In December 2023, our City Homes team was finalizing plans to build a new house in Edina when we received an unexpected fee from the city: a $19,000 deposit for permission to tear down a 35-foot tree that was in the way of the project. Our founder and president, Rebecca Remick, took it to Edina City Council, expressing concern about this new ordinance that had been put in place the previous year. The homeowner had recently become financially secure enough to make living in Edina a reality, but this newly discovered requirement made the dream of a perfect home more difficult to achieve.

We came to learn that this is a growing concern for many other homebuilders, property owners, and real estate agents. The Minneapolis/St. Paul Business Journal featured us in their most recent article, “Tree ordinances in Edina, Minnetonka raising ire of developers, homebuilders.”

According to Dean Dovolis, principal, CEO, and founder of DJR Architecture Inc., “Edina and Minnetonka are the fiercest on tree preservation.” While it’s important to understand the intention behind general tree ordinances, such as enhancing a community’s character and livability, trees require management and maintenance like any other community infrastructure. Enacting ordinances is a measure that communities can use to transition from reactive to proactive management, helping to avoid substantial, unexpected maintenance costs. However, some housing developers are concerned that tree ordinances are becoming stricter without consideration of economic feasibility, leading to less construction and limited new housing supply. For example, last month, the Minnetonka City Council denied two housing proposals in part due to the city’s tree ordinance. Those plans would have otherwise brought over 50 residences to the west-metro city.

“These are policies that we want to believe are well-intentioned, but the on-the-ground implications have real-world impact for the Edina homeowners or homeowners in Minnetonka or anyone that’s just looking to either build a house, remodel a house and the like,” said Mark Foster, vice president of legislative and political affairs at Housing First Minnesota, one of the state’s largest homebuilder associations.

Stated in the article, Edina updated its ordinance with new language and rules, including a requirement that the property owner must place cash in escrow or otherwise provide a letter of credit worth 110% of the value of replacement if they remove a protected tree for new construction. But the group of housing stakeholders who attended the Edina City Council meeting said the city didn’t accept the option for a letter of credit. In at least one case, the city required $75,000 in upfront cash to be stored in an escrow account, one of the homeowners said. The policy states that at least half of the money will sit for three years, accruing interest. At that point, the cash will be released back to the homeowner if the replacement tree or trees are still standing. In Minnetonka’s case, its tree ordinance was last updated in 2021. The revised law considered a tree protected based solely on size, rather than by species, while also lowering the size threshold for what would be considered a protected tree. It also added more limits on the amount of removal allowed and included single-family homes in having to abide by that limit.

Rebecca Remick responds with, “Edina’s ordinance goes too far. I love trees. It’s just, we have to figure out how to make it work for everybody.” Housing stakeholders say that the ordinance can make constructing new homes too onerous for potential homebuyers, who may seek out projects elsewhere, and that the market is already experiencing a lack of new housing.

To read more about the tree ordinance and the Minneapolis/St. Paul Business Journal’s solution to the pending issue, check out the link here to view the full article.