Moving Boundaries in the Modern Age: The Oregon Supreme Court Weighs in on Accretion

Oregon Coast beach sandIf, as expected, climate change and sea level rise become a bigger threat to private property in the 21st century, ancient doctrines about boundary changes, including accretion, reliction and avulsion will become increasingly important.  On August 14, 2014, the Oregon Supreme Court explained its view of accretion in Sea River Properties, LLC v. Parks, 355 Or 831 (2014).

The case arose just north of Rockaway Beach along the Nehalem River and involved grants of land that went back over a century and a half.  There was a complex geologic and factual background, but the question the court had to answer was who owned land that had generally built up west of the defendant’s land and north of the plaintiff’s land between the old bed of the Nehalem river (before the federal government built a jetty) and the ocean.  The Oregon Supreme Court chose not to exercise its ability to re-weigh the facts and, relying on the facts found by the trial court, concluded that “accreted land belongs to the upland owner where the accretion began,” even if it eventually grows in front of the property of another.

In itself, this case is not particularly surprising or interesting, but, as climate change continues to affect our world, these cases will only become more common and it behooves practitioners to understand the application of the common law property doctrines involved in shifting boundary lines.

The Old House gets New Life: LUBA Says Only the Initial Objector May Remove an Historic Property Designation

carrie_richterLast week in the case Lake Oswego Preservation Society v. City of Lake Oswego, LUBA gave a huge boost to the historic preservation community and the protection of local historic resources.  ORS 197.772 is one of the few statutes regulating how local governments designate and protect historic resources.  ORS 197.772(1) provides that where a property owner objects to any form of historic property designation, the local government must remove the designation.  Subsection (3) of the same statute requires that the local government “allow a property owner” to remove a historic designation that was previously “imposed by the local government.”  LUBA was asked to decide whether the term “property owner” is limited to the owner at the time that the designation was imposed or whether a person who becomes an owner after the designation was imposed, where the original owner objected to the designation, could also seek removal.

In 1990, the City of Lake Oswego designated the Carmen House, a historic farmhouse and barn, along with a number of other properties within the City’s historic landmark inventory.  The property owners at the time, Wilmot and Gregg filed an objection to the designation.  While the City’s decision was pending review before LUBA, a fire on the property destroyed the barn.  The City’s decision was withdrawn for reconsideration and as a result, the Carmen House was designated without the additional acreage and without further objection.  The Mary Caldwell Wilmot Trust, the current owner of the property, sought to remove the Carman House’s historic designation under ORS 197.772(3).  The City Council granted the request to remove the historic designation concluding that the term “property owner” is not limited to the owner at the time the property was designated.  The neighbors appealed that decision to LUBA.

LUBA began its analysis by focusing on the text and context of ORS 197.772(3).  LUBA found the text of the provision not terribly helpful because adding a phrase to limit qualifying property owners to those who made the initial objection would insert language into the provision just as including post-designation subsequent purchasers would also insert language, contrary to a law governing statutory construction.  Moving to the context, LUBA found the use of the same phrase, “a property owner” in both subsection (1) and (3) of the statute suggests that the two phrases have the same meaning and refer to the initial objecting property owner.  However, LUBA also noted that these two provisions have “different, non-overlapping circumstances that occur at different times,” suggesting an intent to describe different owners because the two categories are “mutually exclusive.”

What tipped the scales for LUBA was legislative history indicating that the purpose of subsection (3) was to allow property owners who “have been coerced into the historic property designation” to petition for removal.  When one of the legislators was asked whether a person who bought a piece of property that had a historic designation could seek to remove it, the response was “[w]e haven’t thought about that situation.”  A proposed amendment was offered that in cases where a local government designation occurs with concurrence from the local government, the obligation “runs with the land.”  LUBA found that “taken together,” subsection (3) and the proposed amendment would treat subsequent owners the same as the original owner.  If the designation was imposed over an objection, then a subsequent owner could request removal and conversely, if the initial owner consented, the subsequent property owner could not request removal.   This “run with the land” amendment was removed before final adoption.  Without any discussion explaining why the amendment was deleted, LUBA concluded that elimination of the additional language that would have put “subsequent owners on the same footing as the property owner” provides the “strongest inference” that the legislature did not intend this result.  From this analysis, LUBA concluded that, although it is “a close question,” the legislature did not intend for the term “property owner” to include person who become owners of property after it is designated and the City erred in removing the designation based on ORS 197.772(3).

LUBA’s decision went on to find that a property owner’s failure to continually raise the objection through later stages of a proceeding does not mean that the owner withdrew the objection or implicitly consented to the designation.  LUBA found that although Wilmot did not object to the subsequent designation of just the Carman House, Wilmot did not withdraw his previous objections.

LUBA’s decision makes sense from a policy perspective.  Once a historic inventory designation is in place, subsequent buyers, who are presumably aware of the designation, should be assumed to have bought the designation along with all of the obligations that come with it.  Removal of the designation is still possible through Goal 5 and its implementing rules, but not through an end-run, relying on the limited objection of a previous owner who subsequently elected not to pursue such a course.  After all, the value of a historic resource and its overall contribution to a community does not lessen when contemporary development pressures create incentives to develop that may have not existed when a resource is designated.

In a land use scheme that many argue is overly complicated and convoluted, it is interesting to note that historic preservation has very little, arguably a single relatively clear statutory standard, governing the protection has resulted in this case that will have a demonstrable impact on preservation efforts throughout the state.  The first of these cases, Demlow v. City of Hillsboro, LUBA narrowed the removal exception to those cases where the historic designation was “imposed on the property”.  Now, LUBA has narrowed the exception further to the current owners that object.  This is a narrow exception indeed.  Now we will wait to see if the Court of Appeals is asked to review or if the legislature decides to enlarge or alter the standard.

Note:  This firm represents the City of Lake Oswego in some limited matters unrelated to this case.

Garvey Schubert Barer Land Use Attorney Edward J. Sullivan is Honored with a Lifetime Achievement Award

Ed Sullivan accepting his awardThe American Bar Association State and Local Government Section has honored Edward J. Sullivan with the Jefferson Fordham Lifetime Achievement Award.

Ed Sullivan’s distinguished legal career spans 45 years and has had significant impact on Land Use law in Oregon. Throughout his career, he has championed sound land use planning, the provision of affordable housing opportunities, and the protection and preservation of resource lands throughout Oregon and beyond.

Carrie Richter, co-chair of the Garvey Schubert Barer Land Use Group with Ed Sullivan, and his colleague for the past 10 years, said, “Ed’s accomplishments speak for themselves. He has shaped the Oregon land use system, starting with his influence on the seminal Senate Bill 100 drafting and adoption, taken land use battles to the United States Supreme Court, and proposed innovative approaches to ensure that sufficient urban land is available for affordable housing development.”

Ed Sullivan’s accomplishments have included work with major landmark cases in the history of Oregon State Land Use Law. The most notable cases that Ed has been involved in are Fasano v. Washington County Board of County Commissioners, and Baker v. City of Milwaukie. Both are Oregon Supreme Court cases that uphold the necessity to guarantee fair, reviewable and predictable decision-making in Oregon land use.

Before entering private practice, Ed worked for the then governor of the State of Oregon, Robert W. Straub.

According to Dwight H. Merriam, FAICP, attorney with the Hartford, Connecticut-based law firm, Robinson & Cole, “Ed has represented developers, property owners, governments, individuals, and many advocacy groups. His writings, teaching and lecturing reflect his synoptic and inclusive view of what land-use law and the Rule of Law mean for all stakeholders, and importantly, for those who are disenfranchised in the decision-making process, and for generations not yet born.”

Within the land use law community, education regarding comprehensive and coordinated land use planning is of the utmost importance. Over the past 25 years, Ed has taught land use planning law to planners and law students at Lewis and Clark Law School, Willamette University College of Law, and Portland State University. He speaks on a variety of land use planning topics all over the world. His most recent presentations include a discussion of urban grown boundaries at the Planning Law and Property Rights conference in Israel, as well as speaking engagements in Athens, Greece and Sydney, Australia.

Ben Griffith, Attorney with the Cleveland, Mississippi-based law firm, Griffith & Griffith, noted that “Ed has generously given his time, expertise and desire to advance and improve this vital component of the rule of law, through participation in scores of international conferences and symposia from the Pacific Rim, The Peoples Republic of China, and Australia to Eurasia, Eastern and Central Europe, the nations comprising the European Union and beyond. A born educator, advocate and counselor, Ed has inspired a younger generation of land use specialists to take on the mantle of public advocacy and public sector leadership, while maintaining a balanced perspective that is evidenced in his law firm, countless community contributions and personal friendships that span the globe.”

Ed Sullivan has published hundreds of articles and commentaries in everything from academic journals and legal industry trade publications, such as the Urban Lawyer, to many newspapers and community newsletters. His publications include a series of articles tracking the history of land use values in Oregon, which are encyclopedic in depth and cover experiential-based explanations of efforts to preserve farmlands, forest lands, and to still provide public infrastructure. He also tracks, and annually publishes an article exploring the role that the comprehensive plan plays in governing local government decisions for the American Bar Association. Due to the combination of his law practice, his teaching and many publications, Ed Sullivan is widely held to be an expert in his field, and is often the first person lawyers and planners rely on for counsel.

For over four decades, Ed Sullivan has dedicated himself to the Oregon State Bar and has served as the editor of the Oregon State Bar Land Use publication. He has also served as an associate editor of the Real Estate and Land Use Digest, the bi-monthly summary of land use cases and other real estate and land use developments for the Oregon State Bar. His many accomplish-ments include advocating for affordable and disabled housing; he founded, and is the past chair of, the Housing Land Advocates, dedicated to ensuring that land is available for the construction of affordable housing

Long known to be a mentor to law students, an educator to the legal community and to the public, he has been an advocate to many and has dedicated his career to serving the community with the highest standards of professionalism, integrity and commitment.

Patricia E. Salkin, Dean of Touro College’s Jacob D. Fuchsberg Law Center, said, “On a more personal level, throughout his career Ed has been a gracious mentor. As a long-time leader within the ABA State and Local Government Law Section, Ed has encouraged and supported my active involvement. He has brought other young lawyers – men and women – into the State and Local Section, and as a result, he is responsible in part for a healthy, sustainable future of the State and Local Government Law Section. Ed is a busy family man, a focused and successful lawyer, and an inquisitive person who has done much to advance the field of state and local government law. I can think of no one more deserving of the Jefferson Fordham Lifetime Achievement Award than Edward J. Sullivan.”

Jennifer Bragar, Ed’s colleague at Garvey Schubert Barer, said, “Ed Sullivan’s professional life has so overlapped with his personal commitment to excellence and public service that even this award fails to capture the magical quality and love of the law he bestows on those he works with, collaborates with and teaches.”

Ed Sullivan has touched the lives of so many and yet he attributes much of the support he gets from his family, his wife Patte, his four children and seven grandchildren.

http://www.prweb.com/releases/2014/08/prweb12088067.htm

NEW YORK APPELLATE COURT AFFIRMS SLAPP SUIT DISMISSAL AND ATTORNEY FEE AWARD

new york map magnifiedSouthampton Day Camp Realty, LLC v. Gormon, 2014 WL 2871806 (App. Div., NY) involved the appeal of a decision by the Chief Building Inspector of the Town of Southampton that a nonconforming tennis and racquet club could be converted into a children’s day camp without a variance.  Defendants were neighbors who opposed that conversion without a variance and appealed the Chief Inspector’s decision to the Board of Zoning appeals.  Defendants also distributed a flyer which suggested that Plaintiffs did not care about the environmental effects of the conversion and had lied to town officials.  Plaintiffs then sued Defendants for defamation.  Defendants moved to dismiss the suit, contending that the action constituted a Strategic Lawsuit Against Public Participation (“SLAPP”) suit and sought dismissal, attorneys’ fees and punitive damages.  Before discovery, Defendants moved for summary judgment on their complaint and the counterclaim.  The Trial Court dismissed the complaint and awarded attorneys’ fees, but denied Defendant’s request for punitive damages.  Both parties appealed.

The Appellate Division noted that New York’s SLAPP Suit litigation entitles a qualified defendant to dismissal, as well as attorneys’ fees and costs.  A plaintiff must demonstrate that the lawsuit has a “substantial basis in fact and law or is supported by a substantial argument for an extension, modification or reversal of existing law.”  Defendants demonstrated that Plaintiffs were permit applicants and their communication was “materially related” to their efforts to report or comment upon, or oppose, this application and the communication was part of an effort to garner support for their opposition.

The Appellate Division ag

NEW YORK APPELLATE COURT LIMITS TRANSFERRABLE DEVELOPMENT RIGHT CREDITS

new york map magnifiedTuccio v. Central Pine Barrens Joint Planning & Policy Commission, 113 A.D.3d 693, 978 N.Y.S.2d 350 (2014) involved a declaratory judgment proceeding in which the Petitioner contested an award of 18.46 Pine Barrens Credits to his property, instead seeking 50.42 Pine Barrens Credits and appealing from the dismissal of the proceedings in the lower court.  The Pine Barrens Credits program allocates transferable development rights to owners of property located within the “core preservation area” of the Central Pine Barrens in Long Island under the Long Island Pine Barrens Protection Act (the “Act”).

Initially, the Pine Barrens Commission denied Petitioners’ request for any Pine Barrens Credits, finding that there was no justification for any credits under the Act.  Petitioners then brought a declaratory judgment proceeding seeking the 50.42 Pine Barrens Credits asserted to be owed under the Act.  In the first iteration of this case, the Appellate Court determined there was no clear legal right to the 50.42 Pine Barrens Credits but there were other factors in the allocation formula so that some credits were available.  On remand, the Commission determined that only 20% of the property could have been developed under the local zoning code and, acting as the clearinghouse, the Commission determined that 18.46 Pine Barrens Credits should be allocated.  Petitioner again sought declaratory relief but the trial court denied relief and petitioner again appealed from the dismissal of their declaratory judgment petition.

The Court determined that the law of the case doctrine precluded a request for the 50.42 Pine Barrens Credits and that the Commission acted consistently with the appellate court directive and thus affirmed the Commission’s decision.  Implicitly, the appellate court agreed that the amount of the credits was related to the intensity of allowable development.

This case presents another aspect of the “law of the case” doctrine and also appears to limit transferrable development rights solely to compensate a land owner for actual, rather than speculative, lost development opportunities.

Tuccio v. Central Pine Barrens Joint Planning & Policy Commission, 113 A.D.3d 693, 978 N.Y.S.2d 350 (2014).

UNITED STATES SUPREME COURT TO REVIEW NINTH CIRCUIT SIGN CASE

Ed Sullivan Reed v. Gilbert, 707 F.3d 1057 (9th Cir., 2013), Cert. Granted (July 1, 2014), involved the validity and constitutionality of Defendant Town of Gilbert’s sign regulations as applied to temporary directional signs for church services in an adjacent town.  The instant decision involved an appeal from a Trial Court decision on remand from the Ninth Circuit in which that Court found the temporary sign regulations not to be content-based, but rather a reasonable time, place and manner regulation.  However, the Ninth Circuit also remanded the case to the Trial Court to determine whether the claim that the First Amendment and the Equal Protection Clause are violated if the regulations favor some noncommercial speech over other noncommercial speech.  On remand, the Trial Court found no such violation and the Plaintiff church and its pastor again appealed.  In the meantime, Defendant amended its sign regulations, but the Ninth Circuit observed that those amendments could be challenged by Plaintiffs in separate proceedings.

Plaintiffs asserted  they were under a religious injunction to convert others and to invite them to their services, which they did, inter alia through these temporary directional signs.  There was friction with the Defendant Town, especially because the church services were held in an adjacent town.  Defendants’ sign code required a permit for signs but exempted three categories from these requirements – temporary directional signs of a certain size and placement, which are allowed only twelve hours before and one hour after the event that they advertise; political signs dealing with a candidate or ballot measure placed at any time before and within up to ten days after election on that candidate or ballot measure; and ideological signs which are not limited as to time or number.  Directional signs have the least amount of allowed area, while ideological signs have the most.

The Ninth Circuit in 2009 affirmed the original Trial Court decision, determining that the case involved an applied challenge, that the sign code was not content-based (as the directional aspects dealt with speakers or events rather than the content of the speech involved), that the ordinance was not unconstitutional because of the limited duration categories, that the ordinance was narrowly tailored to advance the town’s interests in traffic safety and aesthetics, and that alternative channels of communication were available.  Additionally, the Court found that commercial speech was not favored over noncommercial speech.

On remand, the Trial Court considered cross-motions for summary judgment to consider the remanded constitutional issues and again dismissed Plaintiffs’ claims.  The Court distinguished among the three noncommercial exemptions and found the distinctions not to be prohibited content-based regulations, and did not favor one type of noncommercial speech over another.  Thus, the Trial Court found it permissible to have differing durational and size requirements for each of the three noncommercial categories.

On review, the Ninth Circuit said it was bound by the “law of the case,” and as there was no new discovery or any asserted evidentiary facts in the second iteration of the case, the sole basis for the remand was whether the distinctions among the three noncommercial categories constituted discrimination that violated the First Amendment or the Equal Protection Clause.

The Ninth Circuit noted the evolution of jurisprudence relating noncommercial speech beginning with the prohibitions on favoring commercial over noncommercial speech in Metromedia, Inc. v. San Diego, 453 U.S. 490, 541 (1981).  While the United States Supreme Court had not directly dealt with this issue since Metromedia, the Ninth Circuit has not been so fortunate.  In G.K. Ltd. Travel v. City of Lake Oswego, 436 F.3d 1064 (9th Cir. 2006) that court found that neither reference to a speaker nor event involved content discrimination as enforcement officers were not required to read the sign to determine whether the sign were exempt.  The Court said the question in this case was whether the differing requirements for each of the three categories of noncommercial speech could be justified without reference to the content of that speech.  The Ninth Circuit responded that it had considered, and rejected, a similar argument in the first iteration of this case adding:

* * *[T]he distinctions between Temporary Directional Signs, Ideological Signs, and Political Signs are content-neutral.  That is to say, each classification and its restrictions are based on objective factors relevant to Gilbert’s creation of the specific exemption from the permit requirement and do not otherwise consider the substance of the sign.  The Political Signs exemption responds to the need for communication about elections. The Ideological Sign exemption recognized that an individual’s right to express his or her opinion is at the core of the First Amendment.  The Temporary Directional Sign exemption allows the sponsor of an event to put up temporary directional signs immediately before the event.  Each exemption is based on objective criteria and none draws distinctions based on the particular content of the sign.  It makes no difference which candidate is supported, who sponsors the event, or what ideological perspective is asserted.  Accordingly, as the speaker and event determinations are generally “content neutral.”  Gilbert’s different exemptions for different types of noncommercial speech are not prohibited by the Constitution. (Footnote omitted)

Moreover, the Ninth Circuit found a similar approach had been validated in Hill v. Colorado, 530 U.S. 703 (2000) where a regulation of speech-regulated conduct within 100 feet of a healthcare facility was upheld as it did not regulate the content of any speech.  Neither was there such a regulation of the content of temporary directional signs in this case.  In Hill, the United States Supreme Court found no regulation of speech content, but only where that speech may be exercised, noting the state interest in protecting access and privacy and a need to provide police with clear guidelines.  The United States Supreme Court also added it was not improper to review the content of speech to determine whether a rule of law applied to a course of conduct.

With regard to the differential treatment of the categories of noncommercial speech, the Ninth Circuit reasoned that the temporary directional sign regulations were, standing alone, content-neutral and not in competition with the other noncommercial categories; moreover, those regulations reasonable with respect to their purposes.

The Ninth Circuit, having found the ordinance to be content-neutral, and to be a reasonable time, place and manner restriction, turned to the issues of whether the ordinance was narrowly tailored to serve a significant governmental interest and left open ample alternative channels of communication.  The Court recognized traffic safety and aesthetics as significant governmental interests and found the temporary directional signs (unlike political and ideological signs) were properly prohibited from being placed in the right-of-way.  Moreover, those signs were not of such core speech importance to be protected as it would be in the other categories which were allowed to be placed in the right-of-way.  As noted, there was no competition among the various commercial categories and no showing that the restrictions on temporary directional signs interfered with their purpose of showing would-be patrons the way to church services.  Moreover, the Court said it would defer to local judgments on sign size and duration, if they be reasonable.  These considerations responded adequately to the obligations of the local government under the First Amendment.  The Court concluded with the regulations need not be uniform among all categories of noncommercial speech and may vary with the type of speech involved and how the town’s interests are affected.  The Court concluded:

* * *In sum, (a) Gilbert was not required to create an exemption for Temporary Direction Signs, (b) the restrictions on directional signs are rationally related to the purpose of the directional signs, and (c) the restrictions are reasonably designed to promote Gilbert’s interests in aesthetics and safety.

Moreover, the Ninth Circuit found a “reasonable fit” between the public agency ends and the regulatory means chosen to reach those ends.  As to alternative channels of communication, the Ninth Circuit was satisfied that Plaintiffs may erect multiple temporary signs in the area and take advantage of other means of communication.

The Ninth Circuit also rejected Plaintiffs’ challenges to the ordinance under the Arizona Free Exercise of Religion Act, vagueness and overbreadth, and equal protection grounds.  However as noted, the Court allowed for new litigation to deal with amendments to the Defendants’ sign code made since the Trial Court’s second decision.

The gist of this decision is that all noncommercial speech exemptions need not be treated alike, so long as each of the exemptions in content-neutral, narrowly tailored to serve a significant governmental interest, and leaves open ample alternative channels of communication.

Judge Watford dissented, although he agreed that the post-trial ordinance amendments could be challenged in a separate suit.  Judge Watford pointed out that the first Ninth Circuit decision considered the temporary directional sign provisions in isolation and found it content-neutral.  However, that decision did not evaluate the relationship of that exemption with the political or ideological sign categories; rather the Ninth Circuit remanded the matter to the Trial Court to undertake an analysis of whether favoring one type of noncommercial speech over another was constitutional.  It was clear to the dissent that the terms for the three exemptions were different in terms of sign size and duration and that fact lead the dissent to believe that one type of noncommercial speech was unconstitutionally treated more favorably then another.  The dissent noted that in a public forum, unless a distinction were based upon some non-communicative aspect of the speech involved, the regulation must fall concluding:

* * *The reason is simple: Within the realm of noncommercial speech, the government may not decide that speech on certain subjects is more (or less) valuable—and therefore more (or less) deserving of First Amendment protection—than speech on other subjects.

The dissent described one reason for the invalidity of the sign code in Metromedia’s plurality opinion is that that ordinance valued certain noncommercial speech (i.e., political signs) over other noncommercial messages, thus concluding:

Gilbert’s sign ordinance violates the First and Fourteenth Amendments by drawing content-based distinctions among different categories of non-commercial speech.  The most glaring illustration is the ordinance’s favorable treatment of “political” and “ideological” signs relative to the treatment accorded the non-commercial signs plaintiffs seek to display.  Under the ordinance, plaintiffs’ temporary directional signs may not exceed six square feet in size and may not be displayed more than 12 hours before or one hour after the relevant event—here, Sunday morning church services.  (Given the 9:00 a.m. start time of Good News’s church services, this durational restriction limits the display of plaintiffs’ signs to periods when it is virtually always dark.)  In contrast, “political” signs—defined as “[a] temporary sign which supports candidates for office or urges action on any other matter on the ballot of primary, general and special elections relating to any national, state or local election”—may be up to 32 square feet in size and may be displayed any time prior to an election and removed within 10 days after the election.  “Ideological” signs—defined as “a sign communicating a message or ideas for non-commercial purposes”: that is not a constriction, directional, political, or garage sale sign—may be up to 20 square feet in size and are not subject to any durational limits at all.[1]* * *

The United States Supreme Court has granted certiorari in this case and the matter should be heard before the end of the year and decided before June, 2015.

This case presents a very interesting question of whether the First Amendment allows for differentiation and regulations among noncommercial speech.  Perhaps in this case the Supreme Court will clear up the plethora of inconsistent authorities in dealing with First Amendment regulations.

Reed v. Gilbert, 707 F.3d 1057 (9th Cir., 2013)


[1] In October 2011, Gilbert amended the Sign Code to allow placement of Temporary Directional Signs within the public right-of-way

NORTH CAROLINA APPEALS COURT AFFIRMS REVERSAL OF CONDITIONAL USE PERMIT APPROVAL ON RES JUDICATA AND COLLATERAL ESTOPPEL GROUNDS

Wireless TowerMount Ulla Historical Preservation Society, Inc. v. Rowan County, 2014 WL 619584 (NC. App.) involved the second attempt of a broadcast company secure a conditional use permit to build a radio tower.  The first application had been denied in 2005 on grounds of an air safety hazard to a nearby airport.  That denial had been appealed to the North Carolina Court of Appeals but was upheld.  In 2010, a slightly lower tower was proposed and approved after the governing body denied a motion to dismiss the application on res judicata and collateral estoppel grounds.  The trial court reversed and the Historical Society appealed.

The Court characterized conditional use permit conditions as quasi-judicial and asserted that the trial court decision on this question of law was subject to de novo review.  Utilizing North Carolina case law, the Court found that res judicata and collateral estoppels could apply to parties in privity if the facts have not materially changed as to the grounds of the previous denial.  In this case, the 2005 denial was due to an air safety hazard and the question was whether a reduction of height by 150-feet of the tower, which was now proposed to 1,200 feet high, was a material change.  The Court characterized this as a fact question to which the Court normally deferred to the governing body.  However, the Court, in viewing the whole record, found there was nothing that would materially undermine the reasoning of the 2005 decision.  The Court said the Respondent essentially had the same facts in both cases and failed to show that the 2005 decision was incorrectly decided based on new facts.  Lacking such a basis, the doctrines of res judicata and collateral estoppel applied and the grant of the conditional use permit was found to be correctly reversed by the Trial Court.

Oregon courts in LUBA have been reluctant to apply res judicata and collateral estoppel to quasi-judicial land use decisions.  Plans and regulations, as well as facts, change over time and the identity of parties in two cases is rarely the same.  However, this North Carolina decision, which turns on whether facts have been materially changed, is an interesting excursion into this area of law. Mount Ulla Historical Preservation Society, Inc. v. Rowan County, 2014 WL 619584 (NC. App.)

AFFIRMATIVELY FURTHERING FAIR HOUSING: A NEW RULE IN TOWN

Affordable_Housing_Clackamas_CountyLast September, the comment period on a federal Department of Housing and Urban Development’s (“HUD”) proposed rule closed. That rule portends a very different course in the expectations of state and local governments in dealing with affordable housing.  While retaining the prohibitions on housing discrimination, the new rule (now being reviewed by the Office of Management and Budget) requires taking proactive steps “to address significant disparities in access to community assets, to overcome segregated living patterns and support and promote integrated communities, to end racially and ethnically concentrated areas of poverty, and to foster and maintain compliance with civil rights and fair housing laws.”

Most local governments take federal funds for housing or urban development, which implicates the new rules.  Those funds take the form of loan guarantees, urban renewal grants, homelessness programs, disaster relief, transportation and other infrastructure funds and a variety of other means.  A state or local grantee is “required to submit a certification that it will affirmatively further fair housing (“AFFH”), which means that it will (1) conduct an analysis to identify impediments to fair housing choice within the jurisdiction; (2) take appropriate actions to overcome the effects of any impediments identified through that analysis; and (3) maintain records reflecting the analysis and actions in this regard.”  The AFFH obligation extends to all housing and housing-related activities in the grantee’s jurisdictional area whether publicly or privately funded.

One effect of the new rule, which is likely to be challenged in the federal courts, is that housing issues will not be treated in isolation, but in a relationship with other drivers of urban development.  Thus, the connections between affordable housing and transportation or zoning, community expenditures in public services and facilities, racial or ethnic segregation and residency preferences or requirements are relevant issues for analysis and action.

Potentially, the new rule is not another effort at paper shuffling to deal with housing needs.  Receipt of federal housing funds requires repeated AFFH certifications of compliance with the analysis, action and records obligations noted above.  The rule requires action to deal with problems identified, in part, by the use of uniform data.  A state or local government may thus be sued for doing nothing in the face of an identified problem.  Moreover, for those public agencies that certify compliance and do nothing or which support efforts to thwart affordable housing, litigation may be brought under the False Claims Act and if the AFFH certifications were false, treble damages and attorney fees may be awarded, with a possible share going to a “relator,” one who “blows the whistle” on a non-complying government.

The case of Westchester County, New York, even though brought under current law, is instructive.  Although certifying that it was affirmatively furthering fair housing when it received over $52 million in federal grants over the years, the County did not consider race-based impediments to fair housing choice even though it was part of one of the most segregated regions in the country.  The County made no mention of housing discrimination or residential segregation and was successfully sued by a nonprofit activist organization under the False Claims Act.  The federal government joined the suit and a settlement was ultimately reached under which 750 affordable housing units must be built within 7 years in the “whitest” neighborhoods of the County, the County must return $30 million to HUD because of its false certifications, $21.6 million of which was to Fund Integrative Units (which was supplemented by another $30 million from the County), which was also required to pay $7.5 million to the “Relator” for ferreting out false claims and another $2.5 million in attorney fees and costs.  While the racial overtones of the County’s actions were extreme, the new rule raises the bar for reporting, actions and records required of state and local governments in housing matters.

Because the new rule does not depend on federal funding for enforcement, it is likely that nonprofit affordable housing organizations will follow the lead of their environmental brethren to undertake enforcement activity, using the “bounty” provided by the False Claims and Civil Rights Acts to fund further enforcement.  If the rule is enacted and survives OMB review and court challenges, the national housing picture will be very much changed indeed.  In Oregon, the new rule may spell the end on the statutory provision against inclusionary zoning and Metro’s prohibition on forcing higher densities in existing neighborhoods.  We all may be in for a very bumpy ride indeed.

 

Fair Housing Violations Bring Steep Penalties

HUD housing and urban developmentOn June 10, 2014, the City of San Jacinto, in Riverside County, California, entered into a consent decree with the Department of Housing and Urban Development (HUD) to resolve a lawsuit alleging disability discrimination under the Fair Housing Act (FHA) and Americans with Disabilities Act (ADA).  The City agreed to change its land use laws governing group home living, and to pay a total of $746,599 in compensatory damages to housing providers and former residents with disabilities, as well as a $10,000 civil penalty to the United States.  The damages also include private plaintiffs’ attorneys’ fees and costs.

The settlement marks an end to an almost two-year-old complaint, but a six–year-old battle, where private group home operators claimed the City enacted an ordinance intended to exclude unlicensed and some licensed homes for persons with disabilities, and by targeting homes for persons with disabilities for enforcement of the ordinance and other local laws.

On October 3, 2008, the City Council amended the San Jacinto Zoning Code (the “Zoning Code”) by approving Ordinance 08-14 (the “ordinance”), which was passed by unanimous vote of the council.  The ordinance amended the Zoning Code’s definition of “Group Home” or “Group Housing” to “[a] residence or dwelling, other than a hotel, wherein two (2) or more rooms, with or without individual cooking facilities, are rented to individuals under separate rental agreements or leases, either written or oral, whether or not an owner, agent, or rental manager is in residence, in order to preserve the residential character of the neighborhood.”  The ordinance specifically exempted certain state-licensed congregate living facilities, such as “community care facilities,” from its definition of “group homes,” making those with six or fewer residents permitted uses in residential zones.

Prior to and after the City’s enactment of the ordinance, the city’s zoning code defined “family” as “an individual or two (2) or more persons related by blood, marriage or legal adoption, or a group of not more than 6 persons who are not related, living together as a single house-keeping unit in a dwelling unit.”

In conjunction with the passage of the ordinance, the City’s code enforcement officers, including uniformed officers of the County Sherriff’s Department, investigated group homes. These actions included intrusive and direct questioning of residents about whether they were on parole, on medication and/or recovering from addiction.  After these investigations, the City continued to cite providers of group homes for persons with disabilities for illegal operation of a group home in a residential zone.

Thereafter, the City allowed for a reasonable accommodation process to consider placing group homes in residential neighborhoods, but its proposed conditions were not acceptable to group home providers and they filed a complaint.

HUD’s investigation led to findings that the City had, in fact, discriminated against people with disabilities under the FHA and ADA.  The consent decree provides the following injunctive relief:

  • The City shall not impose restrictions on housing for persons with disabilities not imposed on housing for an equal or greater number of persons without disabilities.  Actions prohibited include, but are not limited to, the imposition, through any provision or practice, of numerical occupancy limits on group housing for unrelated persons with disabilities that is more restrictive than numerical occupancy limits for families or other unrelated persons.
  • The City was required to adopt new ordinances to establish a new zoning classification, “Group Homes for Persons with Disabilities,” and amend the City’s reasonable accommodation procedure.
  • The City is required to maintain records of all oral and written requests for reasonable accommodation or modification and the City’s responses thereto for a period of three (3) years following the date of the request and the group home’s response, as applicable.
  • The City shall not impose any additional fees, costs, or otherwise retaliate against any person who has exercised his or her right under the FHA or ADA to make one or more requests for reasonable accommodation or modification.
  • Immediately upon entry of the consent decree, the City shall cease any efforts to close or bring other enforcement actions against housing for persons with disabilities operated in accordance with the FHA and the ADA, including but not limited to, homes for persons with disabilities operated by the complainants (City by Aurora Beltran and Rajeeyah Bilal-Vamey located at 325 East Third Street and 1835 Rogers Way, respectively), so long as these homes continue to operate in compliance with all laws.
  • The City is required to appoint a Fair Housing Compliance Officer, and City staff, City Council members, Planning Commissioners, and the Sherriff’s officers are required to undergo fair housing training.

HUD’s investigations of fair housing violations are taking an expensive toll on local governments.  If you advise a city that is considering restrictive zoning; or differential treatment of the number of family members as compared to the number of unrelated people with disabilities that can live together in the same zone, then consider the San Jacinto consent decree as a warning to take such actions cautiously.  If the ordinance ultimately results in unfair treatment to group home providers, then do not be surprised if fair housing advocates complain to HUD.

 

CITY’S “UTILITY FEE” IS A TAX AND THUS INVALID WITHOUT A VOTE SAYS MICHIGAN APPELLATE COURT

Michigan road signCounty of Jackson vs. City of Jackson, 2013 WL 3957695 (Mich. App.) involved defendant’s attempt to raise revenue for certain city services such as street sweeping, catch basin cleaning, leaf pickup, and mulching by a storm water management utility charge on all property owners.  The Headlee Amendment to the Michigan Constitution prohibited imposition of a tax on property without an affirmative popular vote.  Before the imposition of the utility charge, the city had funded its obligations under the federal Clean Water Act through property and gas taxes from the general fund and road fund, respectively, as well as certain surcharges on water and sewer bills.  By ordinance, the city created a storm water utility to manage surface and storm water through an annual charge imposed on all property, whether developed or not, in the city and limiting the revenue derived from the charge to storm water facility construction operation and maintenance.  The charge was computed based on an estimate of storm water runoff from each parcel which charge considered whether the surface is all or partially impervious (although it had a uniform charge on small, single family residential lots).  The ordinance also provided for various credits for reducing the amount of storm water and surface water discharge, provided for administrative appeals in the computation of charges, and allowed for enforcement through civil actions, discontinuation of water service and the like.  Plaintiff local government and various private entities brought an action for declaratory, and for monetary and injunctive relief against the ordinance.

The Court found that plaintiffs bore the burden of proof to show the ordinance was invalid or unconstitutional and required plaintiffs to show that the fee was a “tax,” and thus not permitted without a popular vote.  In Bolt v. City of Lansing, 221 Mich App 79, 561 NW2d 423 (1997), a similar scheme was found invalid by the Michigan Supreme Court, which used a 3-factor analysis to distinguish a fee from a tax, i.e.: (1.) a fee serves a regulatory purpose; (2.) a fee is proportional to services rendered; and 3. a fee is voluntary.  Neither of the first two factors were met, especially as two-thirds of parcels in the city already had a separated sewer and storm water system which those owners had already paid for through general taxes or individual assessments.  The Bolt ordinance failed to distinguish between charges based on services provided as to the relationship between the charges and benefits conferred.  Moreover, the ordinance in that case and this, while relating to rainfall on a parcel, did not deal with the treatment of pollutants from which parcels discharge into navigable waters.  Finally, the fees in both cases were neither voluntary nor avoidable.  Also important in Bolt were the following: (1.) the fee revenues were to be used on projects which had been financed by the general fund; (2.) the indebtedness from the fee could be secured by a lien; and (3.) the fee was sent along with property tax statements.

The Bolt court concluded:

We conclude that the storm water service charge imposed by Ordinance 925 is a tax and not a valid user fee.  To conclude otherwise would permit municipalities to supplement existing revenues by redefining various government activities as “services” and enacting a myriad of “fees” for those services.  To permit such a course of action would effectively abrogate the constitutional limitations on taxation and public spending imposed by the Headlee Amendment, a constitutional provision ratified by the people of this state.  In fact, the imposition of mandatory “user fees’ by local units of government has been characterized as one of the most frequent abridgments “of the spirit, if not the letter,” of the amendment.

The danger to the taxpayer of this burgeoning phenomenon [the imposition of mandatory user fees] is as clear as are its attractions to local units of government.  The “mandatory user fee” has all the compulsory attributes of a tax, in that it must be paid by law without regard to the usage of a service, and becomes a tax lien of the property.  However, it escapes the constitutional protections afforded voters for taxes.  It can be increased any time, without limit.  This is precisely the sort of abuse from which the Headlee Amendment was intended to protect taxpayers.  [Headlee Blue Ribbon Commission Report, supra, § 5, pp-26-27.] [Bolt, 459 Mich at 169.]

Turning to the case at hand, the Court found the fee served a dual purpose – financing treatment of solid pollutants in storm and surface water runoff, as well as supplementing general revenue-raising efforts by shifting funding of those activities already provided from the city’s general and street funds to a charge-based system that augments the city’s general fund.  The Court concluded that the “minimal” regulatory purpose was far outweighed by its revenue-raising features.  In fact, there was no effective regulation of discharge from an individual parcel (aside from the ordinance’s credit scheme).  The background of the challenged ordinance shows its primary rationale was revenue raising and thus violates Bolt by allowing the city to supplement its existing revenue streams by redefining a governmental activity as a “service” for which a user fee may be charged.  Moreover, there was no relationship or proportionality between the service and the fee – rather the charge resulted in a benefit to the general public.  While larger parcels were more susceptible to proportionality under the city’s fee schedule, the bulk of parcels in the city (83%) were single family residential lots for which a uniform single charge was imposed.  Finally, the ordinance in this case, as in Bolt, was compulsory and effectively enforced through various means.  Given these attributes, the ordinance was deemed to be a tax and thus invalid without a popular vote.

This case deals with the details of property tax limitation measures, which differ from state to state.  As a matter of logic, the case makes a great deal of sense and distinguishes fees from taxes. County of Jackson vs. City of Jackson 2013 WL 3957695 (Mich App).

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