Unraveling Measure 37 Details could tie sprawl-threatening measure up in knots. By Alan Pittmann A million Oregonians voted for Measure 37, passing it by a 20 percent margin and putting it into effect Dec. 2. But land use and legal experts are still trying to figure out what the measure means. The timber- and developer-backed group, Oregonians in Action (OIA), that put 37 on the ballot says it means government now has to compensate owners for any reduction in property value caused by many land use regulations or waive the regulations. That sounds simple, but the devil is turning out to be in the details. How those legal details are decided by courts will determine whether Measure 37 ends up allowing ugly and expensive urban sprawl to destroy Oregon's scenic livability or ends up so tied in legal knots that it has far less impact. Transfer Knot One big legal tangle is whether any waivers of regulations would transfer to a new owner of a property. Eugene City Attorney Glenn Klein says they would not. Klein points to language in Measure 37 stating that a government may waive regulations to "allow the owner" to use the property for an otherwise unpermitted use. The measure text defines "owner" as "the present owner of the property." "My reading of it is it is not transferable," Klein told the Eugene City Council. Under Klein's interpretation, landowners could get waivers to allow themselves to build McDonald's restaurants on residential streets, but they couldn't transfer the waiver by selling the property to the McDonald's Corporation to build the fast food restaurant. If an owner built the building and then sold it, the city could force any new owner to tear down the McDonald's. This transferability interpretation could block much of the sprawl and damaging development opponents feared from Measure 37. Klein told the council that attorneys for big developers have told him they don't plan to use the measure because waivers wouldn't transfer. Banks would be unlikely to lend money to a developer using the measure if a waiver couldn't be transferred to a new owner. That could leave only self-financed development in which the owner couldn't sell the property. A timber baron couldn't make a killing by cutting up cheap forest land to sell off for luxury homes. OIA calls this interpretation favored by attorneys for the cities of Eugene, Beaverton and Bend "outlandish," on it's web site. The cities' actions are "an obvious attempt to circumvent the intent (and the express language) of Ballot Measure 37, by cities and their lawyers who have no respect for the message sent by Oregonians on November 2nd," OIA states. The timber barons and developers backing OIA stand to make millions converting cheap forest land to urban sprawl and have more than enough money to challenge cities in court. Local timber baron Aaron Jones contributed $243,000, almost a third of the money used to pass Measure 37. Other local timber baron/developers also invested heavily in the measure: Donna Woolley $25,000, Greg Demers $17,000, John Musumeci $25,000 and the Gonyea and Giustina families $10,000 and $20,000 respectively. Klein's interpretation on the transferability of Measure 37 waivers isn't accepted by all local governments. A memo from the Portland law firm of Beery, Elsner and Hammond, which represents about a dozen small cities in Oregon, advises that the firm at present believes that a waiver would transfer to a new owner. But another memo from Multnomah County staff agrees with Klein that a waiver is limited to a use of the property by the present owner and is arguably not transferable. Eugene mayor Jim Torrey, a Republican elected with a flood of developer contributions, said Eugene voters didn't pass the measure but the state did and he doesn't want the city to impose a transferability "gotcha" that would prevent development using Measure 37 waivers. Torrey and the current council's pro-developer 5-3 majority, revised an implementation ordinance to remove language referring to Klein's interpretation on transferring waivers. Councilor Bonny Bettman said the council shouldn't try to "make up for the mistakes of the authors of the measure." She predicted that allowing waiver transfers would "result in an industry of opportunistic entities seeking out Measure 37 claims." But Klein told councilors the change to the implementation ordinance would have little effect. Klein said he would advise city building permit staff to not recognize a transferred Measure 37 waiver and the whole issue would likely end up decided by the courts. In court, the state land-use watchdog group 1000 Friends of Oregon will likely be there siding with Klein's interpretation. The group's staff attorney Mary Kyle McCurdy says, "We believe that Measure 37 is clear that a waiver or modification of a land use regulation applies to the current owner of the property and does not run to a new owner." While OIA now says the intent of Measure 37 was to allow transfers of waivers, that may not have been clear to voters during the campaign. For example, a big part of OIA's campaign centered on a Bend-area couple hoping to build a rural retirement home for themselves. There was little mention of timber barons receiving multimillion-dollar windfalls from subdividing cheaply acquired forest land.   Knotted Knots Besides the big question of transferability, there are a lot of other legal knots that could tangle Measure 37. Here's some of the more tangled ones: Exemptions — The measure explicitly exempts regulations regarding public nuisances, public health and safety, pollution control and those regulations required to comply with federal law. But the measure offers few details. A city could argue that allowing a shopping mall or a McDonald's could create safety hazards from traffic and/or create nuisance traffic congestion or exhaust and grease smells. A government could argue that a regulation requiring wide stream setbacks is for stormwater pollution control and is required by federal Clean Water Act regulations. OIA argues that the exemptions are narrow and courts will likely have to make the difficult decisions on how broad the vaguely-worded exemptions are. Appraisals — Determining how much to compensate a landowner will require an appraisal of how much the property would be worth without the regulation. That could be difficult, given the laws of supply and demand. For example, if you own the only site in town where a billboard is allowed, then your property is worth a lot. But 1000 Friends argues that if Measure 37 means billboards can go up all over town, then your property is worth far less for that use. Services — Valuable development often requires taxpayer subsidized services such as roads and sewers. But governments could refuse to extend services to development allowed by Measure 37. OIA suggested as much in arguing, "there is nothing in the measure that requires local governments to extend urban services like roads, water and sewer to development outside the UGB [urban growth boundary]. Measure 37 will not allow urban type developments in rural areas, like large retail stores, shopping malls, apartments, or large factories." However, OIA did not address whether the measure would allow near-urban subdivisions and strip malls on septic systems sprawling across scenic rural areas, rendering UGBs meaningless. Suing developers — Eugene and other cities have included a private cause of action in their implementation ordinances allowing neighbors whose property value is reduced by nearby Measure 37 development to sue the developer for damages and legal costs. OIA objects that such provisions are designed to intimidate landowners from filing claims and will result in city liability and expansion of such lawsuits to other property transactions. Fees — Eugene and other cities plan to charge fees to recover the taxpayer costs of processing Measure 37 claims that could result in windfall profits. OIA objects that high fees are designed to frighten away claimants and says that they will only result in claimants dodging the fees by using a measure provision allowing them to go directly to court to pursue their claim.   Tossing the Tangle Klein and other city attorneys have told their clients that they doubt that Measure 37 can be successfully challenged in court and thrown out in its entirety as a similar Measure 7 was four years ago. As a constitutional amendment, Measure 7 was more vulnerable to claims that it violated prohibitions against a single measure containing multiple legal measures. But environmental attorneys are exploring other options. For example, Measure 37 could be challenged for the very vagueness that has attorneys all over the state arguing and scratching their heads right now, according to Charlie Tebbutt, a staff attorney with the Western Environmental Law Center in Eugene. "It's incredibly vague," says Tebbutt. The state constitution provision requiring laws to be understandable and clear "certainly seems to apply to Measure 37," he says. "Measure 37 is anything but clear," he says, noting that a successful "void for vagueness" challenge "would toss out the whole thing." Tebbutt says there's enough people who want to control sprawl to fund any litigation on the vagueness or other possible approaches. "Every option will be looked at carefully," he says. "It will be challenged properly." Another legal strategy would be to challenge the measure for violating equal protection provisions in the state and federal constitutions. Measure 37 treats citizens radically different based on when they or a family member acquired their land. While the measure could result in similarly situated property owners with widely different regulations, it's unclear whether the courts would overturn the measure on that basis. California's Proposition 13 lead to radically different taxes based on when homeowners bought their property. But the Supreme Court construed that such discrimination was rational because it served the public purpose of promoting neighborhood stability through long-term home ownership among other benefits. Measure 37, however, maybe on shakier ground as it extends benefits based not only on when a the current owner acquired the property, but on when a grandparent did.   Knotted Oregon Even if Measure 37 ends up tangled in legal knots, it could still have a dramatic impact. Already local government attorneys are advising clients to hold back on needed new regulations to protect livability and control sprawl for fear of Measure 37 claims. The state has said it will also hold back on new regulatory efforts. Robert Liberty, who led 1000 Friends through the storm of Measure 7 and was just elected to serve as a Metro commissioner in Portland, says the solution to Measure 37 may be more political than legal. Liberty hopes that people will realize the true impact of the measure and press for change. "The Legislature is not going to do anything unless the building is surrounded by people with pitchforks and torches." Liberty says government should reconsider generous tax breaks to farm and forest land if it's now developable. Officials should also look at capital gains and other measures to recapture "givings" — the many government up-zonings and land use decisions that dramatically increase property values for speculators. Baring legislative action, an initiative to repeal or change 37 would take almost two years to pass and so far lacks a strong backer, Liberty says. Liberty says he fears that if something isn't done soon, the state could lose it's agricultural and timber industry base to sprawling rural subdivisions. Even if people regret it later, at that point, "you've taken eggs and scrambled them, it's too late." Liberty compares Measure 37 to a stretch of unscouted class 5 river rapids. "Now we're going to run them," Liberty says. "But whether we're going to end up with the same Oregon we went into this with is unlikely." Tebbutt hopes Measure 37 won't do for Oregon's envied land use system what Measure 5 did for Oregon's once envied school system. Unless something is done, "Measure 37 is the land use equivalent of what Measure 5 did to decimate schools."        Money Protects Money Measure 37 will make a few people more rich. BY NORM MAXWELL Now that the dust has settled from the elections, Oregon and its counties and cities have to face the fallout from Measure 37, among other issues. I have been trying to understand Lane County land use for almost five years now. If there is one thing I have learned on this subject, it is that developers and their minions view state land use law and county land use policy as an interesting exercise in circumvention. A major maxim in Lane County when it comes to land use is: Anything that is not challenged is therefore legal. I know of no other legal field like this. I think a huge number of Oregon little people were duped into voting for 37 thinking that there was something in it for them. They will get to pay for the infrastructure needed by the rush of development perpetrated by the big boys but they will not be able to swiftly convert their land into cash and run away without paying huge fees to land use "consultants" with the proper connections to make it happen. Conversely, well heeled developers will seek out people who have owned farm and forest land for generations and make covert deals where the owners continue to "own" on paper while the developers' minions grease the skids down at the local land use division to convert farm and forest land into hobby farms and subdivisions in the trees for wildland firefighters to defend from fire during the hot, dry summer. Real estate in the Willamette Valley is different from real estate in, say, Wellington, Kan. We have here a continual stream of wealthy refugees from California who artificially drive the price of homes and building sites way beyond the reach of many Oregonians. This isn't happening in Wellington. A local real estate agent once explained to me that there is a continual cycle of Californians who move to the Eugene area and buy homes and pocket the difference from the sale of their row houses in the Silicon Valley. They assume that they will be able to start up an on-line business or something similar when their money runs low, only to discover that thousands of other Californians had the same idea. Eventually, they sell their Eugene real estate to the next Californian and move back home where they can get a hated "real job" and the cycle continues. Of course there are the more typical Californians who will never have to waste another day of their lives with the hated real job. The constant, artificial increase in real estate values encourage developers to push the envelop in the creation of more building sites. Anything that isn't challenged is therefore legal. If a developer can get away with creating more lots, he just hit the jackpot and runs away with a huge bag of money. Nobody is willingly noticed during this process. If you find out about it and try to challenge it, everything is "preliminary" and can't be challenged. The next step after preliminary is "final," and that can't be challenged either. If you should be able to prove that highly questionable, or even outright illegal land use procedures were used after the fact, then it is just plain "too late." To put it in a nutshell, there is a lot of money to be made by a few in the incessant drive to pave Lane County from the Cascades to the Pacific. In case you didn't know, money protects itself. There is not a dime to be made in attempting to enforce Oregon land use law or Lane land use policy. Even when you win, you lose. Lane County will not supply challengers a free staff lawyer like it will for developers. With the passage of Measure 37, a few people are going to make an incredible amount of money. Some people will make a living wage building houses in floodplain, forest and farm field for the few. We, the little people will subsidize the wealthy while being preached some variation of: "A rising tide floats all boats." Eugene, Springfield and all the surrounding towns will continue to expand while the rural residential lots will be divided and divided again. If a 10-acre RR (rural residential) lot was worth $100,000 when purchased, then the two five-acre lots created from it will each be worth at least the same apiece. When the two five acre lots are broken again, the subsequent 2.5 acre lots will still be worth a hundred grand apiece. This will continue until we can change our name to North LAne County. Perhaps then, the developers will shift their attention to Wellington, Kan.. Norm Maxwell is chairman of Lane County LandWatch and lives on Fire Road in Lorane.
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