Can a Minnesota statutory city move its city-owned telephone and cable television companies under a public utility commission that operates independent of the city council?

Plain-English summary

The City of Crosslake is a fourth-class statutory city in north-central Minnesota that owned and operated both a city telephone company and a cable television company. The city had created a local utilities commission by ordinance to manage these businesses. The commission set written policies and ran daily operations, but the city council retained general supervisory authority. The council wanted to go further: create a commission that operated independent of council control.

Crosslake City Attorney Paul Sandelin asked AG Hubert Humphrey III whether the city had authority to create such an independent commission.

Assistant AG Kenneth Raschke, signing for AG Humphrey, said no. The 1998 opinion superseded an earlier 1968 opinion (same number, 624a-3) that had concluded such a delegation was authorized.

The reasoning had two layers.

First, the general rule: governance of a statutory city is vested in the council under Minn. Stat. §§ 412.111, 412.221, 412.241, and 412.271. Absent specific statutory or charter authority, local governing bodies cannot delegate powers calling for judgment and discretion. Muhring v. School District No. 31 (Minn. 1947) and the much older Minneapolis Gas and Light Co. v. City of Minneapolis (Minn. 1886) established the proposition.

Second, the specific delegation path the council wanted was Minn. Stat. § 412.331 et seq., which authorizes statutory cities to create public utility commissions with substantial operating authority independent of the council. But § 412.351 is express about which utilities can be placed under the commission's jurisdiction. It lists: (1) the city water system; (2) light and power system, including steam heat; (3) gas system; (4) sanitary or storm sewer system; (5) public buildings owned or leased by the city; and (6) district heating system. The same section then says: "the term 'public utility' means any water, light and power, gas or sewer system, or public buildings thus placed by ordinance under the jurisdiction of the public utilities commission."

Telephone and cable television are not in that list. Under the canon that enumerating things impliedly excludes others (Maytag Co. v. Comm'r of Taxation, with Lilly v. City of Minneapolis and A/AL, Inc. v. City of Faribault following), the omission of telephone and cable means the council cannot put those services under the commission's jurisdiction. The general statutory city authority to own and operate telephone exchanges and cable systems (Minn. Stat. §§ 237.19, 238.08, 412.014, 465.70) does not change the result, because that authority places the operations within general council governance, not within the specialized utility commission framework.

The AG noted that the 1968 opinion (624a-3, May 7, 1968) had said a village council could delegate operation of a television transmission system to the village utility commission under what was then § 412.351 (1965). On review of the 1965 and 1967 statutory text, the 1998 AG could not find the statutory basis for the 1968 conclusion, and the 1968 opinion supplied no explanation of its reasoning. The 1998 opinion superseded the 1968 one to the extent of any inconsistency.

Currency note

This opinion was issued in 1998. Subsequent statutory amendments, court decisions, or later AG opinions may have changed the analysis. Treat this page as historical context, not current legal advice. Verify current law before relying on any specific rule, deadline, or remedy mentioned here. Minnesota's statutory city utility framework (Minn. Stat. § 412.331 et seq.) and the enumerated utility list in § 412.351 have been amended since 1998. The growth of municipal broadband and changes to cable franchising law have shifted the policy context for city-owned telecom. The opinion's textual conclusion (that telephone and cable cannot be placed under the § 412.331-style commission without statutory amendment) was based on the 1998 statutory list; check the current version of § 412.351 before relying on the result.

Historical context: what the AG concluded

The opinion is a clean exercise in statutory text plus the delegation doctrine.

The default rule: council governance. Statutory cities are governed by their councils under the structure set in Minn. Stat. § 412.111 et seq. The council exercises judgment and discretion over city functions. Long-standing Minnesota case law (Muhring v. School District No. 31; the 19th-century Minneapolis Gas and Light Co. v. City of Minneapolis) holds that absent express statutory or charter authority, a council cannot delegate its discretionary powers to a separate board.

The utility commission as an authorized exception. The legislature carved out one structured exception: public utility commissions under § 412.331 et seq. These commissions can operate certain enumerated city utilities with substantial autonomy from the council. The council establishes the commission by ordinance and decides which of the listed utilities to place under it.

The list controls. Section 412.351 names the eligible utilities: water; light and power, including steam heat; gas; sanitary or storm sewer; public buildings; and district heating. The statute then defines "public utility" for purposes of §§ 412.51 to 412.391 to mean only those listed systems placed by ordinance under commission jurisdiction.

Expressio unius. The AG invoked the standard interpretive canon that an enumerated list impliedly excludes items not listed. The Minnesota Supreme Court applied it in Maytag Co. v. Comm'r of Taxation, and the Court of Appeals followed in Lilly v. City of Minneapolis and A/AL, Inc. v. City of Faribault. Because telephone and cable were not on the § 412.351 list, the council could not place them under the utility commission's jurisdiction.

Other authorities don't change the result. Minnesota law authorizes statutory cities to own telephone exchanges (§ 237.19), grant cable franchises and operate cable systems (§ 238.08), and operate utilities generally (§ 412.014, § 465.70). But those authorizations place the activity within ordinary city governance. They are not the same as authority to place the activity under a § 412.331 commission that operates independent of council control.

The 1968 opinion. The earlier opinion at the same number (624a-3, May 7, 1968) had concluded a village council could delegate operation of a television transmission system to its utility commission, citing § 412.351 (1965). The 1998 AG reviewed the 1965 and 1967 versions of § 412.351 and could not find statutory support for the 1968 result. The 1998 opinion superseded the 1968 opinion to the extent inconsistent.

The practical takeaway under the 1998 framework. Crosslake could continue to operate its telephone and cable companies, but management had to remain under city-council governance (perhaps with an advisory board or department, but not under a § 412.331-style commission with independent operating authority). To get the autonomy the council sought would require legislative amendment of § 412.351, charter conversion to a home-rule city with broader self-governance authority, or some other restructuring not addressed by the opinion.

Common questions

Q: Can a statutory city own a telephone company at all?
A: Yes, under Minn. Stat. § 237.19. The 1998 opinion does not question city authority to own and operate the telephone company itself; it only addresses whether operation can be delegated to a § 412.331 utility commission.

Q: What about cable television franchises?
A: Statutory cities can grant cable franchises and operate cable systems under Minn. Stat. § 238.08 and related provisions. Again, the issue in the opinion is the management structure, not the underlying authority to provide service.

Q: Why does this matter? What's the difference between council oversight and commission oversight?
A: A council retains political accountability for the utility; voters elect councilmembers who answer for utility decisions at the ballot box. A § 412.331 utility commission operates with substantial autonomy (the statute gives the commission authority to set rates, hire personnel, and make operational decisions independent of council control). Some cities want commission-style autonomy because it insulates utility management from short-term political pressures; the legislature chose to allow that structure only for the enumerated traditional utilities, not for telecom services.

Q: Could the city create an advisory board for telephone and cable management?
A: The opinion does not address advisory boards specifically, but Minnesota law generally allows cities to create advisory boards to assist the council so long as final decision-making authority remains with the council. An advisory body that does not exercise the council's discretion would not run into the Muhring delegation problem; it just cannot be a § 412.331 independent commission.

Q: What if the city is a home-rule charter city, not a statutory city?
A: This opinion addresses statutory cities (governed by Minn. Stat. ch. 412). Home-rule cities derive their authority from their charters and may have different rules about delegation to commissions. The general delegation doctrine still constrains charter cities, but the specific § 412.351 enumeration does not control them.

Background and statutory framework

Minnesota statutory cities are organized under Chapter 412 of the Minnesota Statutes. The chapter sets the powers, governance structure, and operating framework for cities that have not adopted home-rule charters. Within Chapter 412, sections 412.331 to 412.391 establish a public utility commission framework, allowing a council to create a quasi-independent commission to manage certain city utilities.

Section 412.351 is the gatekeeper. It lists the utilities eligible for commission jurisdiction:
1. Water system
2. Light and power system (including steam heat)
3. Gas system
4. Sanitary or storm sewer system (or both)
5. Public buildings owned or leased by the city
6. District heating system

The same section defines "public utility" for sections 412.51 to 412.391 as only those enumerated systems placed by ordinance under commission jurisdiction. Telephone and cable are conspicuously absent, despite the legislature's authorization elsewhere for cities to own and operate those services.

The delegation doctrine has deep roots in Minnesota law. Minneapolis Gas and Light Co. v. City of Minneapolis (1886) is the 19th-century anchor; Muhring v. School District No. 31 (1947) extended the doctrine to school districts. The general proposition: a local governing body to which the legislature has entrusted discretion cannot reassign that discretion to a separate entity absent specific legislative permission.

The expressio unius canon (Maytag Co. v. Comm'r of Taxation, 1944) is a standard Minnesota statutory-construction tool. The Court of Appeals applied it to municipal contexts in Lilly v. City of Minneapolis (1995) and A/AL, Inc. v. City of Faribault (1997). The canon is not absolute, but the 1998 AG found no countervailing indicator that the legislature meant the § 412.351 list to be illustrative rather than exhaustive.

Hubert H. Humphrey III was Minnesota AG from 1983 through January 1999; this opinion came in his final months. Kenneth E. Raschke, Jr. signed as Assistant AG.

Citations and references

Statutes:
- Minn. Stat. § 237.19 (statutory city authority over telephone exchanges)
- Minn. Stat. § 238.08 (cable franchising)
- Minn. Stat. § 412.014 (statutory city general powers)
- Minn. Stat. § 412.111 (statutory city governance)
- Minn. Stat. § 412.221 (general powers of council)
- Minn. Stat. § 412.241 (ordinances)
- Minn. Stat. § 412.271 (powers and duties of city officers)
- Minn. Stat. §§ 412.331 et seq. (public utility commission framework)
- Minn. Stat. § 412.351 (enumerated utilities under commission jurisdiction)
- Minn. Stat. §§ 412.361-412.371 (commission operating authority)
- Minn. Stat. § 465.70 (related general utility authority)

Cases:
- Muhring v. School District No. 31, 224 Minn. 432, 28 N.W.2d 655 (1947) (delegation doctrine)
- Minneapolis Gas and Light Co. v. City of Minneapolis, 36 Minn. 159, 30 N.W. 450 (1886) (early Minnesota delegation case)
- Maytag Co. v. Comm'r of Taxation, 218 Minn. 460, 17 N.W.2d 37 (1944) (expressio unius)
- Lilly v. City of Minneapolis, 527 N.W.2d 107 (Minn. Ct. App. 1995) (applying expressio unius to municipal context)
- A/AL, Inc. v. City of Faribault, 569 N.W.2d 546 (Minn. Ct. App. 1997) (applying expressio unius to municipal context)

Related AG opinions:
- Op. Atty. Gen. 1007, July 8, 1977 (delegation by local governing body)
- Op. Atty. Gen. 1001-a, September 13, 1950 (delegation by local governing body)

Superseded:
- Op. Atty. Gen. 624a-3, May 7, 1968

Source

• Landing page: https://www.ag.state.mn.us/Office/Opinions/
• Original PDF: https://www.ag.state.mn.us/Office/Opinions/624a3-19981102.pdf

Original opinion text

Best-effort transcription from a scanned PDF. Minor errors may remain, the linked PDF is authoritative.

PUBLIC UTILITIES: COMMISSION STATUTORY CITIES: City council is not authorized to delegate operation and management of telephone and cable television services to utility commission. Op. Atty. Gen. 624a-3, May 7, 1968, superseded. Minn. Stat. § 412.351.

624a-3
November 2, 1998

Paul J. Sandelin
Crosslake City Attorney
308 First Street
P.O. Box 298
Pequot Lakes, MN 56472

Dear Mr. Sandelin:

Your letter addressed to Attorney General Hubert H. Humphrey III, dated January 13, 1998, states the following

FACTS

The City of Crosslake is a statutory city of the fourth class that owns and operates its own telephone company and cable company. The city has adopted an ordinance that created a local utilities commission to manage and operate the telephone company and cable company. The commission establishes written policies to govern the day to day operations, but the city council retains general supervisory authority over the commission. The city council is now considering other options regarding the management and operation of the telephone and cable companies. The city's goal is to create a commission that would be independent of the city council.

Then you ask the following

QUESTION

Does the City of Crosslake have the authority to create a utilities commission to manage and operate the Crosslake Telephone and Cable companies independent of the City Council?

OPINION

We answer your question in the negative. Except to the extent otherwise provided by statute, governance of the affairs of the city is vested in the council. See e.g., Minn. Stat. §§ 412.111, 412.221, 412.241, 412.271 (1996). Caselaw, and prior opinions of this office have uniformly held that, absent specific statutory or charter authority, local governing bodies may not delegate their powers and duties calling for the exercise of judgment and discretion to other persons or bodies. See e.g., Muhring v. School District No. 31, 224 Minn. 432, 28 N.W.2d 655 (1947); Minneapolis Gas and Light Co. v. City of Minneapolis, 36 Minn. 159, 30 N.W. 450 (1886); Ops. Atty. Gen. 1007, July 8, 1977; 1001-a, September 13, 1950.

While there does appear to be authority for a statutory city to own and operate telephone exchanges and cable television services, [Footnote 1: See e.g., Minn. Stat. §§ 237.19, 238.08, 412.014, 465.70.] we are not aware of any statutory provision authorizing the delegation of the authority to operate such city functions to a board or commission independent of the supervision of the city council.

It could be argued that the council may delegate such operation to a public utility commission established pursuant to Minn. Stat. § 412.331 et seq. Unlike advisory boards and departments created at the discretion of the council to assist in management of city affairs, such a commission has substantial authority to operate the public utilities placed under its jurisdiction, independent of council control. See Minn. Stat. § 412.361-412.371. However, while telephone and cable services would seem normally to fall within the term "public utilities," Section 412.351 expressly limits the "public utilities" that may be placed under the jurisdiction of the commission as follows:

The council shall, in the ordinance establishing the commission, decide which of the following public utilities shall be within the commission's jurisdiction: (1) the city water system; (2) light and power system, including any system then in use or later acquired for the production and distribution of steam heat; (3) gas system; (4) sanitary or storm sewer system or both, including the city sewage disposal plant; (5) public building owned or leased by the city; (6) district heating system. As used subsequently in sections 412.51 to 412.391, the term "public utility" means any water, light and power, gas or sewer system, or public buildings thus placed by ordinance under the jurisdiction of the public utilities commission.

It is a general rule of statutory construction that "where a statute enumerates the persons or things to be affected by its provisions, there is an implied exclusion of others." Maytag Co. v. Comm'r. of Taxation, 218 Minn. 460, 463, 17 N.W.2d, 37, 40 (1944). See also Lilly v. City of Minneapolis, 527 N.W.2d 107 (Minn. Ct. App. 1995); A/AL, Inc. v. City of Faribault, 569 N.W.2d 546 (Minn. Ct. App., 1997).

Inasmuch as neither telephone nor cable television service is listed in section 412.351, we must conclude that management of those services may not be vested in a utility commission. We are aware that in Op. Atty. Gen. 624a-3, May 7, 1968, this Office opined that a village council was authorized by Section 412.351 (1965) to delegate operation of a television transmission system to the village utility commission. However, we have reviewed the wording of Section 412.351 as it existed in 1965 and in 1967, and cannot discern the statutory basis for that determination. Nor does the opinion itself supply any explanation of the process whereby that conclusion was reached. Consequently we do not find the previous opinion persuasive, and supersede it to the extent that it is inconsistent with this opinion.

Very truly yours,

HUBERT H. HUMPHREY III
Attorney General

KENNETH E. RASCHKE, JR.
Assistant Attorney General