In March, Patrick Bollom sued the city of St. Paul, as well as the director of the city’s Department of Safety and Inspections and a plan review supervisor, claiming he had been overcharged for $1,960.78 in building permits to perform construction on his Berkeley Avenue home.
Rather than simply demand a partial refund on his own behalf, the Macalester-Groveland homeowner has maintained that his case forms the basis of a class-action lawsuit that could force the city to rewrite its permitting fees and possibly return $1.5 million to $6.6 million in overcharges per year to permit holders.
The cumulative citywide overcharges, according to his lawsuit, total more than $22 million from 2018 to 2023 alone, and were documented in the city’s own building reports to the Minnesota Department of Labor and Industry. Bollom, a self-described “serial entrepreneur” and former sales manager for technology consultants, has called for refunds, in essence, for everyone.
The city has denied Bollom’s claims and maintained that they’ve acted within their rights and duties to collect permit fees, including remittances required for state coffers. Still, City Hall’s efforts to get his lawsuit dismissed in Ramsey County District Court have been unsuccessful to date. In August, the city requested and received a 120-day pause in legal proceedings, given the impact of a weeks-long cyberattack that had made accessing city records difficult, if not impossible.
Continuance sought
On Nov. 10, St. Paul City Attorney Lyndsey Olson asked Judge Leonardo Castro for another 120-day stay in legal proceedings, given that most permitting records have yet to be transferred to the city’s new record-keeping software known as PAULIE. The judge’s response has yet to be filed. On Tuesday, Shawn Raiter, Bollom’s attorney with the St. Paul law firm of Larson King, filed a response indicating they were open to a partial stay on some aspects of the case but “there are numerous other things that can be accomplished without that data.”
If granted by Ramsey County District Court, the continuance would push the case into February, leaving unanswered legal questions in the lap of a new mayoral administration, and possibly a new city attorney, just as a new city budget rolls out amid federal funding cuts and other fiscal challenges.
State Rep. Kaohly Her this month won election as mayor over incumbent Mayor Melvin Carter, who had sought a third term in office. Her has not indicated whether she will replace all or most of the city’s department leaders and other top City Hall staff, but some officials have said they have no illusions that their time may be limited.
Pass-through fees or revenue generators?
The city council held a closed-door meeting last week to discuss Bollom’s litigation.
Building permit costs are determined by the city’s fee schedule and required for new construction and building additions, including certain plumbing, mechanical and electrical installation, as well as construction removal, remodeling or repair.
Bollom’s lawsuit notes that a state rule governing building permits says the fees must be “proportionate to the actual cost of the service for which the fee is imposed,” but some cities use building permit revenue to pad their general funds. The issue has been highlighted by some state lawmakers and housing advocates such as the Housing Affordability Institute.
Bollom maintains permit fees are intended to be a pass-through of actual costs related to permitting, and not a way to generate new general revenue. He noted that in October 2024, Minneapolis Mayor Jacob Frey vetoed new licensing fees related to carbon dioxide pollution, noting the fees would expose the city to legal action because they did not appear to be calculated around actual costs of service and likely would constitute, in the eyes of the law, an unauthorized tax.
Bollom said he was charged by the city for electrical permits, warm air permits, mechanical permits, a plumbing permit and a building permit, all of which added up to $1,960.78. His lawsuit does not specify the degree of refund he maintains he is entitled to. A call to his attorney was not returned Friday and efforts to reach him directly were unsuccessful.
He contends, however, that in the case of his Berkeley Avenue home, his permit costs “exceeded the actual cost St. Paul incurred to perform the services needed to review and approve the applications,” which he maintains violates the Minnesota Constitution, amounts to unlawful taxation, a due process violation, unjust enrichment and disgorgement.
Lawsuit
Filed March 11, his eight-count, 63-page lawsuit is seeking a “writ of mandamus” — or court order to the city to perform a legally required duty — and declaratory and injunctive relief. The city has denied all of his claims, including that they form the basis for a class action.
In addition to the city and the director of DSI, Bollom’s lawsuit specifically lists plan review supervisor James Williamette as a defendant. Williamette, a past chairman of the Association of Minnesota Building Officials, was featured in a 2019 investigative story by the Minnesota Star Tribune, which had uncovered an email that he had sent to fellow association board members — most of them municipal building officials — acknowledging that overcharges were both illegal and widespread.
“We all have to agree we know it has been happening. We all know that when we said something about it (it) fell on deaf ears,” said Williamette in the email, which is quoted at length in Bollom’s lawsuit. “We all know that pushing this issue with management was always difficult and a few of our peers were let go over this.”
Williamette said in the email that municipal building officials had little control over how the money is allocated, and “the fact is most cities depend on permit revenue to help balance the budget.”
Defendants released from case
In June, Castro granted the city’s request to release Williamette and DSI Director Angie Wiese as defendants in the case, as well as other unnamed city building officials, noting the lawsuit failed to state specific claims against them.
The city has rolled out the new online permitting and record-keeping software known as PAULIE, and it has yet to absorb all of the records that were stored in the previous interfaces, known as AMANDA and ECLIPS, according to the city attorney’s memorandum in support of a possible legal continuance.
PAULIE only contains complete records for permit applications submitted after July 25, as the city is still in the process of transferring older documents.
“DSI relies heavily on its digital portals relative to permit and plan reviews. The cyberattack severely impacted DSI in its ability to administer permits and review plans,” reads the legal memo. “Because of the cyber-attack’s impact on those systems, to date, the city has been unable to successfully transfer that data to PAULIE.”
On Tuesday, a spokesperson for the mayor’s office declined further comment, noting the city generally avoids commenting on pending litigation.
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