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LUBA ruling puts regional housing onus on Metro

From Daily Journal of Commerce.

A recent decision by the Oregon Land Use Board of Appeals considered the extent to which local governments must provide for the housing needs of Oregon citizens under Statewide Planning Goal 10 and other laws.

According to Goal 10, “Buildable lands for residential use shall be inventoried and plans shall encourage the availability of adequate numbers of needed housing units at price ranges and rent level which are commensurate with the financial capabilities of Oregon households and allow for flexibility of housing location, type and density.

In addition to this obligation, Oregon has three other housing mandates applicable to local governments in the Portland region: a set of “needed housing” statutes, certain state administrative rules to implement Goal 10 in the Portland region (the “Metro Housing Rule”) and a further subset of those rules requiring Metro, the regional government, to assure that certain types and densities of housing were provided for. That term “needed housing” is defined by statute but in this case included attached and detached housing, government assisted housing, manufactured homes in parks and individual lots, and farmworker housing.

The case, Housing Land Advocates v. City of Happy Valley, made some significant determinations as to how these obligations applied. [Disclosure – One of your columnists is a Housing Land Advocates board member.] The case involved a plan amendment and zone change to reduce significantly the density requirements on a vacant parcel of land. Only the land use classification of the property was at issue – there was no particular development proposal at issue in this case; however, there was a separate subdivision approval not appealed that significantly reduced the density on the site.

LUBA concluded that read together, the needed housing statutes did not require the city to prove that it still met any particular housing projection. Moreover, LUBA found that a needed housing statute that requires a city to compile an inventory and analysis of housing need by type and density range through a buildable lands inventory only applies when a city within the Metro region undertakes periodic review or a legislative review of its own plan or when the Metro regional plan undergoes a legislative review. Happy Valley has never undergone periodic review and it is unlikely it will do so in the foreseeable future.

LUBA found that Metro is obliged to review the city’s plan and regulations under the inventory and analysis requirements when it next determines a need to expand the regional urban growth boundary or undertakes any other legislative review of its regional framework plan or when the city undergoes periodic review.

HLA also contended that the density reduction violated two aspects of LCDC’s Metro Housing Rule, specifically the “50/50 rule,” under which half of all new housing must be single-family attached or multifamily, and the “6-8-10 rule,” which requires Happy Valley to show that its housing build-out would amount to six units per net residential acre. The city contended it met the six units per acre portion of the rule as it calculated build-out at the maximum number of units allowed on vacant residentially zoned land (a contention met with some skepticism by LUBA) and that attached and multifamily residential uses could be allowed in the newly-applied zone (though perhaps unlikely, given the market for upscale housing in the city). However, LUBA rejected the HLA’s central contention that the city was obligated to show that both rules were met on a city-wide basis every time a plan amendment were granted, concluding that those obligations only occur at periodic review.

Instead, LUBA found that the city was obliged to show compliance with another aspect of the Metro Housing Rule, which allowed the city to reduce the residential capacity of a parcel only if it has a “negligible effect on its overall minimum zoned residential capacity.” The city’s findings noted that the subject site was only five acres in a city of over eight square miles, most of which is residentially zoned. However, LUBA concluded that the city neither identified the minimum zoned residential capacity of the subject property, nor how much that minimum zoned residential density was reduced by the challenged amendment. The city must address these issues on remand.

Happy Valley is among the richest places in Oregon by household income. That city has done little to calculate, let alone provide, its regional fair share of affordable housing. The plan amendment in this case reduces the city’s ability to provide lands identified as necessary to meet affordable housing needs. It is for reasons such as this that additional incentives, such as expedited review for needed housing proposed as part of HB 2007, sponsored by House Speaker Tina Kotek, have been advanced. It is not enough that Metro is required to provide an adequate supply of land; incentives or disincentives must be in place to encourage local governments and developers in order to achieve this result.

Edward Sullivan is a retired partner in the Portland office of Garvey Schubert Barer. He practiced land use and municipal law for more than 45 years. Contact him at esulliva@gmail.com.

Carrie Richter is an attorney specializing in land use and municipal law at Bateman Seidel. Contact her at 503-972-9903 or crichter@batemanseidel.com.

http://djcoregon.com/news/2017/05/09/op-ed-luba-ruling-puts-regional-housing-onus-no-metro/