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 Campbell v. Clackamas County, __ Or.App. __ (December 2011, A139642), the court was asked to consider whether plaintiffs’ rights to develop a residential subdivision had vested under Measure 49. Plaintiffs acquired the 62-acre tract of land in 1969 at which time the property’s zoning allowed residences to be built on one-acre parcels. Subsequently, zoning restrictions limited the uses of the property to agriculture and forestry. Plaintiffs obtained Measure 37 waivers and sought a vested rights determination under Measure 49 to develop a 40-lot residential subdivision.
As the attorney for Friends of Yamhill County, Ralph Bloemers, aptly labeled them, those pesky “Ghosts Of Measure 37” are likely to haunt rural areas for years to come as a result of the Oregon Supreme Court’s recent ruling in Friends of Yamhill County v. Yamhill County. This case marks the first time the court has considered the scope of common law vested rights since its ruling in Holmes v. Clackamas County, over 40 years ago. The Holmes court identified six factors that must be considered to determine a property owner’s rights to continue construction when land use laws are enacted that would make a partially finished project unlawful.
With the recession, the Gulf Oil Spill and overseas wars, and battle raging over the future of urban growth in the Metro area, Oregonians may be forgiven for not bringing to mind a previous crisis and the resolution of that crisis chosen by voters after much debate. In 2004, voters passed Measure 37 to provide “just compensation” for property owners who claimed their balance sheets were reduced by state or local land use regulations. The remedy under the Measure was either payment for that “lost value” or (as was overwhelmingly the case) a waiver of those regulations that had been enacted since the current owner acquired the property. Over 6,850 Measure 37 claims, affecting over 750,000 acres of land were filed.
Ed Sullivan and Jennifer Bragar are pleased to announce that a comprehensive law review article entitled, “The Augean Stables: Measure 49 and the Herculean Task of Correcting an Improvident Initiative Measure in Oregon” has now been published by the Willamette Law Review, Vol. 46, Number 3, p. 577, Spring 2010.
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.