Resolution approving a Conditional Use Permit to allow wetland sequencing and replacement of 7.10 acres of wetland impacts. The subject property is described as part of the West 30 acres of the SW ¼, Section 15-108-26, except the South 330 feet of the West 330 feet thereof, AND The SE ¼ of the NW ¼ of the SE ¼; The S ½ of the NE ¼ of the SE ¼; The SE ¼ of the SE ¼; The SW ¼ of the SE ¼, except the West 30 acres thereof; all in Section 15, Township 108, Range 26, with some exceptions (Blue Earth County PID R430915400003 & R430915400009); by request of Thomas Ponce, on behalf of the property owner, Mesenbrink Construction.

At the July 24, 2024, meeting, the Planning Commission recommended the adoption of the resolution approving the conditional use permit with the following findings:

1. The proposed request, sequencing and replacement for wetland impacts, is considered a Conditional Use Permit in Mankato City Code section 10.82 subd. 11.
2. The request is in keeping with the comprehensive planning policies of the City as the underlying land use plan identifies this parcel as having the uses that are proposed in the overall development plan.  
3. The proposal does not interfere with or diminish the use of property in the immediate vicinity.  
4. The development will be served by public facilities and services. 
5. The proposal, wetland impacts, does not cause undue traffic congestion. 
6. There are no known historical or architectural resources on the site. 
7. The proposal seeks to preserve the unnamed lake wetland basin located on the northerly side of the parcel. The wetlands proposed for impact and replaced are wetlands that have historically been in crop rotation and have been heavily degraded by the removal of wetland hydrology and hydrophytic plant communities. 
8. It will not cause a negative cumulative effect and effect on the City as a whole. 
9. To the extent known, the development, when considered with the recommended conditions, conforms with all other applicable regulations of the district, and other applicable ordinances. 
10. The proposal will not jeopardize the public's health, safety, or general welfare. 
11. The proposal conforms to the Wetland Conservation Act.

The next action for this property will be the final plat review. The final plat will not be submitted until the Public Waters Permit is approved.

Thomas Ponce, agent, on behalf of the property owner, Mesenbrink Construction, is seeking a conditional use permit to allow wetland sequencing and replacement (full report) of 7.10 acres of wetland impacts. The subject property is described as part of the West 30 acres of the SW ¼, Section 15-108-26, except the South 330 feet of the West 330 feet thereof, AND The SE ¼ of the NW ¼ of the SE ¼; The S. ½ of the NE ¼ of the SE ¼; The SE ¼ of the SE ¼; The SW ¼ of the SE ¼, Except the West 30 acres thereof; all in Section 15, Township 108, Range 26, Blue Earth County, Minnesota, with some exceptions. (Blue Earth County PID R430915400003 and R430915400009).

Mesenbrink Construction proposes the construction of a mixed-use development located on approximately 105 acres in Blue Earth County. The project development plan includes constructing the project from west to east, starting with retail/residential units on the west side of the property. Then the development transitions into apartment units in the middle of the development, finishing with single family homes on the east side of the property. 

Annexation of the development property to the city of Mankato occurred on June 5, 2024. The City of Mankato City Council approved a preliminary plat with conditions on April 8, 2024. Included in those conditions was a requirement that prior to the submission of a final plat or further approvals for the site, wetland impact and replacement approvals be in place. 

The applicant has submitted a conditional use permit application to the City of Mankato which seeks approval for permanent impacts to 7.10 acres of wetland areas on the subject development property. Mankato City Code section 10.82, subd. 11 states that sequencing and replacement plan decisions under Minnesota Rules, Parts 8420.0520 through 8420.0550, shall be treated as a conditional use. In addition to City of Mankato approval, all wetland impacts will be required to be properly permitted through the Minnesota Department of Natural Resources (DNR), Wetland Conservation Act of Minnesota (WCA) and Section 404 of the Clean Water Act (CWA). 

The site was evaluated for wetlands prior to its annexation, and a total of 12 wetland basins were determined to be located in the subject development area, having a total area of 7.10 acres. Basin 1 is the only wetland under the jurisdiction of the DNR, and the Clean Water Act (CWA). 

The remaining eleven wetlands are only under the jurisdiction of the WCA. These eleven wetlands have historically been in crop rotation and have been heavily degraded by the removal of wetland hydrology and hydrophytic plant communities. Due to the degradation that has occurred, these wetlands are eligible for sequencing flexibility. MN Rule 8420.0520, Subpart 7a.A.1, allows for flexibility in sequencing if the wetlands to be impacted have been degraded to the point where replacement would result in a certain gain in functional and public value. There are several highly functional wetland banks in the Le Sueur River watershed with available wetland credit. Impacts to wetlands as a result of this project are proposed for mitigation within the same major watershed, allowing a functional lift to the watershed. 

The sequencing exercise requires that impacts to wetland areas are required to be avoided and minimized if practical alternatives exist. The following no-build and alternative and total wetland avoidance alternatives have been provided. 

1. No Build: The no build alternative was considered for this project to avoid impacts to wetlands. The no-build alternative would avoid impacts to wetlands. This project is in accordance with the City of Mankato’s Land Use Plan and is designed to meet the continued growth of the City. Additional multiple-family and single-family units are needed to meet the growing population in this area. If this project is not completed, the City will not receive the benefit of the expanded residential capacity that this project would provide. The no-build alternative is not considered feasible for these reasons.

2. Alternative Site Layout – Total Wetland Avoidance: An alternative site layout was considered. The alternative site layout would result in 62 single-family residential homes versus 106 in the proposed development, which is a 42% reduction. It would also result in the loss of approximately 228 multifamily residences. The alternative layout also loses the clubhouse and pool amenities that are present in the proposed project. The Mankato Code of Ordinance requires no less than 2 parking spaces per multifamily unit. The alternative site layout is unable to meet that requirement.

Additional multiple-family and single-family units are needed to meet the growing population in this area. With the reduced housing in the alternative site plan, the City would not meet the demands of the projected growth of 335 to 350 households per year.

Avoidance of Basin 1 could be achieved by installing the culvert outfall upgradient of Basin 1. Due to the existing slope at the edge of Basin 1, scouring would likely occur, leading to sedimentation in Basin 1. This option would have an indirect impact leading to sedimentation and downgradient water quality loss. For the reasons stated above, it is considered not a feasible alternative.

Wetlands (basins) 2, 3, 4, 5, 6, 7, 8, 9, 10, 12, and 15 are isolated and degraded seasonally flooded basins. These basins receive hydrology primarily from spring rains and snow melt. Development on the property (increased impervious surface) in the vicinity of the wetlands and diversion of stormwater would result in losing the hydrology necessary to maintain the wetland hydrology (water table within 12-inches of the surface for 14 consecutive days during the growing season).

The City of Mankato and City of Eagle Lake have an agreement that as the cities grow together, efforts will be made to direct Eagle Lake’s sewage to the Mankato sewage treatment plants. This entails including the necessary sanitary sewer infrastructure in all future development. As part of this plan, this development proposes the installation of sanitary sewer at a depth of 30 to 35 feet to allow for a gravity fed sewer system from Eagle Lake. The cost of this large and deep installation to meet the growth demands is expensive. In November 2022, the Mankato City Council adopted Ordinance No. O-2022-1114-16, creating Mankato City Code Chapter 10, Section 10.65, “Shoreland Overlay District.” This ordinance reduced the original concept for this development by approximately 200. The reduction of units and the required depth of the sanitary sewer interceptor, leave the preferred plan as the only viable option to achieve the goals of the city and developer. Further reducing units would render this development and the construction of the interceptor pipe infeasible.

For all of the above reasons, the alternative site plan is not considered a feasible alternative.

The applicable standards require that unavoidable impacts to wetland areas be minimized to the greatest extent practical. The following minimization efforts were included through the design process:

• Sediment and erosion control procedures will be followed with the project.
• Stormwater ponds were designed to MPCA standards.
• Basin 1 will be impacted to the least extent possible.
• Buffers will be maintained from the Public Water Basin Ordinary High Water Level (OHWL).
• Equipment will not be stockpiled in Basin 1
• Disturbed areas will be revegetated as soon as possible.

Permanent wetland impacts are proposed for replacement and mitigation through a federal and state approved wetland bank with approved credits available at a ratio of 2:1 for a total of 14.20 credits. The following siting was used to determine the banks: 

• On-site mitigation is not viable because the wetland mitigation site would be connected to the stormwater treatment system to maintain hydrology. Even with proper treatment of stormwater, the stormwater input to a restored wetland would have adverse effects on the native plant community. The pollutants that still remain in the treated stormwater would promote growth of aggressive species such as reed canary grass and hybrid cattail.
• Bank #1720 is in the same Bank Service Area (BSA 9), the same major watershed (Le Sueur River - 32), and the same County as the wetland impacts. The required 14.20 wetland credits are available and will be drawn from this bank. As a replacement, the applicant is proposing to purchase wetland bank credits at a ratio of 2:1, thus 14.2 wetland bank credits, from a wetland bank located in Blue Earth County in the same major watershed and the same bank service area.

In May 2024, the applicant prepared hydrology modeling for the subject development, and well as adjacent impacting developments. The results showed that the temporary water surface elevation increase rose slightly, a .37 foot bounce from historical to proposed conditions, with the impervious increases across the drainage area. The applicant is working with the Minnesota Department of Natural Resources (DNR) on a Public Waters permit on the proposed impacts to the Unnamed Lake as a result of the development, and, as was required in the preliminary plating requirements, the Public Waters permit will be required to be in place prior to the submission for a final plat or additional zoning actions. 

The proposed impacts were reviewed by the Technical Evaluation Panel (TEP), which consists of City staff, staff from the Blue Earth County Soil and Water Conservation District, staff from the State of Minnesota Board of Water and Soil Resources and staff from the Department of Natural Resources. During their meeting on July 17, 2024, the TEP found that the applicable standards for sequencing and replacement were achieved. The TEP recommended conditions of approval which include that the final site plan containing the hydrologic capacity satisfying the DNR requirements shall be provided, if modeling through the DNR Public Waters permit process, or for other reasons, requires additional or different wetland impacts, additional review and approval through the TEP will be required, and that previous conditions of approval on the preliminary plat be adhered to including that the applicant shall install stalls along the wetland boundary.