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Another Remand on Vested Rights Determination under Measure 49

Measure 49 reopened the method to review vested rights under 34 year-old case law in Clackamas County v. Holmes, 265 Or. 193 (1978). But, the analysis is vexing because very few local governments and courts are getting the analysis right. However, with each new decision, the Court of Appeals and Oregon Supreme Court are attempting to clarify how local governments and trial courts should consider the application of the Holmes factors necessary to make a vested rights determination.

The Holmes factors are:

1) The ratio of prior expenditures to the total cost of development;

2) The good faith of the landowner in making the prior expenditures;

3) Whether the expenditures have any relationship to the complete project or could apply to various other uses of the land; and

4) The nature of the project, its location and ultimate cost.

In Johnson v. Deschutes County, __ Or.App. __ (March 2012, A144929), Johnson obtained Measure 37 waivers from the state and county that allowed Johnson to develop his 52.6 acre property into a 40-lot subdivision in four phases. He received tentative subdivision approval in September 2006, and received final plan approval for the first phase of the subdivision under a Measure 37 waiver just before Ballot Measure 49 became effective in December 2007. Under Measure 49, the county hearings officer considered whether Johnson had a vested right in the subdivision and concluded, by primarily relying on the expenditure ratio, that Johnson had a vested right in only the first phase of the subdivision. The lower court reversed and entered its own Findings of Fact and Conclusions of Law. The county appealed and pending appeal the Oregon Supreme Court’s decision in Friends of Yamhill County v. Board of Commissioners, 351 Or 219 (2011) issued. The Court of Appeals ruled that the trial court erred by rendering its own extensive factual findings, an action it cannot take in a writ of review. It also ruled that under Friends of Yamhill County, the county’s hearings officer had miscalculated the expenditure ratio and that it must consider all of the Holmes factors equally. Therefore, the trial court’s judgment was vacated and the trial court was directed to have the vested rights question remanded to the county for reconsideration.

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We regularly update clients about changes in real estate law and on industry trends. This includes briefing clients on legislative proposals in the federal tax, housing and other legal areas affecting their businesses. Staying current enables you to anticipate and prevent legal problems as well as capitalize on new developments.
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