Focus On New Laws: Requirement for Consulting Fee Estimates

July 8, 2019

The law creates new requirements for cities when applicants ask for consulting fee estimates.

A new law requires cities, upon request, to provide a written, nonbinding estimate of consulting fees to be charged to an applicant of a permit, license, or other approval relating to real estate development or construction.

Gov. Tim Walz signed this proposal into law as Chapter 27 on May 17. The new law, Minnesota Statutes, section 471.462, takes effect on Aug. 1.

Concerns about 60-day rule addressed

The estimate is required to be based only on information available to the city at the time of the request. In order to alleviate city concerns regarding the “60-day rule,” which requires cities to make a final determination within 60 days of receiving an application, the new law provides that an application is not deemed complete until the city has done all of the following:

  • Provided the written estimate to the applicant.
  • Received all application fees, as specified by the city.
  • Received a signed acceptance of the fee estimate from the applicant.
  • Received a signed statement from the applicant that the applicant has not relied on the estimate of fees in its decision to proceed with the final application.

The 60-day period begins when all requirements of the law are met.

Proponents of new legislation

T-Mobile was the main proponent of this new law. T-Mobile was particularly concerned about consultant fees related to antennas on city-owned water towers. These new requirements apply only to applications “relating to real estate development or construction,” which presumably includes these antennas.

Problematic provisions removed

The original bill would have required cities to engage in an annual request for qualifications from consultants, despite cities already regularly vetting professional consultants. The League successfully opposed this requirement, as it would have needlessly added time and cost to the city and private consultants alike.

The original bill also would have required cities to provide consultant fee estimates to applicants before review of any application. The League also opposed this requirement because it would be nearly impossible for cities to provide an accurate estimate without knowing the details of the application. The language was ultimately removed from the bill.