Clear and Objective - The Importance of Oregon’s Needed Housing Statutes for Developers

By Keenan Ordon-Bakalian, Attorney

This article was originally published in the March 19, 2021 edition of the Daily Journal of Commerce Oregon.

As the affordable housing crisis continues across the region, developers should always be seeking an edge to get their projects approved. Enter Oregon’s needed housing statutes. These statutes are set out at ORS 197.295 to ORS 197.314 and should be in every builder’s toolbox for your residential development projects. With their initial enactment forty years ago this year, in 1981, the needed housing statutes incorporated into law the “St. Helens Policy,” to end local government attempts to exclude certain housing types that met lower, moderate, or “least cost” housing needs. Since their adoption, the needed housing statutes have been extended to most residential development projects, making them substantially easier to get approved.

The central provision of the needed housing statutes is ORS 197.304(4)’s “clear and objective” requirement. Needed housing requires that local government may adopt and apply only clear and objective standards, conditions, and procedures regulating the development of housing, including needed housing. The Land Use Board of Appeals (“LUBA”) has found that approval standards are not clear and objective if they impose subjective, value-laden analyses that are designed to balance or mitigate impacts of the development on (1) the property to be developed or (2) the adjoining properties or community. The standards, conditions, and procedures subject to needed housing may include, but are not limited to, provisions regulating density and height of development. In short, development standards may not have the effect, either in themselves or cumulatively, of discouraging needed housing through unreasonable cost or delay.

Critical to your project is the fact that ORS 197.304(4) does not require you to demonstrate that the development is “needed housing,” as defined in ORS 197.303. Instead, needed housing requires local governments to apply only clear and objective standards to applications for all housing, not just “needed housing.” Many jurisdictions continue to have secondary non-clear-and-objective standards for residential development approval, which is allowable under needed housing so long as the jurisdiction also provides at least one clear and objective path.

Developers can rely on needed housing to avoid all manner of subjective standards that a decision maker or project opponent could use to derail your approval. This includes ambiguous street improvement standards that fail to clarify timing, extent, and scope; landscape preservation requirements that rely on the decision maker’s subjective analysis of compliance; and the classic catch-all provision that “the development will not alter the character of the surrounding neighborhood.” The clear and objective standard of needed housing allows you to sidestep these value-laden analyses that would otherwise put your project in jeopardy.

Also on the table for developers wielding needed housing is the prospect of receiving attorneys’ fees at LUBA in the event the local government denies your project in violation of the needed housing statutes. Although appeals delay the timeline for your project, if you successfully appeal a project denial to LUBA on the grounds of needed housing, you may be entitled to your attorneys’ fees under ORS 197.835(10)(b). Needed housing can be utilized to demonstrate that the decision-maker erroneously issued a denial because they failed to apply clear and objective standards to your project.

Requiring local governments to apply clear and objective standards to residential development projects provides developers with the degree of certainty necessary to plan successful projects. Needed housing allows you to understand where the goalposts are and can help you avoid all sorts of subjective standards that a decision maker or project opponent may try and throw at you.

With low inventory and rapidly rising home prices, new housing starts are on the rise across the region. As Oregon moves past the impacts of the COVID-19 pandemic, more housing projects are expected to come online in response to chronic undersupply. Regardless of where in the region your residential development project is located, it is important to understand that you have needed housing at your disposal.
 
Keenan Ordon-Bakalian is an attorney in the Jordan Ramis PC land use and development practice group. Contact him at Keenan.ordon-bakalian@jordanramis.com.