Oregon Property Land Use, Measure 37 (2004)
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In 2011 the Citizens for Constitutional Fairness and individual landowners argued before the 9th U.S. Circuit Court of Appeals that they are entitled to compensation even though Measure 37 was later replaced by Measure 49. Measure 49 superseded Measure 37 by removing a provision for monetary compensation. Instead Measure 49 allowed for landowners to build up to 10 homes on the eligible properties.
The law enacted by Measure 37 allows property owners whose property value is reduced by environmental or other land use regulations to claim compensation from state or local government. If the government fails to compensate a claimant within two years of the claim, the law allows the claimant to use the property under only the regulations in place at the time he/she purchased the property.
Measure 37 has figured prominently in debates about the rights of property owners versus the public's right to enforce environmental and other land use regulations.
Advocates for Measure 37 have described it as a protection against "regulatory taking," a notion with roots in the United States Constitution.
The advocates of Measure 37 believe that reducing a property's value through regulations constitutes a "regulatory taking" in violation of the U.S. Constitution.
Measure 37 was ruled unconstitutional in a 2005 circuit court decision, but the Oregon Supreme Court reversed that decision,MacPherson v. Department of Administrative Services, 340 Or. 117, 130 P.3d 308 (2006) ruling that the law was not unconstitutional, and noting that the Court was not empowered to rule on its efficacy:
"Whether Measure 37 as a policy choice is wise or foolish, farsighted or blind, is beyond this court's purview."
In the early 1970s, Senate Bill 100 and Portland's 1972 Downtown Plan established bold guidelines for the regulation of land use. Oregon became known for its land use planning. The strong 2004 passage (61%) of Measure 37 is considered a political backlash to that legacy of regulation, and follows several other unsuccessful efforts to restrict land use regulation:
- Oregon Ballot Measure 65 (1998) and Oregon Ballot Measure 2 (2000) sought to restrict the Legislature's ability to regulate land use; both measures failed.
- Oregon Ballot Measure 7 (2000) was similar to Measure 37. It was approved, but struck down by the Oregon Supreme Court.
- Measure 39, which passed in 2006, restricted the use of eminent domain. It was promoted by Oregonians In Action as a "natural extension" of Measure 37, and passed with very little opposition.
In 2006, voters in California, Idaho, and Arizona considered ballot initiatives similar to Oregon's 2004 Measure 37. Arizona approved the initiative, while it was rejected by the voters of California and Idaho.
Arizona's initiative combined the land use/regulatory taking issue central to Oregon Ballot Measure 37 with a restriction on eminent domain (similar to Oregon Ballot Measure 39 (2006)). The Arizona initiative's proponents focused their arguments almost exclusively on the less controversial eminent domain portion of the initiative.
Eminent domain reform activists in Nevada collected signatures to place a similar initiative on that state's ballot. However, the regulatory takings portion of Nevada's initiative (was removed by the U.S. Supreme Court on the grounds that it violated the single-subject rule. Voters approved the remaining restrictions on eminent domain. The Nevada initiative will be reviewed in the next election.
The California, Idaho, Arizona and Nevada eminent domain initiatives in 2006 were sponsored by Americans for Limited Government.
The following are the first three sections of the law, for a complete version, see Oregon State Land Use site.
- If a public entity enacts or enforces a new land use regulation or enforces a land use regulation enacted prior to the effective date of this amendment that restricts the use of private real property or any interest therein and has the effect of reducing the fair market value of the property, or any interest therein, then the owner of the property shall be paid just compensation.
- Just compensation shall be equal to the reduction in the fair market value of the affected property interest resulting from enactment or enforcement of the land use regulation as of the date the owner makes written demand for compensation under this act.
- Subsection (1) of this act shall not apply to land use regulations:
- Restricting or prohibiting activities commonly and historically recognized as public nuisances under common law. This subsection shall be construed narrowly in favor of a finding of compensation under this act;
- Restricting or prohibiting activities for the protection of public health and safety, such as fire and building codes, health and sanitation regulations, solid or hazardous waste regulations, and pollution control regulations;
- To the extent the land use regulation is required to comply with federal law;
- Restricting or prohibiting the use of a property for the purpose of selling pornography or performing nude dancing. Nothing in this subsection, however, is intended to affect or alter rights provided by the Oregon or United States Constitutions; or
- Enacted prior to the date of acquisition of the property by the owner or a family member of the owner who owned the subject property prior to acquisition or inheritance by the owner, whichever occurred first.
Supporters argue that Measure 37 has provided protection of the value of property by insuring that new legislation doesn't decrease property values or limit development possibilities. Timber companies and real estate developers were the most prominent supporters (and the primary funders) of Measure 37.
Measure 37's sponsor, Oregonians In Action, and various supporters referred during the 2004 election to the case of Dorothy English, a then-92-year-old woman, as a cause celebre. Enacted zoning regulations prevented English from dividing her land into pieces that could go to each of her children.
The following are major arguments advanced against Measure 37:
- Given that a large portion of a property's value is created by legislation (e.g. laws providing for public roads, sewers, electrical lines, parks, etc), it is unreasonable to require the government to compensate property owners for any additional legislation which might restrict property use in the name of the public good.
- As more claims are being filed, some residents develop concerns about unregulated development.
- The legislation is claimed to impose a burden on the taxpayer, because there is no provision for funding any payoffs for claims under Measure 37 within the Measure's text. Therefore, all funds must be taken from the general budget of the municipality which seized the private property in question. In order to maintain the existing levels of protection for their communities, while simultaneously seizing private property under eminent domain, taxpayers would have to fund billions of dollars in compensation to landowners. Supporters of Measure 37 believe that this concern is mitigated when municipalities observe private property rights.
- The legislation is incomplete, in that it fails to dictate a method for determining property value when a claim is filed or evaluated.
As of March 12, 2007, 7,562 Measure 37 claims for compliance payments or land use waivers had been filed spanning 750,898 acres statewide in Oregon.
Claims filed in Portland, Oregon, by December 4, 2006, totalled over $250 million. Many of these claims were filed by major area land developers.
The owners of Schreiner's Iris Gardens filed a claim in late 2006, demanding either $9.5 million or the right to subdivide their 400 acres. They assert that they have no intention of changing the use of the property, but want to keep options open for the future.
John Benton, a Hood River County fruit farmer, filed a Measure 37 claim, demanding either $57 million or the right to build 800 houses on his 210 acres of property. Neighboring farmers objected, due to the significant impact they anticipated such a change would bring to their community.
In the fall of 2006, the Palins, a Prineville couple, filed a Measure 37 claim, demanding either $200,000 or the right to develop their property, which is on a scenic portion of rimrock visible from the city. The city did its own appraisal of the property's potential value, and offered $47,000. This was the first case where the government offered money instead of a waiver of land use restrictions, and highlights the Measure's lack of a clear process for determining the value associated with a claim.
In a January 15, 2007 article, a statewide newspaper highlighted a Measure 37-based claim in Hood River County, in which land owners aim to develop a parcel of rural land eight times the size of the city of Hood River.
Background on Property Rights
- Georgetown University background on the takings issue
- a "Republican developer type" on property rights from the GELPI site
Oregon specific links:
- State of Oregon's Measure 37 page
- Full text of Measure 37 
- Portland State University project measuring the impact of Measure 37, including searchable index of claims 
- Land Use Watch articles about Measure 37 and other land use issues
- Report on impacts of Measure 37
- Measure 37 resources from land use advocates 1000 Friends of Oregon
Political and legal analysis:
- report on the context and effects of Measure 37
- list of issues unresolved by MacPherson v. DAS
- Ballot analysis from Paul Jacob of Common Sense
- List of Oregon ballot measures
- Oregon 2004 ballot measures
- Procedures for qualifying an initiative in Oregon
- Laws governing the initiative process in Oregon
- Oregon Ballot Measure 49 (2007)
- 2004 ballot measures
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