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The Path Not Taken

Current process overview

Rather than a mechanistic land need formula, statute and rule [2011] describe an informed local policy choice decision process to establish the need for employment land that in turn drives the size of the UGB. Cities are to examine influential trends, define needed site types, conduct an inventory and estimate a needed number of sites to meet community objectives. There are a number of suggestions that are strongly encouraged but not mandated.

The problems

The two most significant problems are discussed first; others follow in no particular order. First, cities that complete the process have plans that are subject to appeal. Statute and rule make economic development planning an informed policy choice. Almost all appeals challenge the local decision on substantial evidence. This is a manageable problem if the city intends to make no significant deviations from current circumstances and does not wish to radically alter their land supply to attract new opportunities. However, the point of employment land planning efforts often is exactly to deviate from current circumstances and establish a land supply to accommodate – even attract – new opportunities. Although retaining and expanding existing local business is critical and in many ways more important than competing for new recruitments, local governments have little authority and few tools to offer beyond annexation, zoning and infrastructure deployment. New aspirations are allowed but it is notoriously difficult to prove that you need them. The planning problem is who decides the final decision and when.

The second most significant problem has to do with the nature of planning itself: framework, data and decision. The Oregon land use system for urban areas is dominated by the residential planning model. Residential planning starts with an assigned control number, the coordinated population, and then proceeds by formula based on dwelling types and housing unit density. There are those who believe that a similar system should be imposed for employment planning. That system would establish an employment forecast, or derive one from the population forecast, and proceed by building type and employee density.1 It is simple and easy to understand. There is a case to be made for this system for local serving retail and office land needs, although industrial, larger retail and the corporate offices of traded sector industries provide compelling exceptions.

The simple system breaks down in several fundamental ways when traded-sector industries are considered. By definition, a traded-sector industry brings new money into the area. Traded-sector opportunities are not derived from the provable need of the local population. Opportunities arise from so-called locational advantages having to do with proximity, access, infrastructure and workforce. These are things a business can use to make a profit. An available and ready land supply is a threshold condition, but does not by itself create opportunity. Raw land is even less important except to the extent it has reliable zoning is in place. The planning problem is to provide an attractive and ready land supply without overextending the cost of maintaining the right inventory.

It is common to talk about economic development in terms of employment head count. Planners like to think of it in the same context as residential uses, where increased density is presumed to be a good thing. Economic development professionals are often required to measure and report their work in terms of new jobs created. These constructs are not particularly useful and the professionals will say so privately. They are easy to understand and attractive in the same measure they are unsophisticated. The trend in business is to move from a labor intensive to a capital intensive toward a knowledge intensive model. Getting scale right is difficult and important. The plant floor gets bigger, more automated and supports fewer employees with better skills. The office building has fewer small cubes, more amenities and lots of open space for collaboration. Business models change rapidly; it is hard for Oregon planning to keep up. A system based on employment density has little offer but simplicity.

The land use system in Oregon is fairly described as a static map system. Every decade or so a city re-examines itself and adjusts its map. By contrast, business, especially traded-sector business, is dynamic. Its needs change rapidly. Its decision time-lines are tight for critical business reasons including competitive speed and cost to market. The planning problem is to quickly respond to unanticipated desirable opportunities with good sites, infrastructure and smooth process.

An effective statewide land use planning program has many potential and real benefits, but it faces the same challenges in terms of defining, providing and maintaining ‘good government’ that any other program faces. The Oregon land use system has evolved into a confusing sometimes contradictory body of prescriptive rules and prohibitions. Too little has been done to provide useful information to help local governments find their way and too little has been done to provide reliable and meaningful incentives to encourage preferred outcomes. State statutes and rules that guide local planning tend to treat everyone the same. Instead of using regulation to provide a few consistent standards of last resort the planning program has become a mixture of interacting suggestions and rules that no one truly understands. Decisions become more an exercise of power politics. A city’s resources are spent less on planning and more on litigation. It must be remembered that a city’s growth management decisions take place in the local context on a continuum that flexes with each election as it grows old, builds out, builds up and tries to survive. The organizational problem is to create a system that recognizes and honors local, regional and circumstantial differences.

There are thousands of acres of zoned employment land in Oregon. These lands may not be where or what the market is seeking. They may be constrained to such an extent they are not truly available for development. Much of the industrial land is left over from the legacy of formerly significant industries, including timber. Port operations may be constrained by encroachment, brownfields and other uncertainties. The Willamette Valley has some of the world’s best farmland. It also has the most workforce and infrastructure currently available. No one really knows the current amount and condition of the employment land supply, but we have a pretty reliable picture of the available capacity of certain expensive and irreplaceable infrastructure systems, especially transportation. New money for infrastructure is scarce, and if we are to support education and other general fund draws on state coffers, we are going to have to make a few difficult choices. To be blunt, we are going to have to give up farmland where existing infrastructure is available. The good and bad news is that there are only a few small opportunities to do this, so the real loss will be minimal. There will have to be an efficient and accountable way to make these important strategic decisions.

A framework for meaningful change must:

  • Manage incremental change with timely, efficient and final local decisions
  • Accommodate unanticipated opportunities of local, regional and state significance
  • Accommodate differences by region, size and trend
  • Provide a way to implement important strategic decisions amid conflicting values and policies
  • Define and manage useful standards and explain their practical value and application.