2008-543-Order No. 2008-036 Recorded 4/25/2008COUNTY OFFICIAL
NANCYUBLANKENSHIP, COUNTY CLERKDS 1~d 008.543
REVIE D COMMISSIONERS' JOURNAL 04/15/2008 09;52;35 AM
AL GAL C UNSEL 1111111111111111111111111111111
2008-543
BEFORE THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON
An Order Denying a Waiver of Land Use
Regulations pursuant to Ballot Measure 37 - * ORDER NO. 2008-036
Dunham
WHEREAS, On November 2, 2004, the voters of the State of Oregon approved Ballot Measure 37
which added provisions to Oregon Revised Statutes (ORS) Chapter 197 to require, under certain circumstances,
payment of just compensation to landowners if a government land use regulation reduces property value. In lieu
of just compensation, Ballot Measure 37 authorizes the governing body of a local government to modify,
remove or not apply the land use regulation, and
WHEREAS, William and Mary Lou Dunham made a demand for compensation under Measure 37 for a
reduction in value to its property at 55540 Lazy River Drive, Bend, Oregon due to regulations which they claim
took effect after they acquired this property, and
WHEREAS, Section 8 of Measure 37 authorizes the Board, as the governing body responsible for
adoption and enforcement of County regulations, to not apply one or more identified land use regulations that
restrict the owner's use and reduces the value of the property in lieu of payment of compensation; and
WHEREAS, the Board has received the report and recommendation of the County Administrator as
required by DCC 14.10.090; and
WHEREAS, the Board has considered the Administrator's report and the evidence presented by the
parties at a Board meeting as required by DCC 14.10.090; and
WHEREAS, the Board makes the following findings of facts and conclusions;
On April 27, 2007, William and Mary Lou Dunham filed a Measure 37 claim with the
Community Development Department.
2. The property is located at 55540 Lazy River Drive, Bend, Oregon and is within Deschutes
County.
The County Administrator has recommended against waiver of county regulations for the
subject property. The Administrator's report is attached and incorporated by reference into this
Order as Exhibit "A."
4. The Board concurs with the Administrator's report that William and Mary Lou Dunham are the
present owners of the subject property, having acquired an interest in it and continuously owned
it since April 30, 1968. The County finds and concludes as set forth below.
The Board concurs with the Administrator's report that current regulations of sanitary sewer
service, if applied to the subject property, would not permit a septic permit on the subject
property. Such regulations were adopted by the State.
PAGE 1 OF 2- ORDER No. 2008-036 (04/21/08)
6. Measure 37 exempts regulations for the protection of health and safety, specifically sanitation
and solid waste regulations.
7. Measure 37 also requires that a claim be submitted within two years of its adoption and this
claim was filed later than two years.
8. The Board concurs with the Administrator's report that there is no evidence which demonstrates
that County's regulations for a land use permit adopted after Claimant's acquisition date have
reduced the value of the subject property, now, therefore,
THE BOARD OF COUNTY COMMISSIONERS OF DESCHUTES COUNTY, OREGON, HEREBY
ORDERS as follows:
Section 1. The Board hereby determines, based on these findings, conclusions, and the Administrator's
report in Exhibit "A," that the claim is not eligible under DCC 14.10.100.
Section 2. A STATE OF OREGON MEASURE 37 WAIVER WOULD BE REQUIRED FOR THE
DEVELOPMENT OR USE OF THE SUBJECT PROPERTY. ALTHOUGH THE COUNTY WILL ACCEPT
AND PROCESS SUBSEQUENT LAND USE APPLICATIONS ASSOCIATED WITH THE SUBJECT
PROPERTY, APPROVAL MAY NOT BE GRANTED WITHOUT A VALID WAIVER FROM THE STATE
PERTAINING TO STATE REGULATIONS WHICH WOULD OTHERWISE PRECLUDE THE PROPOSED
LAND USE. THIS WAIVER APPLIES ONLY TO THE LOCAL REGULATIONS SPECIFIED ABOVE.
DESCHUTES COUNTY LACKS THE AUTHORITY TO WAIVE ANY STATE REGULATIONS OR LAWS.
STATE LAWS AND REGULATIONS MAY APPLY TO THE USE OF THE PROPERTY DESCRIBED
HEREIN, AND A WAIVER OF SUCH LAWS AND REGULATIONS MUST BE SEPARATELY
OBTAINED BY THE OWNERS FROM THE STATE OF OREGON.
DATED this Vffo-day of April, 2008.
BOARD OF COUNTY COMMISSIONERS
OF DESC TES COUNTY, OREGON
D NNIS R. LU , CHAIR
ATTEST:
L~
Recording Secretary
PAGE 2 OF 2- ORDER No. 2008-036 (04/21/08)
Aill'a ~A& f-ArA.
NE M T N, VICE CHAIR
Deschutes County Department of Administrative Services
1300 NW Wall St., Ste. 200, Bend, OR 97701-1947
(541) 388-6570 Fax (541) 385-320? - www.deschutes.org
TO: Board of County Commissioners
From: David Kanner, County Administrator
DATE: April 21, 2008
RE: Measure 37 Claim - William and Mary Lou Dunham (Claimants)
64496E Brightwood Loop, Brightwood, OR
Introduction
The County processed the initial Measure 37 claims using its brief claim form, evaluating the submission,
and preparing this report and recommendation under DCC 14.10, the Measure 37 ordinance. The
County's claims process recognizes that less precise evidence of value may be sufficient to evaluate
claims, since there are currently no County funds available for payment of compensation. Also, the
ordinance provides further opportunities for affected neighbors to present evidence and testimony at the
Board meeting when these claims are considered.
This report and recommendation is intended to be a summary and evaluation of evidence in the record.
The report may be attached to the Board's Order which decides Measure 37 claims, as a factual basis for
the Order. Any factual changes or additions to this report from testimony or other evidence can be made
part of the Board's Order. Claimant and affected parties have the opportunity to rebut this Report and
provide additional relevant evidence to the Board. Also, under the County's process, claimant must
provide evidence that the desired use of the property, which may be allowed by a waiver of County
regulations is feasible, i.e., not prevented by physical, utility or other development limitations of the site.
Report and Recommendation - DCC 14.10.090
This is my report and recommendation on this Measure 37 claim received on April 27, 2007, when
Measure 37 was in lawful effect. While Claimants' documents are dated November 13, 2006, the claim
was not received by the county until April 27, 2007. Claimant has not paid the filing fee but has submitted
the County's official demand form. The property consists of one lot with approximately 4 acres in one tax
lot. The current zoning is Flood Plain (FP), Landscape Management (LM), Rural Residential (RR-10) and
Page 1 of 5 - Exhibit A - Order No. 2008-036
Wildlife Area (WA). The Claimant's desired use is to obtain approval for a septic system to serve a
residence, currently restricted by DEQ regulations over potential ground water contamination. Claimant
alleges a reduction in value of approximately $150,00 to $200,000 due to the inability to develop a
residential use as desired. The following is an analysis of the evidence in the record on the elements of
this Measure 37 claim.
Current Owner - Claimants assert on the claim form that they are owners of the property comprising this
claim: 20-11-30A, Tax lot 1400 located at 55540 Lazy River Drive, Bend. Claimants submitted a copy of
a land sales contract, dated April 30, 1968, showing claimants and William and Nancy Stoffal as
purchasers. The two couples obtained title to the property by warranty deed in 1977. In 2002 claimants
conveyed an interest in the property to Thomas and Jamie Grandy, who are not included as claimants in
this proceeding. The record does not disclose at what point, if at all, the interest of the Stoffal's was
terminated.
Owner Date of Acquisition - April 30, 1968
The date of acquisition by the current owner is the relevant date for Board consideration of waivers under
section (8) of Measure 37. The compensation section of Measure 37, section (6), uses the acquisition
date of a family member to determine the extent of reduction in value for compensation. Since the County
has no funds budgeted for payment of compensation, waivers that are issued by the County are limited
by section (8) of Measure 37 to County land use regulations that were adopted after the later acquisition
date of the current owner. If a waiver is granted as to County land use regulations which were adopted
after the current owner's acquisition date, no compensation is due, even if the prior family member held
the property for many years. While this may seem inconsistent, the measure was, evidently, written to
encourage waivers of local and state land use regulations. The first date for which there is documentation
showing claimant obtained an interest in the property is April 30, 1968. The interest of Thomas and
Jamie Grandy did not arise until 2002, and the application does not indicate that they either approved or
have joined in this application.
Restrictive Regulation - Zoning Regulations.
Under the terms of the ordinance, the claimant must identify County land use regulations that prevent the
claimant from using the property in a way that it otherwise could have used the property at the time the
property was acquired, and thus reduce the value of the claimants' property. The Claimants have
Page 2 of 5 - Exhibit A - Order No. 2008-036
identified only provisions of the DEQ regulations which claimants allege have reduced the value of their
property by prohibiting their ability to site a residence on the property. Claimants assert that rules
adopted by the Oregon DEQ, together with the county's application of same (to require particular sewer
system improvements rather than typical sand filter system) have reduced the value of the property by
rendering it unsuitable for residential use. There is no evidence that claimants have applied for a variance
from application of this rule. Claimants did obtain a determination from the county in July 2006 that a
standard septic system for a residential use would not be allowed, based upon DEQ requirements.
Claimants did not pursue further appeal or variance application. Claimants have not applied for land use
approval .
Enforcement of County Regulation - futile DCC 14.10.040(G).
Measure 37 requires that an ordinance which restricts the current owner's use be "enforced" against
them. Claimant has not applied for a building permit resulting in the current county land use regulations
being enforced on the subject property. Claimant has asserted that submitting an application for such a
permit would be futile. This Report confirms that such an application for the desired residence using a
standard sand filter septic system would violate the current DEQ requirements and be denied.
Measure 37 also requires that a claim for compensation be filed within two years of December 2, 2004 or
the date the public entity applies the land use regulation as an approval criteria to an application
submitted by the owner. (ORS 193.352(5)) In this case claimant has submitted the claim later than two
years after December 2, 2004. Claimants might attempt to rely as justification for such late filing the
county's response to their application for septic site evaluation. Claimants have offered no other
justification for filing their Measure 37 more than two years after its adoption. The DEQ rule on which the
county's response is based is not a land use regulation, but one designed to protect health and safety or
the regulation of sanitation under ORS 197.352(3)(6). Thus, claimant's application under Measure 37 is
time barred.
Reduction in Value - $$150,000 to $200,000 alleged on Claim Form
The ordinance requires that the Claimant provides evidence of the amount of the claim in alleged
reduction in the fair market value of the property resulting from the enforcement of the County's land use
regulation.
Page 3 of 5 - Exhibit A - Order No. 2008-036
• Claimant has not submitted an appraisal, or opinions from real estate professionals in an attempt
to show the diminution in value based upon limitations on development of the property.
Claimant's alleged reduction in value appears to be based upon the assumption that a buildable
lot would be fully marketable and useable by others for development. Referring to a recent
Opinion of the Oregon Attorney General, rights obtained under Measure 37 are personal to the
present property owner. Assuming an owner, having obtained the necessary "waivers" from the
County and the State, could develop the property, future owners would, according to the Attorney
General, be precluded from using the property in a manner inconsistent with land use regulations
in effect at the time of the transfer. Thus, the amount of reduction in value asserted by the
Claimant may be unreliable, if the resulting lots are unusable by future owners, based on it having
to comply with zoning regulations in place when such future owners acquire the property. If a
claimant could have obtained approval of a residential permit on the date it first acquired an
interest in the property, but not under zoning restrictions adopted after Claimant's acquisition
date, and the resulting lots are fully marketable and useable by future owners, then the value of
Claimant's property for Measure 37 purposes would be reduced. Consistent with the County's
procedural ordinance, Chapter 14.10, this report takes no position on whether a waiver obtained
by a claimant and any resulting development approval are fully transferable with the property.
• Claimant's opinion on the reduction in value is based upon a real estate listing agreement dated
1991 in which La Pine Realty agreed to list the property for $20,000. Claimant refers to, but has
not furnished similar listing agreements from prior years. Claimants purchased the property in
1968 for $4,600. According to the County's Department of Assessment and Taxation, the real
market value of the property is $133,600. In 2002 the Grandy's purchased a '/2 interest in the
property for $1500. There is no indication of how the property's value would be or has been
affected by application of nonexempt county land use regulations. There is no evidence to
indicate that county land use regulations have had the effect of reducing the value of claimants'
property by any amount, much less $150,000 to $200,000.
Effect of County Waiver - Measure 37 clearly allows the County to waive its non exempt land use
regulations only back to the date the current owners, not family members, acquired the property:
"(8) Notwithstanding any other state statute or the availability of funds under
subsection (10) of this act, in lieu of payment of just compensation under this act,
the governing body responsible for enacting the land use regulation may modify,
remove, or not to apply the land use regulation or land use regulations to allow
the property owner to use the property for a use permitted at the time the owner
acquired the property."(emphasis added)
11(c) "Owner" is the present owner of the property, or any interest therein."
In this case, claimant has continuously, though not exclusively owned an interest in the property since
1968. A claimant who receives a waiver must use the current process to seek the needed permits based
on the zoning in place at the time the current owner acquired the property. Except in a rare case, the
current procedural requirements for handling permits are not regulations that reduce value. Therefore, the
County's procedural regulations are not waived.
Page 4 of 5 - Exhibit A - Order No. 2008-036
Effect of Adoption of Measure 49
On November 6, 2007 the Oregon electorate approved a measure referred by the Oregon Legislature
commonly known as Ballot Measure 49 (HB 3540), which had the effect of substantially amending the
provisions of Measure 37. It would appear that since claimants submitted this claim under Measure 37
prior to close of the 2007 legislative session that they may be entitled to submit a claim under Measure 49
and obtain approval for up to three residential homesites. Such a claim would be submitted to the State
Department of Land Conservation and Development.
Conclusion and Recommendation
The present owners of the property have submitted a claim pursuant to Measure 37 which fails to
demonstrate eligibility for use of the subject property based on nonexempt land use regulations in effect
on April 30, 1968, the date when Claimants first acquired an interest in the property. The claim was filed
after the 2-year statute of limitations contained in ORS 197.352(5) and fails to demonstrate that
nonexempt county and state land use regulations (in the two years preceeding the filing) have been
applied to reduce the value of claimant's property. The restrictive regulation which Claimants assert has
reduced the value of their property is not a county regulation and appears to be an exempt health and
safety regulation or a sanitation regulation under ORS 197.352.(3)(8). Evidence of reduction of value has
not established that it has occurred or, if it has, that it is the result of one or more county land use
regulations. Further, because of adoption of Measure 49, claimant no longer has the opportunity to
pursue a claim under Measure 37.
My recommendation is that the Board deny the claim in the form of Order attached.
Page 5 of 5 - Exhibit A - Order No. 2008-036