forks, 103 N.W.2d 245 (ND 1960) (interpretation of §185; internal improvements exception to prohibitions on loans/credit)
- Nelson County v. State, 1 N.D. 88, 45 N.W. 33 (ND 1890) (seed-grain philosophy informing supports for the poor; historical context of §185)
- Thompson v. Jaeger, 2010 ND 174, 788 N.W.2d 586 (ND 2010) (constitutional interpretation; give meaning to each word; general construction principles)
- City of Jamestown v. Leevers Supermarkets, 552 N.W.2d 365 (ND 1996) (proper considerations for urban renewal actions and public purpose)
- Patterson v. City of Bismarck, 212 N.W.2d 374 (ND 1973) (urban renewal and government functions under Gripentrog framework)