Measure 37 may be dead after 62% of Oregonians voted for Measure 49 in 2007, but this attempt to undo our state's highly successful land use laws lives on in the courts — where a few would-be subdivision developers press on with their efforts to pave over Oregon's farm and forest land.
Today the Bend Bulletin related an all-too-familiar (to land use junkies like me) tale of a clueless Board of Commissioners and Circuit Court judge in a rural county who tried to twist vested rights law to benefit a well-to-do landowner, but were slapped down by the Oregon Court of Appeals.
(Irritatingly, the Bend newspaper doesn't have free online access. I forked out 50 cents for a copy of "Cost appeal delays 59-lot housing project." So I hope you'll appreciate this article if you read it in a continuation to this post.)
Having followed quite a few vested rights cases after the passage of Measure 49, I couldn't resist delving into the particulars of this case.
It didn't take long for me to grasp the broad outlines of this Crook County legal drama, which, as noted above, is depressingly similar to what's happened in Yamhill, Marion, Polk and other Oregon counties where the powers-that-be have a habit of ignoring the law if a big developer wants to go ahead with a Measure 37 project.
In this case, Shelley Hudspeth sought to complete development of a 59-lot residential subdivision. As described in the Court of Appeals ruling that overturned Crook County's green light "go ahead":
For purposes of appeal, the following facts are undisputed. Measure 37 waivers from the county and the state allowed for the development of a 59-lot subdivision on Hudspeth's property. Hudspeth obtained tentative approval from the county for a subdivision and expended hundreds of thousands of dollars to develop the property before Measure 49 became effective on December 6, 2007.
Thereafter, Hudspeth applied for a determination from the county that she had a vested right to complete and continue the use described in the Measure 37 waivers. Hudspeth's application indicated that the total project budget was $5,081,946. That figure, however, did not include the cost of residences that would ultimately be constructed in the subdivision.
Kind of a big oversight, to put it mildly. A residential subdivision without residences isn't much of a subdivison.
Measure 37 waivers don't allow a property owner to sell buildable lots. That's part of Land Use Law 101, which even non-attorneys like me who follow these sorts of cases know full well.
So it should have been obvious to the county planning director who went along with Hudspeth's omission of the expense of building 59 homes in her total cost of development that this was legally wrong, as it also should have been to the County Commissioners who later rubber stamped the vested right approval.
Reading through the minutes of the County Court (that's what some rural counties call their Board of Commissioners) hearing where the Hudspeth application was approved, I saw that some folks from 1000 Friends of Oregon and Central Oregon Landwatch tried to educate the commissioners about what the law required.
Their response: basically "Law, what law? We'll do whatever we want to do."
It's more than a little strange how common this attitude is among conservative county commissioners, who claim to be all big on law and order — except when they want to ignore the law in order to allow a deep-pocketed developer to do whatever he or she wants.
A Crook County circuit court judge went along with the county's weird legal reasoning.
Even though the Oregon Supreme Court has said that it is the ratio of total project costs to actual expenditures which is an important factor in determining whether someone is vested, both the judge and the commissioners cast a blind eye on what the Hudspeth subdivison would cost to fully build — including the expense of constructing 59 homes.
The Court of Appeals shot them down.
Consistently with those principles, we conclude, as we did in Friends of Yamhill County, Biggerstaff, and Kleikamp, that the circuit court "should have remanded for the county to determine the extent and general cost of the project to be vested and to give proper weight to the expenditure ratio factor in the totality of the circumstances." Friends of Yamhill County, 237 Or App at 178.
In this case, the county court determined that the denominator need not include the cost of the residences that were sought to be developed and the circuit court determined that it was unnecessary to determine the denominator in the expenditure ratio. Those are legal errors that require reversal.
Motion to dismiss denied; reversed and remanded.
The Bend Bulletin article quotes Hudspeth's attorney, Ed Finch, as predicting that the Crook County commissioners will end up approving the subdivision again, after which the state Department of Land Conservation and Development will appeal the approval again.
Likely, he's right.
But hopefully the commissioners will come to their senses and realize that they aren't above the law. I did some quick calculating and don't see any way that Hudspeth can show that she has spent the 7% or so of total project costs that is typically cited as a benchmark for passing the ratio test.
The Court of Appeals ruling says that both the county and circuit court judge said that Hudspeth had spent about $500,000 on the subdivision, even though the developer claims the total should be around $900,000.
Since Hudspeth and her attorney didn't challenge the $500,000 determination, it seems to me that this is a settled legal fact now. So what's left to determine is the additional cost of building 59 homes, adding that on to the $5,082,000 total project budget without homes.
Let's say that each home costs $200,000 to build, a really low-ball figure. That's $11,800,000. Added onto $5,082,000, the total project cost now is $16,082,000. With actual expenditures of $500,000, Hudspeth has spent only 3% of what it would have taken to complete her subdivison.
Almost certainly that's a "fail" on the ratio test, being a long distance from 7%.
So I bet that even if the Crook County commissioners find some way of rationalizing another vested rights approval after dealing with the remand, when the case gets sent back to the Court of Appeals the county will be slapped down again.
Eventually these Measure 37 cases will have run their course and Oregon farm/forest land can breathe a sigh of relief. (Poetically speaking, of course.)
That day can't come too soon for me, though I'll admit that my inner land use attorney gets some enjoyment from following the legal shenanigans in Crook County and other places.
Click on to read the Bend Bulletin article.
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