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The Court of Appeals Affirms the Urban Growth Boundary Expansion for the City of Scappoose

800px-Scappoose_Industrial_Airpark_OregonScappoose, Oregon, located right off Highway 30, has only 6,800 residents. Its motto is “A place to grow.” This expected growth was the subject of a recent court of appeals case, Zimmerman v LCDC, 274 Or App 512 (2015). In 2011, the city enacted an ordinance amending its comprehensive plan, hoping to add more land to its UGB designating much of it for industrial and commercial uses, particularly for airport employment uses. To expand a UGB pursuant a Goal 14, a local government must establish that land is needed to further future economic opportunities; determining such need requires compliance with Goal 9 and implementing administrative rules. In order to justify such expansion, a local government must compare the demand for industrial and employment lands against the existing supply, through a review of the “best available” information considering national, regional or local trends, site characteristics of expected uses and development potential. OAR 660-009-0015.

The city relied on an Economic Opportunities Analysis (EOA) dated 2011, which set a rate of job growth between 2003 and 2007, assumed a modest decline from 2008 to 2010, to accommodate the rejection and then extrapolated from that a projection of new employment between 2010 and 2030. Petitioner argued that the actual job losses in 2008 to 2010 were more than assumed by the city and therefore, the EOA was not based on the “best evidence” as required by OAR 660-009-0015. LCDC rejected that objection finding that a local government is not required to “undertake multiple, shifting iterations of the same analysis.” Rather, LCDC found that “so long as the new employment data does not make it unreasonable for the city to rely on the employment data that it did, the choice between conflicting evidence is the city’s.” Given the courts, deferential review standard for considering LCDC interpretations of its own rules, the court found LCDC’s interpretation plausible. EOA’s are typically part of a community visioning process that occurs before plan amendment process and thus, it was reasonable for the EOA to be based on the information available at that time.

Petitioner went on to challenge the city’s reliance on a presumed growth rate from 2003 – 2007 on the ground that it did not represent a “bona-fide long term trend.” OAR 660-009-0015(1). LCDC responded that the EOA was not based solely on the historic period the objection alleges but on other information and trends. Petitioner argued that the other information was undocumented and incomplete. The court agreed with LCDC. “Any criticism of the quality and sufficiency of the evidence about employment growth rates in the EOA does not demonstrate that LCDC misunderstood its substantial evidence standard of review.”

For her third challenge, the petitioner argued that the city erred in placing too much emphasis on the need to accommodate employment projections from a larger, regional, Portland planning area. Petitioner argued that the city failed to coordinate that growth with Metro. The court rejected this argument finding that the city did not plan to capture growth planned to occur within the Metro UGB but instead it shared “locational advantages” that leads to past employment growth rates exceeding those in the Portland metro area.

Petitioner’s fourth argument centered on the city’s growth findings to bring in additional land to “increase employment opportunities near the airport” required a more particular justification. LCDC and the court rejected this argument and concluded that the city could justify adding additional lands based on locational factors, such as proximity to an expanding airport.

Finally, Petitioner argued that the city erred in relying on an employment forecast that projected greater job growth than the population forecast projected. Petitioner argued that this divergence violated former OAR 660-024-0040(1), which required that the UGB be based on an adopted 20-year population forecast, but it did not require “an unreasonably high level of precision.” OAR 660-024-0040(5) further provides that employment lands are to be based on an estimate of job growth but “Goal 14 does not require that job growth estimates necessarily be proportional to population growth.” The court affirmed LCDC’s finding that proportionality between population and job growth forecasts is not required, and finding a multiplier effect given the proximity to the Metro UGB provided a reasonable explanation. LCDC’s decision was affirmed.

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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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