By Alison Rice. The dispute between Lake Elmo, Minn., and the Metropolitan Council resembles a familiar storyline in the density wars: A small rural community on the suburban edge refuses growth, citing traffic concerns and other issues. Thwarted, builders and developers either downscale their projects or leave for friendlier communities.

But there's an important difference between that scenario and the situation playing out in Minnesota, which involves a disagreement over Lake Elmo's comprehensive plan, a long-range land planning document that localities create to address and manage future growth. The rural St. Paul suburb hasn't told a builder that it doesn't want development--it has told that to the Metropolitan Council, a regional planning agency charged by state law to review and approve the comprehensive plans of nearly 200 localities in the Minneapolis/St. Paul area, a responsibility it's held since 1995.

"We haven't paid the first [legal] bill yet. It's going to be pricey," Lee Hunt, Lake Elmo's mayor, says of the brewing legal battle. "But the residents of Lake Elmo should have some say in what we do, and not have someone else come in and plan for us."

Suburban standoff

The debate represents the first time a Twin Cities locality has seriously challenged the regional agency's plans for its community, and the Metropolitan Council isn't taking it lightly. With strong words, it rejected Lake Elmo's comprehensive plan in September, asserting "Lake Elmo failed to acknowledge the law that requires balancing the future planning of the city ... with its long-established place in the economic and environmental health of the region."

With neither side backing down, it's up to an administrative law judge to rule on the case. Given its overlapping issues of property rights and local and regional control, the case could potentially impact Minnesota's regional planning efforts, which have attempted to address the thorniest issues of cities and suburbs--roads, sewer, transit, affordable housing, fiscal disparities--on a regional basis.

As such, everybody's watching, but nobody's willing to take bets on the outcome. "It's anybody's guess as to what will happen," says Rick Packer, who heads the Builders Association of the Twin Cities public policy committee and works for Arcon Development, an Edina, Minn.-based land developer. "No one has ever forced the Metropolitan Council's hand to this point."

Photo: John Oresnik

Dueling visions

The dispute centers on a corridor of land along Interstate Hwy. 94, Lake Elmo's southern boundary against Woodbury, Minn., one of the fastest-growing suburbs in the Twin Cities.

Concerned about the intense development of its neighbor, Lake Elmo wants this boundary land to remain rural, with a limited amount of campus-style office space. Growth should instead go in the village center, where the town says it would welcome more dense and more diverse residential development, from townhouses to senior housing. "Our goal, in a hometown setting, is to provide a mix of housing and prices downtown," says Hunt. "How many people want to live on a freeway?"

The Metropolitan Council, in contrast, has pushed for growth along transportation and infrastructure corridors as it seeks to accommodate an estimated 3.1 million residents by 2020. It wants this section of Lake Elmo to absorb more commercial and residential development, and it's willing to provide the infrastructure--$10 million worth of sewer--to serve growth that the city's village center plan merely begins to address.

"The sense of the village plan is to develop on septic tanks, so the amount of housing and number of jobs Lake Elmo will be able to contribute to the regional goals are very restrained," says Marc Hugunin, a Metropolitan Council member who represents Lake Elmo and portions of surrounding Washington County on the 17-member-appointed board. "The question is--how much of the regional burden are they willing to carry?"

The answer to that may seem relatively obvious, given the town's actions, but the real question a Minnesota judge will have to answer is how much of that burden should be carried by Lake Elmo, which benefits from regional investments such as parks and tax-base sharing.

Packer, the developer and a former Metropolitan Council member, supports both independence for the town and tough financial love. "If Lake Elmo wants to remain small and rural, that's fine, but as the regional planning authority, it's the Council's responsibility to figure out where growth and infrastructure is going to go ... Lake Elmo can't say, 'We don't want to grow, but keep the money coming.' Why give the money out to communities that fought urbanization and suburbanization?"