The city of Fridley's plan to build a station along the Northstar rail line will have to overcome another obstacle: a lawsuit filed by the owner of a piece of land next to the proposed station.

In the suit, filed in federal court Friday, the property owner, Jeffrey Nielsen, alleged that the city is keeping his land under strict zoning regulations because it wants to use the parcel as a parking lot for the possible Northstar station.

The city has until Jan. 3 to respond, and City Manager Bill Burns said Tuesday that the city is in the process of retaining an attorney.

Nielsen also alleged that the city has prevented him from developing his 10-acre property for the past 11 years. His suit seeks damages in excess of $13.25 million.

In November, Fridley's Housing and Redevelopment Authority approved an agreement with the Anoka County Regional Railroad Authority (ACRRA) requiring the city to work on acquiring Nielsen's land next to the station.

Under the agreement, the ACRRA will pay for a $1.6 million tunnel that is needed for the station. Burlington Northern Santa Fe, which owns the tracks Northstar will run on, had previously told city officials they would need to commit to paying for the tunnel by Nov. 1 if they wanted a station.

While the city was working on the agreement with ACRRA this fall, Nielsen was petitioning the city to change the zoning so he could develop the land. In the suit, Nielsen said the city unfairly targeted his property in 1997, when the zoning was changed, and has since denied all of his requests to change the zoning.

Robert DeMay, Nielsen's attorney, said the city's agreement with ACRRA makes it clear that the city has tried to prevent development on the site so they could work on securing a Northstar station.

"The city made no mention of the Northstar rail even though the HRA [Housing and Redevelopment Authority] was hot and heavy into discussions of how they might acquire this property," he said.

Burns said the city is still committed to the agreement with ACRRA, including taking the initial steps to acquire Nielsen's property. The city also has to work on securing construction easements for the land because Burlington Northern is planning to construct the tunnel late next spring. The Northstar line is expected to begin service in 2009.

"We will be doing what we need to do under that agreement," he said.

DeMay said the decision on whether to sell the property to the city or another agency is separate from the suit.

"The recent activities have brought to light what my client believed was going on for years," he said.

Lora Pabst • 612-673-4628