January 10, 2014

Woodburn UGA – Strike Two


The Oregon Court of Appeals kicked off the new land use year with a reprise of its 2010 opinion rejecting the City of Woodburn’s urban growth boundary expansion.  In 2005, the city decided to expand its urban growth boundary to include 409 acres for industrial uses, which equates to 362 net buildable acres after deducting right-of-way.  The city relied on its economic consultant, ECONorthwest, which provided an economic opportunities analysis and related work pursuant to state planning regulations.

Traditionally, cities forecast employment growth and apply standardized ratios of employees per acre to calculate the number of acres needed.  Woodburn and ECONorthwest tried something unique.  The city sought specific industries that would pay high wages and be attracted by the convenient location along I-5.  It believed it needed to provide a variety of sites for targeted industries to select from, rather than a bare minimum of sites to fulfill the projected need.  The city also accounted for the surplus land within partially developed sites, given that many employers purchase much more land than they need in the short or medium term, in order to facilitate future growth without having to relocate.  The state Land Conservation and Development Commission (“LCDC”) agreed that providing market choice among sites was a key component of a successful economic development strategy, and that industrial users often choose sites larger than immediately required to ensure they have adequate land for future expansion.  In the 2010 opinion, the Court of Appeals ruled that LCDC “provided essentially no reasoning” to explain why Woodburn’s unique approach satisfied state rules.

After that decision, LCDC issued a revised order in 2011 again approving the UGB expansion.  LCDC noted the targeted industries approach yielded a result that closely correlated with the traditional employees per acre method, and that the city’s (i.e. ECONorthwest’s) analysis of population, employment, target industries, and site requirements complied with the state rules.  On January 2, the Court of Appeals ruled that the LCDC revised order is not supported by substantial reason, and that LCDC did not explain how Woodburn’s unique approach complied with the state rules.  The appeals court acknowledged that LCDC carefully reviewed the steps taken by the city and ECONorthwest, and found that each applicable state rule and statute was satisfied.  However, the court found that the LCDC revised order lacked a meaningful explanation of why the city’s work satisfied the legal standards.

So after seven years of work in close coordination with Oregon’s leading economic consultancy and the state’s land use agency, followed by eight years of state review and legal appeals, the City of Woodburn’s dogged effort to bring a bit of innovation, flexibility, and business common sense to Oregon’s land use planning system remains stymied by an appellate court that is even more rigid than the state’s land use agency.   We’ll soon learn whether LCDC will make a third attempt to satisfy the Court of Appeals or take this problem up to the Oregon Supreme Court.

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