Why Is Shorewood Arguing the Federal Government Overruled Minnesota's Water Laws?

A small property development in Shorewood has turned into a much bigger fight about water law, with the City of Shorewood taking the position that federal law overrules Minnesota’s own water laws that have existed for decades. At the center of it: does a 2023 U.S. Supreme Court case about federal water pollution law also rewrite Minnesota's own, separate wetland rules?

The city's own lawyer and the developer trying to build on the property both say yes. That’s a big deal and risks turning Minnesota environmental rules over to 5 justices in Washington, D.C. and overturning decades of independent Minnesota environmental protection. Does Shorewood really want to roll back environmental protections and leave the fate of Minnesota wetlands and waters to the federal government?

The Problem, in Plain English

Minnesota law lets small housing projects skip an environmental review assessment — unless the project is close to a lake or close to a wetland that is “adjacent” to a lake.  The "adjacent" wetland rule is based on environmental science – water flows and problems in one place move to others, so pollution in an adjacent wetland will flow and become pollution in the lake.

The developer of the Watten Ponds project in Shorewood claimed that its development deserves to use this exemption and avoid the environmental review. 

Residents noted that the large wetland on Eureka Road is close to the development and flows straight into Lake Minnetonka, passing twice under roads through direct piping or culverts. If the Eureka Road wetland is “adjacent” to Lake Minnetonka, then the exemption would not be available. 

The Shorewood City Council agreed that this wetland is “adjacent” to the lake, since the water flows directly and without obstruction to the lake, denied the exemption and required the environmental review. This decision is firmly in line with established Minnesota law.

But the City Attorney's written opinion said something different: that a wetland only counts as “adjacent” to the lake if it has a “surface water connection”. That is not Minnesota law, that is a specific, narrower rule that means that many wetlands like this one that flow into lakes or rivers would no longer be counted for environmental review.

Where That Phrase Actually Comes From

That exact phrase — “surface connection” — comes from a U.S. Supreme Court decision, authored by Samuel Alito with the support of 4 other conservative justices, called Sackett v. EPA. That case dealt with the federal Clean Water Act and, not surprisingly, dramatically shrank which wetlands the federal government protects.

Under traditional Minnesota law, the Eureka Road wetland is clearly adjacent to Lake Minnetonka.  If the Supreme Court case overrules Minnesota law, the Eureka Road wetland is not adjacent. By arguing that the wetland is not adjacent, the City Attorney is arguing that the federal law should overrule Minnesota law.

The City Attorney confirmed this in his statements at the City Council meeting - the City Attorney stated that the rule that should be used is consistent with federal rules and the recent federal Supreme Court decision - Sackett.

The City Attorney and the developer's lawyer don’t mention the Sackett case by name but use that federal rule to interpret Minnesota's law. In other words, by making Minnesota law follow federal law, they take the position that Minnesota law must become the same as federal law.

But they don’t say that explicitly.  The City Attorney's memo states that the rule came from a comment by an Environmental Quality Board (EQB) staff member.

What the State Employee Actually Said

But the City Attorney’s characterization of the EQB’s position isn't accurate. The EQB staff member's actual comment mentioned the Supreme Court case, then added an important warning: Minnesota law may be broader than the new, narrower federal standard. She did not advice one way or the other. In other words, the City Attorney would have to interpret the law himself.

But the City Attorney appears not to have done that, instead presenting the narrower federal test as if it were settled fact without any reference to Minnesota's broader laws. Residents told the City Attorney that his description of the EQB’s position was misleading — but he stuck with it.

That’s not just the opinion of residents.  Minnesota's own environmental agencies — the Board of Water and Soil Resources, the DNR, and the MPCA — said this in a joint report from January 2024. Their conclusion: the Supreme Court's decision doesn't limit Minnesota's ability to protect more wetlands than the federal government does. In fact, they noted that Minnesota's own wetland programs already protect more wetlands than federal law did, even before Sackett narrowed federal protections further.  But nonetheless, the City Attorney persisted in presenting his interpretation to the City Council.

Why This Matters Beyond One Property

It might be tempting to say, it’s just one location in Shorewood.  But the case is at the Minnesota Court of Appeals, and their opinions are relevant statewide.  If a court agrees with the City Attorney, the effect wouldn't stop at one wetland behind one small subdivision. The same reasoning would apply to any “adjacent” wetland, and in other situations where Minnesota's rules use similar wording to federal rules. Taken to its logical end, that would mean a single U.S. Supreme Court decision driven by five conservative justices could quietly override decades of Minnesota's own, more protective environmental rules — without the Minnesota legislature or any state agency ever voting to change a thing.

Does the City Really Want to Roll Back Decades of Environmental Protection?

This is a great question.  The federal approach has extreme effects – the decision eliminated federal environmental protections from tens of millions of acres of wetlands and water bodies, all to allow developers to build more easily . 

Does the City really want to roll back independent Minnesota rules simply to make development easier and cheaper?

This post discusses a pending appellate matter and is offered for general informational purposes; it is not legal advice.  This post reflects the opinion of the author.