IN THE COURT OF APPEALS FOR THE STATE OF OREGON

Transcription

1 IN THE COURT OF APPEALS FOR THE STATE OF OREGON SOUTHEAST NEIGHBORS NEIGHBORHOOD ASSOCIATION, Petitioner Cross-Respondent, v. CITY OF EUGENE, Respondent, Land Use Board of Appeals LUBA No CAA EXPEDITED PROCEEDING UNDER ORS and WEST CREEK LLC and SOUTH PARK ASSOCIATES LLC, HOMEBUILDERS ASSOCIATION OF LANE COUNTY, Respondents Cross-Petitioners. RESPONDENT CITY OF EUGENE'S ANSWERING BRIEF Appeal from the Final Opinion and Order of the Land Use Board of Appeals; Board Member Ryan. Anne C. Davies, OSB # City of Eugene City Attorney's Office 125 E. 8th Avenue Eugene, OR (541) Of Attorneys for Respondent City of Eugene Daniel C. Snyder, OSB # Law Offices of Charles M. Tebbutt, P.C. 941 Lawrence Street Eugene, OR (541) dan. Of Attorneys for Petitioner [continued inside cover] September 20 13

2 Bill Kloos, OSB #81140 Law Office of Bill Kloos PC 375 W. 4th Street, Suite 204 Eugene, OR (541) Of Attorneys for Respondents Sean T. Malone, OSB # Attorney at Law 259 E. 5th A venue, Suite 200-G Eugene, OR (303) seanmalone8@hotmail.com Nicholas S. Cady, OSB # Cascadia Wildlands P.O. Box Eugene, OR (541) nick@cascwild.org Attorney for Amicus Curiae Cascadia Wildlands Attorney for Amicus LandWatch Lane County

3 INDEX I. STATEMENT OF THE CASE A. Questions Presented on Appeal..."... 1 B. Summary of Argument...:... 2 C. SUJJimary of Material Facts... 2 II. CITY'S RESPONSE TO PETITIONER'S SECOND ASSIGNMENT OF ERROR and BRIEF OF AMICI CURIAE... 3 LUBA correctly denied Petitioner's attempt to employ the "dear and objective" requirement as a sword and concluded correctly that the City's approval of certain "modifications" to what were otherwise clear and objective standards did not run afoul of the statute... 3 A. Background of ORS ( 4)... ~ 3. B. LUBA's Decision... :... 5 C. Statutory Interpretation... 8 III. CONCLUSION Cases TABLE OF AUTHORITIES Home Builders Assoc. v. City of Eugene, 41 Or LUBA 370, 38.3 (2002)... ;... 5, 7, 8 Linstromberg v. City of Veneta, 47 Or LUBA 99, (2004)... 5, 7, 8 Quoted in Mcintyre-Cooper Co. v: Board of Comri1issioners of Washington County, 55 Or App 78, 83, 637 P2d 201 (1981)... 4 State v. Gaines, 346 Or 160, , 206 P3d 1042 (2009) Eugene Code EC EC ~... 3 EC ~... 6, 7 EC ~... 6, 7, 8 EC (7)(a) , 2, 8 EC (10)... :... 3, 8 EC (11)...;... 3, 7

4 Statutes 11 ORS , 9 ORS (1)... :... 4 ORS (3)(b)(2009)... ;... 10, 12, 13 ORS (3)(d) (2009)... ;... 12, 13 ORS (3)( d)(l997)... ~... 6 ORS ( 4)... 1, 3, 4, 5, 8 ORS (6)... :... :... :... 5, 7, 12 ORS (6)(2009) ORS ( 4) and (6)... 1, 2, 10 Other 1981 Or Laws, ch. 884, sections

5 I. STATEMENT OF THE CASE 1 Respondent ("the City") accepts Southeast Neighbors Neighborhood Association's ("Petitioner") Statement of the Case, except as set forth below. A. Question Presented on Appeal Is LUBA's order lawful in substance in concluding that the City's approval of modifications to clear and objective lot size 1 and solar standards, requested by the applicant, does not violate provisions of the needed housing statute? ORS (4) and (6). B. Summary of Argument The Eugene Planning Commission approved modifications to code standards involving minimum lot size and building orientation requirements addressing solar access. On appeal to LUBA, Petitioner argued that the City's reliance on discretionary standards in order to grant those modifications was a violation ofthe "clear and objective" requirement found in ORS (4). LUBA rejected that argument, citing previous case law that (1) interprets the statute to allow an applicant to voluntarily subject itself to a discretionary. review as an alternative to the "clear and objective" review track, and (2) holds 1 Before LUBA, Petitioner argued about modifications to solar lot standards and the standard that prohibits any new lots if more than 33% of the lot would be occupied 1Jy the combined area of the Water Resource conservation setback and any portion of a Goal 5 water resource site that extends landward beyond the conservation setback. _EC (7)(a). See LUBA Rec On appeal, Petitioner now argues about the minimum 4,500 square foot lot size found in EC Cross-Petitioners raise the waiver issue.in their response brief.

6 that allowing a variance to an otherwise clear arid objective standard does not 2 violate the statute. LUBA did not err in that regard. On appeal, Petitioner and Amici 2 now contend that the City's entire. needed housing pro~ess is flawed. Petitioner's Opening Brief at That argument is based on a statutory construction argument involving ORS (4) and (6). LUBA did not have the opportunity to address this issue, because it was not raised below, at least not with sufficient clarity to all.ow the parties or LUBA to respond. However, even ifluba had had the opportunity to address this issue, it would have come to the same conclusion. The statute is designed to provide protections.to developers of needed housing, ensuring that cities do not use discretionary standards to prohibit types of housing that are needed in a community. The language of the statute, its context and legislative history support LUBA's holding. C. Statement of Material Facts The City incorporates the facts set forth in LUBA's opinion. Those facts can be located at ER-2 through ER-3 of Petitioner's brief. The specific facts relevant to this particular assignment of error are set forth below: "EC (7)(a) provides lot dimension standards and prohibits new lots where more than 3 3 percent of the lot occupies the combined area of the Water Resources conservation setback and any portion of a Goal 5 water resource that extends beyond the I 2 Amici Curiae and Petitioner make essentially the same argument. For ease of reference, this brief will refer to Petitioner and Amici collectively as "Petitioner."

7 setback. EC (10) requires the PUD to comply with the solar "lot standards at EC EC in tum provides that 70 percent of the lots in a proposed PUD must have a minimum northsouth dimension of75 feet and a front lot line orientation that is within 30 degrees of the true east-west axis." Petitioner's Opening Brief at ER The planning commission granted applicant's requested modifications, under EC (11), to both standards. IT.. CITY'S RESPONSE TO PETITIONER'S SECOND ASSIGNMENT OF ERROR and BRIEF OF AMICI CURIAE LUBA correctly denied Petitioner's attempt to employ the "clear and objective" requirement as a sword and concluded correctly that the City's approval of certain "modifications" to what were otherwise clear and objective standards did not run afoul of the statute. A. Background of ORS (4) ORS is part of what has become known as the "needed hous.ing" statutes. The clear and objective language found in ORS (4) was part of LCDC's informal policy, known as "St. Helens Policy," as early as Prior to the adoption of administrative rules implementing Statewide Planning Goal 10 (Housing), LCDC adopted the following policy language: "Where a need has been shown for housing within an urban growth boundary at particular price ranges and rent levels, housing types. determined to meet that need shall be permitted in a zone.or zones with sufficient buildable land to satisfy that need. This policy shall not be construed as an infringement on a community's prerogative to 1) set approval standards under which a particular housing type is permitted outright, 2) impose special conditions upon approval of a specific development proposal, or 3) establish approval procedures. However, approval standards, special conditions, and. the procedures applicable to both 1) must be clear and objective

8 and 2) must not have the effect, either of themselves or cumulatively, of discouraging, such as through unreasonable cost or delay, the needed housing type." Quoted in Mcintyre-Cooper Co. v. Board of Commissioners of Washington County, 55 Or App 78, 83, 637 P2d 201 (1981). 4 The availability of safe, affordable, decent and sanitary housing is a matter of statewide concern. ORS (1). The St. Helens Policy was intended to il1lplement that statewide concern by requiring that criteria that apply to needed housing developments be clear and objective. The goal was. and is to eliminate the ability for local governments to deny needed housing (generally aimed at low-cost housing) development through application of extremely subjective, discretionary criteria. The St. Helens Policy was codified in statute in 1981, and some semblance of that language has existed in the statutes since that time Or Laws, ch. 884, sections 5-6. The language is currently found in ORS (4): "Except as provided in subsection (6) of this section, a local government may adopt and apply only clear and objective standards, conditions and procedlires_regulating the development of needed housing on buildable land described in subsection (3) of this section. The standards, conditions and procedures may not have the effect, either in themselves or cumulatively, of discouraging needed housing through unreasonable cost or delay." It is important to keep the St. Helens Policy and the impetus for the needed housing statute in mind when ruling on Petitioner's argument. The overarching goal is to protect developers seeking to construct needed housing from unbridled discretion of cities that may use such discretion to block certain types

9 of housing (e.g., manufactured homes) from developing in their city limits, 5 which cities had been known to do, particularly through the use of discretionary standards regulating appearance or aesthetics. B. LUBA's Decision Before LUBA,.Petitioner argued that the granting of the modifications by the City violated ORS (4), because the standards considered in granting the modifications involved subjective, value-laden analyses. LUBA Rec Before LUBA, Petitioner's argument was that the modification criteria in the City Code were not clear and objective, and therefore could not be applied. LUBA Rec Be~ore LUBA, Petitioner did not make the statutory interpretation argument that it now makes to this Court. L UBA held, based on the arguments that Petitioner did make: "In Homebuilders, we concluded that 'the city may provide a needed housing applicant with a choice between meeting a clear and objective standard by complying with its terms or by obtaining a discretionary variance or adjustment to that standard without offending ORS (6)[(2001)].' Homebuilders, 41 Or LUBA at 400. We agree with West Creek that the needed housing statute protects an applicant for a permit for needed housing from the city's imposition of discretionary standards without its agreement,. but that an applicant may agree to be bound by discretionary standards without running afoul of the statute. See Linstromberg v. City of Veneta, 47 Or LUBA 99, i08-09 (2004) (ORS (4) does not require that a variance standard to an approval criterion for needed housing be clear and objective)." Petitioner's Opening. 3 BriefER As noted above ORS (6) [2001].is now incorporated into ORS ( 4) [2011]..

10 6 LUBA did not err in so holding. The language quoted above recognizes the underlying policy of the needed housing statutes, and provides that the developer of needed housing has the option of agreeing to be bound by discretionary standards. That agreement to be bound by non "clear and objective" standards could occur at one oftwo junctures. First, a developer could opt for a discretionary review at the outset of the application process, by choosing to apply under one of two alternate processing tracks set out in the City's Code, (1) the clear and objective needed housing track (see, e.g., EC ), or (2) the regular, discretionary, non "clear and objective" track (see, e.g., EC ). Since 1997, ORS has included language explicitly providing this flexibility regarding the clear and objective requirement. It specified that local governments could, in addition to offering the required clear and objective approval process to developers of needed housing, an alternate approval process for needed housing that is not based solely on clear and objective standards, provided the developer retained the option of proceeding under either track. The language added in 1997 provided: "In addition to an approval process based on dear and objective standards as provided in paragraph (b) of this subsection, a local government may adopt an alternative approval process for residential applications and permits-based on approval criteria that are not clear and objective provided the applicant retains the option of proceeding under the clear and objective standards or the alt~rnative process and the approval criteria for the alternative process comply wit~ all applicable land use planning goals and rules." ORS (3)(d)(1997).

11 The City of Eugene was one of the first in the state to adopt clear and 7 objective standards and has, since that time, also offered the discretionary track. Home Builders Assoc. v. City of Eugene, 41 Or LUBA 370, 383 (2002). The criteria that apply for tentative PUD approval under the clear and objective, "needed housing" track are found at EC (Titled, Tentative Planned Unit Development Approval Criteria- Needed Housing.) The alternate, non "clear and objective" track is located at EC (Titled, Tentative Planned Unit Development Approval Criteria- General). There ~s also a second way a developer could agree to be bound by non "clear and objective" standards. A developer of needed housing_ could apply under the clear and objective path, but opt for some discretionary review by requesting a waiver, variance or modification to a specific clear and objective standard. EC ( 11). For instance, an applicant could seek a variance to a "clear and objective" approval criterion that requires a specific density. LUBA has held that the fact that the applicant voluntarily seeks to apply discretionary variance criteria in order to obtain a loosening of the standards does not make those clear and objective density requirements any less "clear and objective." Home Builders, 41 Or LUBA at 400 ("city may provide a needed housing applicant with a choice between meeting a clear and objective standard by complying with its terms or by obtaining a discretionary variance or adjustment to that standard without offending ORS (6)[(2001)]"); Linstr~mberg v.

12 City of Veneta, 47 Or LUBA 99, (2004) (ORS (4) does not 8 require that a variance standard to an approval criterion for needed housing be clear and objective). Petitioner's challenge involves this second type of agreement by the applicant. The applicant in this case proceeded under the "needed housing," "clear and- objective" track pursuant to EC By reference at EC (10),that track includes approval criteria addressing access to the sun or "solar lot standards" and standards that ensure waterways are not eroded by development. EC (7)(a). The applicant requested a discretionary review to obtain a modification to those standards. Under a correct application of the law, as expressed in LUBA's rationale in the challenged order and in Linstromberg and Home Builders, Petitioner's attempt to invoke the needed housing statute to challenge the City's modifications in this case fails. The City urges the Court to adopt LUBA's reasoning in those cases and reject this assignment of error. C. Statutory Interpretation For the first time on appeal, Petitioner raises an entirely novel argument. Petitioner now argues that because of the 2011 amendments, a local government may apply non "clear and objective" criteria only when governing appearance or aesthetics. According to Petitioner, the City does not have

13 discretion, even at the request of the applicant, to ever apply discretionary 9 criteria unless those criteria govern appearance or aesthetics.. It is the City's position that the Court should not even reach Petitioner's statutory interpretation issue, either because it was not preserved or because the Court should dispense with the issue as LUBA did, because the Cicy' s choice to grant the modifications does not violate the statute. In the event that the Court opts to address Petitioner's statutory interpretation argument, the City offers the following response. In determining the meaning of statutes, the Court's task is to attempt to discern the intent of the legislature. In doing so, it is to begin with the text and context of the statute but give due consideration to any relevant legislative history. State v. Gaines, 346 Or 160, ,206 P3d 1042 (2009). Petitioner relies on the legislature's 2011 amendments to _ORS to support its argument. However, Petitioner does not explain how those amendments would change the rationale for allowing cities to provide alternate tracks for needed housing or for allowing developers to seek and obtain modifications to otherwise clear and objective standards. Rather, it makes a somewhat warped, illogical statutory interpretation argument that would stand decades of needed housing legislation and case law on its head. The 2011 amendments adopted the following language, which is the language that applies to this case:

14 "( 4) Except as provided in subsection ( 6) of this section, a local government may adopt and apply only clear and objective standards, conditions and procedures regulating the development of needed housing on buildable land described in subsection (3) of this section. The standards, conditions and procedures may not. have the effect, either in themselves or cumulatively, of discouraging needed housing through unreasonable cost or delay. 10 * * * "( 6) In addition to an approval process for needed housing bas~d on clear and objective standards, conditions and procedures as provided in subsection ( 4) of this section, a local government may adopt and apply an alternative approval process for applications and permits for residential development based on approval criteria regulating, in whole or in part, appearance or aesthetics that are not clear and objective if: "(a) The applicant retains the option of proceeding under the approval process that meets the requirements of subsection ( 4) of this section; "(b) The approval criteria for the alternative approval process comply with applicable statewide land use planning goals and rules; and "(c) The approval criteria for the alternative approval process authorize a density at or above the density level authorized in the zone under the approval process provided in subsection ( 4) of this section." The 2011 amendments were intended to clarify the needed housing provisions, but not to make any substantive changes. ORS ( 4) and ( 6) were the legislature's attempt to combine what was previously stated in ORS (3)(b), (3)(d) and (6)(2009). 4 Subsection (4) now provides the general 4 Those provisions, in 2009, provided:

15 rule that local governments may only apply clear and objective standards 11 conditions and.procedures to needed housing applications. Subsection (6) provides the exception (the alternative, non "clear and objective" track) that used to lie in subsection (3)(d). It is that subsection that Petitioner relies upon to argue that, now, an alternative, non "clear and objective," track can only be used where regulations addressing appearance or aesthetics are involved. "(3)(b) A local government shall attach only clear and objective approval standards or special conditions regulating, in whole or in part, appearance or aesthetics to an application for development of. needed housing or to a permit, as defined in ORS or , for residential development. The standards or conditions may not be attached in a manner that will deny the application ot reduce the proposed housing density provided the proposed density is otherwise allowed in the zone. * * * "(d) In addition to an approval process based on clear and objective standards as provided in paragraph (b) of this subsection, a local government may adopt an alternative approval process for residential applications and permits based on approval criteria that are not clear and objective provided the applicant retains the option of proceeding under the clear and objective standards or the alternative process and the approval criteria for the alternative process comply with all applicable land use planning goals and rules. * * * "(6) Any approval standards, special conditions and the procedures for approval adopted by local government shall be clear and objective and may not have the effect, either in themselves or cumulatively, of discouraging needed housing through unreasonable cost or delay."

16 12 First, a plain reading of the text of the statute fails to support Petitioner's interpretation. ORS (6) allows an alternative processing track for applications based on "approval criteria regulating, in whole or in part, appearance or aesthetics." That language suggests that there will be criteria involved in this alternative process that do not necessarily regulate appearance or aesthetics at all. Second, when read in context, Petitioner's interpretation makes no sense. Under ORS (6), the alternative discretionary process can only be used if three requirements are satisfied-those requirements are found in subsections (a), (b) and (c). Subsection (a) restates a requirement that was found in ORS (3 )( d)(2009) (the applicant must retain the option to proceed under the "clear and objective" route). Subsection (b) restates ano~her requirement found in ORS (3)(d)(2009) (the alternate approval criteria comply with the statewide planning goals). The language found in subsection (c) used to be found in ORS (97.307(3)(b )(2009). It provides: "The approval criteria for the alternative approval process authorize a density at or above the density level authorized in the zone under the [clear and objective] approval process provided ' in subsection ( 4) of this section." This language makes it clear that the criteria used in this alternative process may be criteria regulating density, which are not criteria that regulate appearance or a~sthetics in whole or in part.

17 Third, the past changes to the needed housing statute do not support 13 Petitioner's interpretation of the legislature's intent in adopting the 2011 amendments. The prior provision, ORS (3)( d)(2009), clearly intended local governments to be able to provide an optional alternate. track with discretionary approval criteria. There is no suggestion that, when subsection (3)(d) and{3)(b) were combined into subsection (6), that broad grant of discretion was intended to be limited in the extreme way that Petitioner proposes. Further, the language found in ORS (3)(b)(2009) was added in 1997, the same time subsection (3 )(d) was added, in order to highlight the need to require a path to approval in which any regulation' of appearance and aesthetic is clear and objective. Not the other way arpund. Petitioner's suggestion that only criteria related to appearance or aesthetics can be included in the alternative track makes no sense and ignores past legislative changes to the statute. Finally, and most importantly, Petitioner's interpretation represents a sea change in needed housing and would require cities to conduct major overhauls to their codes. Under Petitioner's theory, a party proposing to build needed housing can no longer choose how to apply for its housing proposal. In many Oregon cities, including in Eugene, every type of housing is "needed housing," because populations with diverse needs continue to grow: Therefore, according

18 to Petitioner's interpretation of the 2011 changes, huge portions of the 14 development codes in these cities would be rendered obsolete and any party proposing to build any housing would now be forced to apply under the city's ''clear and objective" path. Every homebuilder would be required to design housing to comply with cookie-cutter "clear and objective" requirements, even if that builder would prefer to seek the city's approval under a discretionary criterion that would allow the builder to address the_specific attributes of his particular site or to be creative in the design of the development. That is the very reason the legislature created the alternate track in the first place. Again, Petitioner argues that the discretionary option was taken away from builders in 2011, except, they say, in the case of a city's regulation of appearance or aesthetics. (Note that these were the regulations that were specifically called out as needing to be clear and objective in 1997). This position is absurd. It upends decades of law and policy and demonstrates a lack of understanding of the "needed housing law." In reality, the entire premise behind the St. Helens Policy and the needed housing law is that the State must ensure that those builders who would build housing that a city actually needs are not subject to the unbridled discretion of a city that may want to keep "that kind of housing" out. It was never intended to deny those builders the option to proceed under a discretionary process if they so desire.

19 III. CONCLUSION 15 The homebuilder's choice between discretionary and nondiscretionary standards has long been, and remains, a part of the needed housing law. It is clear that a city cannot "subject" a builder of needed housing to a discretionary approval process. It is equally clear that a builder of needed housing can choose an alternative approval process. Based on the City's arguments set forth above, and Cross-Petitioner's response to this assignment of error, the Court shoulddeny Petitioner's second assignment of error and affirm LUBA's order. Dated this 12th day of September, CITY OF EUGENE By:~C~ Anne C. Davies, OSB # City Attorney's Office 125 E. 8th Avenue Eugene, OR Telephone: (541) anne.c.davies@ci.eugene.or.us O(Attomeys for Respondent City of Eugene

20 Brief Length. CERTIFICATE OF COMPLIANCE WITH BRIEF LENGTH AND TYPE SIZE REQUIREMENTS I certify that (1) this brief complies with the word;.count limitation in ORAP 5.05(2)(b) and (2) the wordcount of this brief(as described in ORAP 5.05(2)(a)} is 3,602 words. Type Size I certify that the size of the type in this brief is not smaller than I4 point for both the text of the brief and footnotes as required by ORAP 5.05( 4)( ). CITY OF EUGENE By:Lc~ Anne C. Davies, OSB # Of Attorneys for Respondent City of Eugene

21 ''. CERTIFICATE OF FILING I certify that on September 12, 2013, I caused to be filed the original and 5 true copies of this Respondent City ofeugene's Answering Brief with the Appellate Court Administrator at this address: Appellate Court Administrator Appellate Court Records Section 1163 State Street Salem, OR by Federal Express Standard Overnight delivery. CERTIFICATE OF SERVICE I further certify that on September 12, 2013, I caused to be served two true copies of this Respondent City of Eugene's Answering Brief on: Daniel C. Snyder. Law Offices of Charles M. Tebbutt, P.C. 941 Lawrence Street Eugene, OR Bill Kloos Law Office of Bill Kloos PC W. 4th Street, Suite 204 Eugene, OR Of Attorneys for Petitioner Of Attorneys for Respondents Nicholas S. Cady Cascadia Wildlands 1247 Willamette Street Eugene, OR Attorney for Amicus Curiae Cascadia Wildlands Sean T. Malone Attomey at Law 259 E. 5th A venue, Suite 200-G Eugene, OR Attorney for Amicus LandWatch Lane County by Federal Express Standard Overnight delivery. CITY OF EUGENE By:~ C:J~ Anne C. Davies, OSB # anne.c.davies@ci.eugene.or.us Of Attorneys for Respondent City of Eugene