Big News Day

Yesterday three fairly weighty news items came down the pike. 

1.  Hardy Myers' opinion that Measure 37 claims aren't transferable

The state attorney general issued an opinion Tuesday that exemptions to land-use laws granted by Measure 37 cannot simply be transferred to a new owner, leaving unanswered legal questions about efforts to turn farmland into housing developments.

"If the current owner conveys the property before the new use allowed by the public entity is established, then the entitlement to relief will be lost," Myers wrote in an opinion for Director Lane Shetterly.

That means that property owners who have proposed housing developments under terms of Measure 37 would not be able to sell their property to developers to make improvements but would have to hold on to the property until the changes are finished.

2.  Bill introduced to make PGE a state-chartered utility

Three lawmakers plan to introduce a bill that would create a public corporation to run PGE if Texas Pacific Group fails in its bid to buy the utility.  The bill would be an alternative to the city of Portland's attempt to gain control of PGE.

3.  Karen Minnis throws an early hissy fit (.pdf link)

"There’s no point in the Joint Ways and Means Committee meeting until the Senate Democrats decide to get serious about what revenue we have available," said Speaker Minnis. "They played the same game two years ago, and it kept us in session until late August. They never wanted to talk about how much money we have available to spend, they only wanted to talk about what they wanted to spend and then find the money to pay for it later."

I'm not really sure if that last one was intended as comic relief or not, but we'll take our mirth where we can find it.


[Update: A reader notes that there's a fourth, fairly significant story breaking today: Mo Cheeks got the ax this morning.  Thanks BlazerRama!]

  • BlazerRama (unverified)

    Oh, come on. This is more important than Mo Cheeks being fired?

    Actually, it's funny, as OIA said they'd crossed every t and dotted every i. Of course, M37 may not help Dorothy English, etc. It's time the legislature threw out M37 and drafted their own fairness bill.

  • Rorovitz (unverified)

    Um, maybe I missed something, but is Harvey's decision really surprising? M.37 was about the right for a property owner to use their land. Not about the rights of the land. Is there really an argument for any other read of the Measure on transferability?

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    Interestingly, the Statesman-Journal takes a totally different view of the budget differences. The parties differ on only 2% of the budget. This is, in fact, much better than last year. At any rate, I still don't know that anyone will agree to raise taxes, although a few, small, incidental taxes might be possible.

    The PGE bill is cool, but too early to tell anything. As for Hardy, I like the result, but who knows about the opinion? I couldn't find it on his website. So that's a nice blow to the baddies at OIA. Really, the legislature just needs to give Dorothy her thing to quiet her and come up with a solution that will leave Oregonians satisfied, even if OIA spazzes out again.

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    Ordinarily, most property rights are transferable just like the physical land itself (think easements and other non-tangible rights). The issue we have had is whether or not M37 was indeed a grant of - for lack of a better way of putting it - "use it or lose it" authority to individuals, or if it was a grant of ordinary transferable property rights. The AG's answer kind of surprised me... well, pleased me actually.

    If my read on this is right, then if I went out today and bought a piece of land, I would not have M37 rights on that since my purchase was subsequent to the inactment of the law. The seller had the right, which expired when she sells to me. Interesting... I'd chalk that up as a pretty big development.

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    WaPo has an article on M37:

    focuses on the situation in Hood River, using a town meeting held by Wyden.

  • ron ledbury (unverified)

    A hissy fit would genuinely erupt only if Karen Minnis were to introduce legislation that required the separation of PERS costs from the ongoing education costs to keep schools functioning. The school districts often repeat that they have no control of the PERS costs that get blended into their education budgets. The Oregonian champions this belief system and so too does Stand For Children and the Chalkboard Project folks. The PERS stuff gets skimmed off by the Oregon Department of Education and redirected to PERS without ever reaching the schools. The schools claim it is the state's business, alone, . . . this PERS stuff, so it only makes logical sense that it be a separate item in the budget appropriations.

    Minnis is either being too blind or too kind.

    So? I ask. What is the school budget, the real school budget? I'd go with the plan to keep schools open,

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    Actually, most property rights are not transferable with the land. Some types of easements, when written properly, are an exception, and the rest of 'em have full four or five part legal tests to determine whether a property right "runs with the land." The point is, this isn't so very unusual.

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    Harvey only has jurisdiction over a small stretch of TV Highway just outside Reedville. As a 30ft rabbit in the marine business, he does not render statewide land use opinions but limits his practice to maritime law.

    Okay! Everybody! Blue O'ers! (What are we called anyway?) This is an important discussion and whatnot, but tonight is DFA Meetup night! So get up, get off your computers, come out and let's rally to put a stop to Bush and the neocon crime syndicate dismantling Social Security. Click here: See you there.

  • ron ledbury (unverified)

    But, Ginny, don't you know that the NEA and the public employee unions have already pledged to pretend that stocks are a good value. The assumptions of the continued bubbling growth of stocks is the very reason that state and local governments across this great land have borrowed countless billions of dollars for their pay-as-you-go pension plans; their modified hybrid pension plans. Do you really expect that the public employee sector will go back on their word in their bargain with the neocons . . . and necessarily admit that they were wrong and deceptive in their demand for borrowing public dollars to plop into stocks? The dismantling of SS was part of the plan all along, and the public employees already have their cake, and they want to eat it too. GO GET EM! Go knock yourself out trying . . . trying to save us from ourselves.

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    I really enjoy DFA meetings when I can make them. They're empowering.

    Unfortunately I can't make Wednesday meetings as I have an archery league that I do with my son.

    School budgets are a nightmare to understand,IMO. I'm in a district that actually has extra money because they saved it for a "rainy day" instead of decreasing class sizes and reinstituting cut programs.


  • Steve Bucknum (unverified)

    I felt that the Measure 37 "Opinion" by Hardy Myers (let's get his name right, he is from Crook County after all!) was well reasoned. I kept my voter's pamphlet from this last election just to keep the wording of Measure 37. Section 9 says, and I quote, "A decision by a governing body (meaning mostly County Commissions or Courts) under this act shall not be considered a land use decision as defined in ORS 197.015(10)." Most people probably were glazed over by the time they got to Section 9.

    I don't know about every County's ordinance on land use, but since they have to be approved by LCDC, I bet that around the State they are pretty similar. When I was on the Planning Commission here in Crook County, "land use decisions" included all those things that were generally allowable by zone, but which required action such as subdivisions, partitions, and variances. Action was taken through "Conditional Use Permits."

    So, if Farmer Joe has a 80 acre parcel that is just outside of Prineville, and he wants to give up on farming rocks and subdivide for houses, but he is in an EFU (exclusive farm use) zone; he might have a Measure 37 claim. According to the Measure, he or a family member would have the claim if they owned the land since the offending ordinance went into effect. In Crook County that would mean 1978. Let's say he did own it that long. Prior to 1978 the minimum lot size would have been five acres, so he can proceed with a claim to subdivide into about 14 lots, (those of you with a calculator would know that 80 divided by 5 is 16, but you have to leave room for streets and such).

    Right now bare land ready to built lots are going for about $40,000 here (yep we got cheap land). As bare land the 80 acres would go for maybe $160,000 - and as lots it would go for $640,000. (Do you begin to see why people wanted Measure 37?) The difference would be the Measure 37 claim, $480,000. Crook County doesn't have that kind of money laying around, so they would grant the Measure 37 exemption to Farmer Joe to develope his subdivision.

    But subdivisions are not just pieces of paper. They require survey's, road development, water and sewer, and so on. Big unanswered question - would Farmer Joe have to pay the system development fees that went into effect in the last 10 years for parks & rec, water and sewer, etc? Generally the subdivision development cost is going to be notable, maybe $100,000 or more to take the 80 acres and get it ready for lot sale.

    So, Hardy Myer's decision is this. Farmer Joe can't go in and get his Measure 37 exemption, and then turn around and sell the 80 acres to Snidely Developer and have the subdivision right go with it. Farmer Joe has to develop the lots, and then sell them directly on a lot by lot basis to buyers to perserve this. I have read the language of Myer's decision, and actually, I'm not sure if selling the bare lot is enough, Farmer Joe might even have to put the house on it too.

    Once a house is on the lot created in this manner, I doubt that the property would revert back once sold and then immediately require that the house be torn down - but it would still be in the Exclusive Farm Use zone because a land use decision for a conditional use was not made. The zoning language does state that you cannot rebuild a use that is no longer permitted - no grandfathering. So, if the house later burned down, the way it looks to me, you couldn't rebuilt it.

    I am a real estate appraiser. I know of no lenders that will loan on the basis of a grandfathered use where you cannot rebuild. There is no point to fire insurance if you can't rebuild.

    This decision is a real blow to those that want to use Measure 37 to get around land use development laws. About the only scenario I can think of where this decision doesn't affect much is when a corporation owned a piece of land they wanted to use. What if PGE owned a 40 acre parcel they wanted to put a gas/electrical plant on, but zoning killed it? Since PGE can self-insure, and will continue to own the land, they could now build their power plant or get paid not to.

    When you think through the Myer's decision, I think it has about killed Measure 37.

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    That was awesome, Steve. I wouldn't be the least surprised if courts adopted Hardy's views on this matter. Regardless, I think the Democrats in the state legislature need to take the frustrations of M37's backers and do more than just form a commission. M37 is ridiculous and we want to keep our land use laws. But making a few small, but symbolic, adjustments in addition to the commission would be a good idea. It might help put off the initiative beast that is OIA.

  • engineer (unverified)

    Thanks Steve that was informative. Using your example however, it seems to me that a developer could front Farmer Joe the necessary development fees with the understanding (through a contract supposedly) that Farmer Joe would sell the developed land to the developer once Joe jumped through all the M37 hoops??

  • Steve Bucknum (unverified)

    Interesting Comment Engineer - But think about it a minute.

    Snidely Developer could team up with Farmer Joe to create a subdivision using Measure 37. But - even though they could write a contract that Farmer Joe would split profits with his investor, that contract could be secured by the land, but only the land prior to the subdivision. If Snidely Developer and Farmer Joe have a conflict, and that happens all the time, Snidely Developer might be out all his money and have to foreclose against the collateral of the land - but Snidely Developer is then stuck with land he can't develop - he doesn't have Measure 37 standing.

    If Snidely and Joe do get along, and they get to the point that they have sold all the new homes - they still have the zoning problem / can't rebuild the homes problem.

    One further thought - these lots probably won't be able to get title insurance.

    There is a precident for this kind of thing. Sometimes land is given as a restricted gift. For example, someone might give land to a Hospital, but have a reversion clause in the deed that if the land is no longer used as a Hospital, the land reverts to the donor, or his descendants. These sorts of reversions of property, while rare, do happen.

    Perhaps the same sort of process will happen with Measure 37 based on Myer's decision. So long as the Measure 37 applicant controls/owns the land, they can do what they want, but as soon as they sell, there is a reversion of law. Yep, that could mean tear down the house, tear down the auto shop in the farm field, etc.

    It is also my understanding that when the Attorney General of Oregon issues an "opinion" - it has the effect of law until over-ruled by a court. It would be binding on all Counties unless Myer's specifically said it was not.

    Things may actually play out very fast with Measure 37.

  • justin (unverified)

    Excellent analysis Steve. That was really helpful.

    It seems to me that with Myers decision, M37 only helps people who want to build an extra home on their land for their family. It doesn't help people get rich off the land.

    Which is a great compromise if you ask me.

    IMO, the legislature needs to enact meaningful land use reform. Yet, I sincerely doubt they will ever be able to agree on anything. And as such, we're just going to have another M37 in 2006.

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    Building on what Steve said. I have heard banks are hesitant to loan money based on M37 claims. So it will be much harder for Joe Farmer to go to a bank and get a loan to build his subdivision in the middle of Farm County. I mean if the development doesn't sell and the bank has to foreclose it goes back to being farm land.
    Hardy’s decision does help the people that have a real issue with our mighty land use system. I know a guy on Sauvie Island. His parents own a farm out there and they are very elderly. He wants to build another house on the 20 acres so he can be close to them on a part of the property that is unusable for framing. He doesn't want a million billion dollars from the government and doesn't want to build a mini mall in the middle of farm land. He wants to build a second dwelling on his parents land for his own use.

    I hate M37 and think we have created a new PERS that we'll have to deal with for the next decade. However, I love the fact that I used "I hear" and "I know a guy" in this post. HA Everyone come to Happy Hour tonight.


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    err... Correct Happy Hour is tomorrow

  • Becky (unverified)

    Believe it or not, back when I was working on Measure 7, our intent was right in line with Hardy Myers' decision. We never intended for rights to be transferable to future owners. We only wanted property owners to be able to use their land the way they could when they bought it. I'm not sure about the benefit to a community of your interpretation of this grandfathering thing, however. If a house in a neighborhood burns down, the lot is unlikely to ever be used for farming. It would simply remain an eyesore for the rest of the neighborhood. How does that help anyone? Why would people support the law being implemented in that way? At a point you have to be realistic and not press for your idealogy so much that you create a stupid governmental system. That just leads to more frustration and more reactionary initiatives. Anyway, I think Myers' decision goes to show how much everyone on the left bought into the over-the-top anti-Measure 7 and anti-Measure 37 scare tactics.

  • ron ledbury (unverified)

    The UGB was/is based on a 20 year supply of land. If, say, 200 years passes or the UGB is instead based on a 200 years supply of land won't most of the M37 claimant's land fall within the new UGB's?

    A feature of the definition of property is the right to alienate one's interest in something, which is essential to creating markets. If the right to develop is personal what then shall I make of the treatment of the new fangled concept of “Tradeable Development Rights?” Are they property or personal stuff dependent upon the whim of a future politician?

    Consider this proposition - When you die your house must be either torn down or given to your kids. Sounds absurd. It all sounds as if the fixed definitions of property are themselves at issue. There is no property, there is only the king and his merry band of servants, each given little protectorates, and then a bunch of peasants. Lets all cheer the retreat from liberty shall we.

  • Rorovitz (unverified)

    Becky's post was the point I was trying to make. I thought that the supporters were really arguing that the rights would only extend to the individual, not the property.

    Now I fully expect them to try to go further, because I think they really wanted to get rid of all land use planning, not just making the system more fair.

    Or, to the benefit of Becky, who I think is a nice person who has earnest ideas that are taken to extremes by the thugs and obnoxious jerks she hangs out with, some of the people around M. 37 and OIA will use the measure to get rid of big chunks of our planning system.

  • Aaron (unverified)

    Me thinks that Mr. Gazelle is a little thirsty.

    The potential of "non-transferable rights of property improvements" for anyone that purchases after the current owner "wins" a claim to improve, and improves upon it; their property is a nice way of slowing down M37 claims against the various municipalities.

  • Eric (unverified)

    Again, we are going to lose credibility with these types of games.

    When that old lady was on those ads did she say she wanted to use the land for herself? NO -- it was for her children.

    All of us who opposed M37 said that if it passed it would pass on to the next generation and provide for rural subdivision -- now we find some loophole????

    I hate the hypocrisy of the right and I am starting to hate the hypocrisy of the left. Hardy et. al., you undermine our credibility with these legal games!!!

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    No loophole. If you can't beat 'em one way, beat 'em another way. That's politics.

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    Here's proof of how close they all were on the budget.

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