State law gives environmental groups the right to sue Minneapolis for failing to complete an environmental review before approving the 2040 Comprehensive Plan, the Minnesota Supreme Court ruled Wednesday morning.

Smart Growth Minneapolis, the Audubon Chapter of Minneapolis, and Minnesota Citizens for the Protection of Migratory Birds sued the city under the Minnesota Environmental Rights Act (MERA) in December 2018, just days before the City Council approved the long-range planning document.

The 2040 plan aims to boost density citywide in hopes of creating more affordable housing amid a burgeoning homelessness crisis. But the three groups said completing an environmental review first would help Minneapolis avoid pitfalls of rapid development, such as building in flood zones, exacerbating heat islands that are already concentrated in minority communities, and contaminating lakes.

The city argued that it still considers every building permit individually, and wouldn’t rubber stamp ecologically destructive projects just because the 2040 plan allows denser construction to be considered in areas where it was previously prohibited.

The district court dismissed the lawsuit in May 2019. The court of appeals affirmed, concluding that another law, the Minnesota Environmental Policy Act (MEPA), can exempt Minneapolis from environmental reviews when adopting comprehensive plans, as opposed to individual projects with the potential of impacting the environment. The advocacy groups failed to show how the 2040 plan would cause harm, the appeals court ruled.

The Minnesota Supreme Court heard the advocates’ last-ditch appeal in October 2020. The court’s opinion Wednesday, written by Justice Gordon Moore III, found that the groups had adequately argued a link between the 2040 plan and potential environmental effects, and that MEPA did not prevent the environmentalists from suing under MERA.

Now that the Minnesota Supreme Court has reversed the lower courts’ opinions, they will return to district court and ask for an immediate halt to new developments taking place under the 2040 plan, said Rebecca Arons of Smart Growth Minneapolis.

“This is a critical win for the environment and the future health of our city and its residents,” she said. “We have been given a false binary choice by the City of Minneapolis. It should be possible to have responsible development that provides better housing opportunities for all while also protecting the environment and addressing issues of environmental justice.”

Attorney and activist Nekima Levy Armstrong served on the groups’ legal team. “This legal challenge to the 2040 Plan being proposed by the city of Minneapolis provides a key opportunity to shine a light on the environmental impacts of the plan, coupled with the social justice issues that will have a disparate impact upon low income communities of color,” she said in a statement. “It is clear that the city failed in its duty to effectively engage the communities most impacted by this plan or to be transparent about the long-term unintended consequences that will ensue, which will likely include housing displacement and gentrification.”

The city did not immediately respond for comment.

When the plan passed in 2018 under City Council President Lisa Bender, it was widely lauded for its progressive emphasis on walkability and “yes-in-my-backyard” attitude to increasing housing supply along commercial corridors. Minneapolis also became the first city in the nation to end single-family zoning.

It still has its fair share of skeptics. City Council Member Lisa Goodman, who voted for the plan, and two challengers for her Ward 7 seat, Nick Kor and Teqen Zéa-Aida, have all said that while 2040 has admirable goals, it remains to be seen if it will truly create more affordability.

This is a developing story. Check startribune.com for updates.

Susan Du • 612-673-4028