This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2002).
STATE OF MINNESOTA
IN COURT OF APPEALS
State of Minnesota, acting through its
Commissioner of Transportation, et al.,
Northern States Power Company,
d/b/a Xcel Energy,
Filed April 8, 2003
Stearns County District Court
File No. C7014422
Mike Hatch, Attorney General, Ann K. Bloodhart, Assistant Attorney General, Suite 500, 525 Park Street, St. Paul, MN 55103 (for respondents)
Timothy R. Thornton, Thomas J. Basting Jr., Kristin L.C. Haugen, Briggs and Morgan, P.A., 2400 IDS Center, 80 South Eighth Street, Minneapolis, MN 55402 (for appellant)
Considered and decided by Lansing, Presiding Judge, Klaphake, Judge, and Stoneburner, Judge.
U N P U B L I S H E D O P I N I O N
The Commissioner of Transportation ordered a utility company to relocate utility poles located in the right-of-way of a trunk highway undergoing expansion. After the company refused to comply, the commissioner sued for declaratory and injunctive relief. The district court determined that the order was valid as a matter of law, granted summary judgment, and ordered removal of the utility poles. Because we conclude that the commissioner’s order was not arbitrary or capricious, we affirm.
F A C T S
The Minnesota Department of Transportation (MnDOT) conducted a study of the safety conditions on a two-lane segment of Trunk Highway No. 23 in Stearns County and determined that the road’s fatality rate was four times higher than expected on a four-lane road. Following the study MnDOT initiated a project to replace the two-lane roadway with a four-lane divided highway.
While planning the Highway 23 project, MnDOT determined that Northern States Power Company, d/b/a Xcel Energy (Xcel), had utility transmission lines and poles (utility poles) running along one side of the highway. The poles stood approximately ten meters from the road’s edge and within the right-of-way. Xcel apparently had at one time received an occupancy permit to locate the poles in the right-of-way, but the parties could not locate a permit.
MnDOT forwarded preliminary plan information to Xcel in October and November 2000 and informed Xcel at a February 2001 planning meeting that its poles would have to be relocated. At the end of March, MnDOT issued a formal notice and order which informed Xcel that relocation or adjustment of its poles would be required:
You are hereby notified that [MnDOT] will be performing construction upon, along and adjacent to Trunk Highway No. 23 * * *. Xcel Energy has certain electric utility facilities upon the right of way of Trunk Highway No. 23 within the limits of the construction project. Since the continued presence of the electric utility facilities will materially interfere with the construction, the relocation and/or adjustment of the electric utility facilities will be required.
The order required Xcel to submit a plan and detailed schedule of the relocation work within thirty days. Xcel did not comply and informed MnDOT by letter that it had
reviewed MnDOT’s construction plans and [found] that its existing poles do not interfere with construction of the new Highway 23 roadway. Although [the] contractor must grade around the poles, the grading can be accomplished without Xcel having to relocate or adjust its pole locations.
MnDOT then brought a declaratory action in district court seeking a declaration that Xcel was required to relocate the utility poles and an order requiring Xcel to carry out the relocation. After both parties moved for summary judgment, the district court entered judgment in favor of MnDOT. Xcel now appeals that judgment.
D E C I S I O N
On appeal from summary judgment, we determine whether there are any genuine issues of material fact and whether the district court erred in its application of the law. O’Malley v. Ulland Bros., 549 N.W.2d 889, 892 (Minn. 1996); see Minn. R. Civ. P. 56.03 (setting forth district court standards for summary judgment).
Xcel contends that the district court erred in granting summary judgment in favor of MnDOT because the relocation order was arbitrary and capricious. An agency’s decision is arbitrary and capricious when it is “based on whim or is devoid of articulated reasons.” In re Petition of Bailey, 626 N.W.2d 190, 196 (Minn. App. 2001) (quotation omitted). A party makes a prima facie showing of arbitrariness by demonstrating that the agency failed to “‘record any legally sufficient basis for its determination at the time it acted.’” Honn v. City of Coon Rapids, 313 N.W.2d 409, 416 (Minn. 1981) (quoting Zylka v. City of Crystal, 283 Minn. 192, 198, 167 N.W.2d 45, 50 (1969)).
MnDOT is charged with constructing, maintaining, and improving the trunk highway system. See Minn. Stat. § 161.20 (2002). The legislature has granted MnDOT broad authority over utility poles located within trunk highway rights-of-way. Minn. Stat. § 161.45. Private electric transmission lines may be maintained along trunk highways but
only in accordance with such rules as may be prescribed by the commissioner who shall have power to prescribe and enforce reasonable rules with reference to the placing and maintaining along, across, or in any such trunk highway of any of the utilities * * * set forth.
Id. at subd. 1 (2002).
The circumstances under which a utility must comply with a relocation order are set forth in Minn. R. 8810.3300, subp. 3. Xcel does not challenge the reasonableness of rule 8810.3300 in this proceeding. Under that rule,
[i]f at any time [MnDOT] shall deem it necessary to make any improvements or changes on all or any part of the right-of-way of the trunk highway which affect a utility located on trunk highway right-of-way, then and in such event, the owner of the utility shall within 15 days after written notice * * * proceed to alter, change, vacate, or remove said utility from the trunk highway right-of-way so as to conform to said trunk highway changes and as directed by [MnDOT].
Minn. R. 8810.3300, subp. 3 (2001). Therefore, MnDOT may order relocation of a utility once it determines that trunk highway improvements are necessary and that such improvements will affect utility facilities located in the highway right-of-way.
In this case, MnDOT determined that the improvements to Highway 23 were necessary to improve the road’s safety conditions and expand its capacity. MnDOT’s notice and order informed Xcel that MnDOT would be performing construction on, along, and adjacent to Highway 23; that Xcel’s poles were within the limits of the construction project; and that the poles would interfere with construction. Because these facts constitute a sufficient legal basis for ordering relocation under rule 8810.3300, and because MnDOT recorded these facts in its order, that order was not arbitrary and capricious.
Xcel raises two major arguments in opposition to the district court’s order granting summary judgment on its defenses to the relocation order. First, Xcel argues that a utility-relocation order is a quasi-judicial administrative action, which is therefore subject to a contemporaneous-written-record requirement. The term “quasi-judicial” applies to those administrative decisions that are based on evidentiary facts and that resolve disputed claims of rights. Meath v. Harmful Substance Comp. Bd., 550 N.W.2d 275, 279 (Minn. 1996). But the decision-making involved in a utility-relocation order does not address any disputed claims. As a permittee, Xcel has no right to maintain its facilities within a right of way, and its continued presence in the right-of-way is subordinate to proper exercises of the state’s police power. Minneapolis Gas Co. v. Zimmerman, 253 Minn. 164, 184, 91 N.W.2d 642, 656 (1958). That power includes the authority to require relocation of utility facilities in furtherance of public safety, security, and general welfare. Id.
In support of its position that relocation decisions are quasi-judicial, Xcel argues that because this court accepted certiorari jurisdiction in a previous utility-relocation dispute—a type of jurisdiction in which only quasi-judicial administrative actions may be challenged—we are bound to treat relocation orders as quasi-judicial. But in that case, N. States Power Co. v. Minnesota Dep’t of Transp., No. CX-02-287 (Minn. App. Sept. 3, 2002), the question of whether a relocation order is quasi-judicial was not addressed by the court. An appeal decided on the merits that does not address the issue of appellate jurisdiction is not precedential authority on the issue of jurisdiction. See Chapman v. Dorsey, 230 Minn. 279, 288, 41 N.W.2d 438, 443 (1950). Moreover, the earlier case involved relocation of utility facilities from a municipal right-of-way, not a relocation order issued as part of a trunk-highway improvement project. Xcel’s use of the municipal right-of-way is governed by a franchise agreement that entails the payment of a franchise fee. Xcel has not demonstrated that its rights under a trunk-highway right-of-way occupancy permit are equivalent to its rights under the franchise agreement. This distinction may be significant in light of Xcel’s payment of a substantial fee under the franchise agreement.
Second, Xcel argues that MnDOT acted arbitrarily when it issued the notice and order without first carrying out a cost-benefit analysis. According to Xcel, MnDOT was obligated to conduct such an analysis both by the terms of its Road Design Manual and because MnDOT performed a cost-benefit analysis before ordering utility relocation on a previous project. We disagree with both contentions. The Minnesota Supreme Court has rejected the concept that road designers must adhere to the Manual without the exercise of discretion. Fisher v. County of Rock, 596 N.W.2d 646, 654 (Minn. 1999). Further, MnDOT’s performance of a cost-benefit analysis on a prior project does not mean that it is required to do so in all subsequent cases. Each of the authorities cited by Xcel for the proposition that agencies must adhere to previous decisions and procedures involved agencies acting in an adjudicative capacity—that is, in the application of legal standards to facts determined in a quasi-judicial proceeding. MnDOT does not act in a quasi-judicial capacity when issuing a utility-relocation order.