Do watershed districts possess the power to license?

In re 1994 and 1995 Shoreline Improvement Contractor Licenses of Landview Landscaping, Inc., 546 N.W.2d 747 (Minn.App. 1996).

The Minnehaha Creek Watershed District (MCWD) was established under state law "to regulate improvements by the riparian property owners of the beds, banks, and shores of lakes, streams, and wetlands for preservation and beneficial public use." Minn. Stat. § 103D.201 subd. 2(11) (1994). The largest lake within the MCWD's watershed, Lake Minnetonka, is a highly urbanized lake with a steep shoreline. Lakeshore property owners frequently spend anywhere from $5,000 to $50,000 on riprap shoreline improvements to combat erosion, but these projects often failed to comply with the MCWD's shoreline protection standards. The MCWD adopted a licensing rule as a way to ensure that shoreline improvement contractors complied with these standards, in order to provide adequate shoreline protection and prevent erosion.

In May of 1993, the MCWD received evidence of multiple violations of its standards by Landview Landscaping. Following a public hearing concerning Landview's fitness for a shoreline contractor's license, the Board of Managers agreed to issue a license to Landview, subject to several conditions in light of these violations. The MCWD placed the same conditions on Landview's license for the following two years as well.

Landview appealed these license conditions to the Minnesota Board of Soil and Water Resources (BWSR), arguing that the District failed to provide due process and challenging the District's authority to license contractors. BWSR affirmed the MCWD's decisions in all respects, specifically finding that:

1. MCWD has authority to adopt rules to require permits for shoreline improvements;
   

2. licensing of shoreline improvement contractors is a reasonable means for MCWD to implement its regulatory program;
   

3. the conditions imposed on Landview's 1994 and 1995 Licenses are reasonable;
   

4. Landview had adequate notice and an opportunity to be heard.

In an attached memorandum, BWSR affirmed the MCWD's rationale for its licensing rule:

The need for the licensing of shoreline improvement contractors will vary from watershed district to watershed district. In the case of Lake Minnetonka, there is a great deal of shoreline improvement activity by means of placement of rip rap. The MCWD has determined that, in light of the amount of this activity and its potential for significant impact upon the watershed, it is necessary to ensure that rip rap and other shoreline improvements are properly constructed in accordance with MCWD rules and permit requirements.

Landview appealed BWSR's decision to the Minnesota Court of Appeals. The Court of Appeals held that the MCWD lacked statutory authority to license shoreline contractors.

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