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Potential
Impacts of Measure 37 on ODOT
1000 Friends'
Transportation Advocate Rob Zako and Staff Attorney Carrie MacLaren presented
the following information to the Oregon Transportation Commission on June
15, 2005:
Executive
Summary
Measure
37 requires public entities to pay certain landowners to abide by land
use regulations enacted after the owner or family member acquired the
property, if the regulation restricts the use of the property and results
in a reduction of the fair market value. In lieu of compensation, Measure
37 also authorizes public entities to exempt those landowners from regulations
enacted after the landowner acquired the property.
Measure 37 may reduce the effectiveness (or increase the cost) of highway
investments by allowing types and intensities of land uses in excess
of what ODOT anticipates. Such unanticipated uses could include 1) significant
growth outside urban growth boundaries that raises the general level
of traffic on state highways, 2) significant development close to—but
not directly accessing—state highways, especially near interchanges,
and 3) access to state highways in violation of access management rules.
ODOT should determine what types of unanticipated uses could be allowed
under Measure 37 that would have the greatest impacts on the effectiveness
and/or cost of state highways. Then ODOT’s modeling section should
analyze some important test cases, assuming that what is allowed under
Measure 37 actually occurs. Based on the results of this analysis, ODOT
might consider revising its plans, policies and/or funding estimates.
Depending on what is
learned, it might be useful for ODOT to notify the Legislature and other
interested stakeholders about potential changes in the effectiveness
and/or cost of the state highway system.
Full Testimony
Although
we have communicated with this Commission and ODOT about Measure 37’s
implications for state highways, we wanted to take this opportunity—now
six to seven months into the Measure—to highlight the types of
challenges ODOT may face in planning and highway projects under Measure
37. Our interest isn’t in these examples, per se, but rather to
alert ODOT to potential challenges under Measure 37 and to suggest some
short-term steps ODOT might take in response to these potential challenges.
Measure 37
Measure
37 became effective on December 2, 2004 (30 days after the election)
and is now the “law of the land.”
The measure provides that a landowner is entitled to receive just compensation
when a land use regulation is enacted after the owner or a family member
acquired the property if the regulation restricts the use of the property
and reduces its fair market value. In lieu of compensation, the measure
also provides that the government responsible for the regulation may
choose to remove, modify or not apply (“waive”) the regulation.
(The full text of Measure 37 is reproduced below.)
Insofar as no source of revenue has yet been identified to pay Measure
37 claims (some of which amount to tens of millions of dollars), many
state agencies and local governments have concluded that their only
option is to grant waivers to land use regulations. Indeed, since Measure
37 went into effect late last year, over a thousand claims have been
filed around the state. Of those claims that have been determined valid,
the vast majority have resulted in waivers being granted.
The Legislature has an opportunity to change Measure 37, and is currently
working to amend Measure 37 through Senate Bill 1037 and House Bill
3120. At this point, it is uncertain whether any Measure 37 legislation
will be adopted this session. Given the uncertainties of many of Measure
37’s provisions, it will probably take a while for courts to sort
out exactly how Measure 37 applies.
Potential
Impacts on ODOT
In general,
Measure 37 may have an impact on ODOT because it retroactively allows
types and intensities of land uses that were not previously allowed
and that have not been anticipated in modeling of the performance of
state highways. Measure 37 may also have an impact on ODOT because it
could have a chilling effect prospectively on local governments looking
to manage growth.
Here we offer a few scenarios of ways in which Measure 37 could impact
ODOT.
1. Significant growth outside urban growth boundaries
Most of the Measure 37 claims filed so far are for development outside
urban growth boundaries (UGBs) on land zoned for Exclusive Farm Use
(EFU). While some of these claims are for single-family houses, many
others are for residential subdivisions of varying sizes (10 to 100
or more units) or for major commercial developments.
The issue for ODOT is that current modeling practices assume that little
development will occur outside UGBs. But we are already seeing that
this assumption is invalid under Measure 37 and that significant development
is likely to occur outside UGBs under Measure 37 waivers. While such
development might not cause Oregon’s overall population to increase
more than it otherwise would, it will change how that population is
distributed. By allowing people to live, work or shop farther from urban
centers, Measure 37 may result in longer trips, thus causing an increase
in the average vehicle miles of travel per capita (VMT). Roughly speaking,
an increase in VMT will increase the demands on the state’s transportation
system, including the state highway system. The result could be lowered
performance of the state highway system, or else increased costs to
improve the state highway system more or sooner than would be required
in the absence of Measure 37.
Example A: Yamhill County
A good
example is Yamhill County, which has seen actual and expected Measure
37 claims totaling almost 13,000 acres, or over 20 square miles. This
amount of land is greater than the total land area of McMinnville, Yamhill
County’s largest city with a population of roughly 30,000.
2.
Significant development close to—but not directly accessing—state
highways, especially near interchanges
Especially
near interchanges, ODOT attempts to protect the state highway system
by working with cities and counties to limit the types and intensities
of development allowed near state highways. One important tool for doing
so is an Interchange Area Management Plan (IAMP).
The issue
for ODOT is that Measure 37 may allow some property owners to retrospectively
develop in ways not allowed under an IAMP. Moreover, Measure 37 may
have a chilling effect on local governments and discourage them from
agreeing to such restrictions near interchanges prospectively.
In particular, trip generation caps may not be effective under Measure
37. Such trip caps may fall under the Measure 37 definition of a “land
use regulation.”1
Lacking
effective controls in an IAMP, developments may occur near interchanges
that cause interchanges to fail sooner than they otherwise would, which
might cause ODOT to need to spend more money to improve the interchanges.
Example B: Interstate-84/Highway 86 Interchange
A good
example is the Interstate-84/Highway 86 Interchange in Baker County
just north of Baker City. Mr. Conchlin owns a 16.36-acre parcel that
actually straddles the north side of the interchange but lies mostly
in the northeast quadrant. Mr. Conchlin has owned the property since
1963. In 1970, Baker County designated the land EFU. Recently, Mr. Conchlin
filed a claim under Measure 37. Baker County granted Mr. Conchlin a
waiver to do anything he wants with his property, subject only to access
requirements and state requirements. Currently, Mr. Conchlin says he
just wants to build a house. But a commercial developer wishing to locate
close to that interchange might make Mr. Conchlin an offer he would
find hard to refuse. In any case, ODOT is in the process of developing
an IAMP for the interchange. Given the very real possibility of development
on EFU lands under Measure 37, ODOT is planning for the contingency
of having to realign access roads to meeting ODOT’s spacing standards.
Our understanding is that ODOT has no plans (or ability?) to prevent
more intense development from occurring near this interchange as a result
of Measure 37.
Example
C: Woodburn Interchange
Another
good example is the Woodburn Interchange between Interstate-5 and Highway
214/219. The City of Woodburn has been holding hearings in advance of
revising their land use designations as part of periodic review. According
to a news story that recently appeared in The Woodburn Independent:
“Amanda Dalton, representing North Willamette Association of Realtors
said, ‘With Ballot Measure 37, this is not the time to further
regulate land use,’ referring to restrictions on commercial development.”
It is our understanding that Ms. Dalton was opposing a proposed Interchange
Management Area Plan, which would place a trip generation cap on some
undeveloped commercial land already within the city (as well as on land
proposed to be added into the city).
3.
Access to state highways in violation of access management rules
Lastly,
Measure 37 might allow access to state highways in violation of access
management rules. While access management rules might not fall under
the Measure 37 definition of a “land use regulation,” that
won’t necessarily stop property owners from seeing such rules
as land use regulations and thereby filing Measure 37 claims.
In our
view, this scenario poses the least risk to ODOT and possibly no risk
at all. But as with so much of Measure 37, the legal question may ultimately
need to be decided in court.
Example
D: North Medford Interchange
One example,
although perhaps not a good example, is the North Medford Interchange
between Interstate-5 and Highway 62. As you probably know, the Rogue
Regency on Biddle Road wants a left-turn lane access in violation of
access management rules.
Having
failed to secure such access through other means, the Rogue Regency
recently filed a Measure 37 claim against ODOT. The claim is currently
working its way through the system.
Suggestions
for Next Steps
Above we
have tried to describe some scenarios where Measure 37 could significantly
impact ODOT. There could be other scenarios or variations on these scenarios
that we have not yet considered.
We urge
ODOT to identify what kinds of unanticipated uses could be allowed under
Measure 37 that would have the greatest impacts on the effectiveness
and/or cost of state highways. In particular, we urge ODOT to seek legal
opinions on the scenarios we have proposed.
Once ODOT
has a better sense of what is possible under Measure 37, we urge ODOT’s
modeling section to analyze some important test cases, assuming that
what is allowed under Measure 37 actually occurs. The intent should
not be to predict what will happen but to get a sense of the range of
what could happen: How significant could Measure 37 be to ODOT? ODOT
might wish to run models of some projects of statewide significance.
ODOT might
also wish to reexamine the scenario developed in the update of the Oregon
Transportation Plan that assumes weakened land use controls: Do the
assumptions in that scenario go as far as Measure 37 already is, for
example, in allowing development across Yamhill County?
We appreciate
that there is great uncertainty around Measure 37. Nevertheless, 1000
Friends of Oregon believes it is important for ODOT to begin assessing
the potential impact of Measure 37 and respond accordingly—as
we ourselves have had to do. We’d be happy share with you or your
staff more about Measure 37. Please let us know how we can assist you
in your efforts.
Download
this testimony (174K PDF)
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